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Venezuela

Bolipuertos invests to win back container traffic

Some older CSA members with long memories may recall the 1997 AGM in the Venezuelan city of Valencia – perhaps one of the stranger locations for such a gathering.

Those who can cast their minds back may also remember a half-day visit to nearby Puerto Cabello – then, as now, Venezuela’s leading container port.

Back in the late 1990s, this was a country where gasoline cost just a handful of cents per litre and where it was said (only half-jokingly) that Venezuelans brushed their teeth with unleaded as it was cheaper to buy than water. And everyone seemed to drive a V8 Chevy.

But how times have changed. Fast forward 15 years or so and Venezuela is different. Gasoline may still be absurdly cheap in Venezuela, which apparently has the world’s cheapest pump prices; but despite having the world’s largest proven oil reserves, Venezuela has had its fair share of problems, and the nation’s ports are no exception.

Since 2010, the state-owned ports company Bolivariana de Puertos (Bolipuertos), with the help of Cuban advisers, has run all of the nation’s main cargo gateways: Puerto Cabello, Guanta, La Ceiba, La Guaira, Maracaibo and El Guamache. Perhaps understandably, nationalisation was not achieved without some trauma and strong objections from the private sector.

Grand plans

At the time of the CSA meeting, and for a period thereafter, Puerto Cabello had grand plans to rival Cartagena and Manzanillo as the Caribbean’s southern container hub – and one with plenty of inbound cargo of its own.

Today, such plans are a distant memory and Puerto Cabello and La Guaira concentrate largely on handling Venezuela’s imports. Yet both have ambitious expansion programmes; and Bolipuertos is keen to see an increase in container throughput capacity at both Puerto Cabello and La Guaira.

Puerto Cabello and La Guaira both saw sharp declines in container traffic in 2009 and 2010, but container moves picked up again in 2011 and reliable forecasts show Puerto Cabello aiming for an impressive 1.4 million teu by 2018 with the construction of a new US$ 520 million Chinese-built terminal firmly in the pipeline. La Guaira is also being expanded in order to accept vessels of up to 6,500 teu capacity. This work is set for completion in 2016.

At the same time, a huge cargo handling equipment order in 2013 for Puerto Cabello and La Guaira included 30 reach stackers, four empty container handlers, eight heavy fork-lift trucks, nine light fork-lifts, seven heavy terminal tractors, 41 medium terminal tractors and a rubber-tyred gantry crane. This followed a previous large equipment order in 2011 from the same supplier.

Then Bolipuertos placed a further €20 order with Cargotec in late 2013 for 15 Kalmar E-One² rubber-tyred gantry cranes for use at the Port of La Guaira. This is the latest element in a wider order for equipment.

But despite the eye-catching equipment orders and plans to increase throughput capacity, a talk with almost any carrier serving the Venezuelan market will reveal operational concerns. One carrier regular serving the Venezuelan market told CM that the company preferred not to comment on the current situation as it was “too risky in every respect”. So, on the one hand, there is a drive to improve performance and step up investment; but on the ground there are still challenges for both lines and shippers as they grapple with spiralling levels of bureaucracy, berthing and customs delays, the politically motivated hiring of workers, and increased levels of irregular practices.

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Capacity

As the highly respected Forbes magazine stated in December last year in an article about South American ports in general: “Insufficient capacity isn’t the only driver of corruption at ports. New protectionist policies in several Latin American nations – including the nationalisation of Venezuela’s ports – have created additional layers of bureaucratic red tape. This often means more palms to grease.”

Meanwhile, and in a separate development, Venezuela has set up Puertos del Alba, a state-owned company charged with “modernising, renovating, equipping and constructing” ports in Venezuela and Cuba. According to the decree, Puertos del Alba would have an initial capital of 3.2 million bolivars (approximately US$ 1.5 million at the official exchange rate) and would be owned jointly by Bolipuertos (51 per cent) and Grupo Empresarial de la Industria Portuaria (ASPORT), a Cuban entity.

So it is full steam ahead for Bolipuertos in terms of the hardware; but the jury is still out on whether Venezuela’s ports have really got to grips with their “software” issues.