Djibouti Opposition Blames Politics for DP World Concession Row

Djiboutian opposition leader Abdourahman Boreh blamed his rivalry with President Ismail Omar Guelleh for the government’s decision to cancel DP World (DPW)’s concession at the country’s port.

Boreh, a presidential candidate in elections in 2011, also denied any wrongdoing during his tenure as chairman of the Djibouti Ports and Free Zones Authority. Djibouti’s government accuses Boreh of misusing his position to obtain “significant personal advantages” and is claiming $150 million in damages from him in proceedings in London, Dubai, Paris and Singapore.

“The allegations against me are all false,” Boreh said in an interview yesterday from Dubai, where he lives in exile. “I have been victimized. This is a personal vendetta by the president.”

The Djiboutian government on July 9 rescinded DP World’s concession at the Doraleh Container Terminal after it said it found evidence the Dubai-based company paid bribes and gave other financial incentives to Boreh while he was negotiating the concession agreement. DP World, the world’s third-biggest port operator, denies the allegations.

Djibouti’s government has been conducting an investigation into Boreh for the past six years. The Horn of Africa state accuses him of channeling funds and beneficial contracts to companies managed by himself and associates during his chairmanship of the port from 2003 to 2008.

“Bribes were made through the use of vague consultancy agreements and overseas shell companies,” the government said in a July 8 statement.

Financial Incentives

“Other financial incentives were also given; through the award of substantial construction contracts to Mr. Boreh’s companies, and through an attempted covert sale of a significant proportion of DP World’s shares in the container terminal to Mr. Boreh,” according to the statement.

The matter will go to trial in the U.K. next year.

“The president was my direct boss when the agreement was signed so he knew everything,” Boreh said. “There is proof that he knew everything, which we will submit to court.”

Guelleh has ruled the Horn of Africa nation since 1999, when he succeeded his uncle Hassan Gouled Aptidon, and changed the constitution in 2010 to allow him to extend his rule to a third term. A year later he won presidential elections with 80 percent of the vote after a campaign marked by opposition protests to demand conditions be put in place for a fair vote. Boreh withdrew from the race before the election was held.

Boreh left Djibouti in 2009. He was subsequently given a 15-year prison sentence after accusations he was involved in a grenade attack in the country. Boreh denied all charges and said the case was politically motivated.

Djibouti’s $1.2 billion economy relies on services related to the country’s location on the Red Sea, one of the world’s busiest shipping lanes. Transportation accounts for a third of gross domestic product in the nation, which is targeting increasing capacity at Doraleh to 3 million containers a year by 2015. DP World is the world’s third-biggest ports operator.

To contact the reporter on this story: Paul Richardson in Nairobi at pmrichardson@bloomberg.net

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net Karl Maier, Sarah McGregor

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