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French Version

With cranes at a standstill, the search for answers begins (Daily Star)

after years of delay and stalemate, industry insiders believe a solution is only months away
Meanwhile, a group of well-connected firms has begun demanding multi-million dollar compensation in anticipation of job losses

The towering red and blue cranes that seem to have permanently altered Beirut's skyline may not budge for another two months, according to port sources who offer contradictory reasons behind the costly stalemate.

Following six years of controversial delays and handovers, the $27 million shipment of Chinese gantry cranes will not be tested or fully installed for up to three months after their March 22 delivery date, said one port official who spoke to The Daily Star on the condition of anonymity.

The official claimed the delay merely came as part of the contract, however, other high level port sources said the standstill was the result of politics - mainly the multi-million dollar compensation demands of some 20 well-connected private firms, which will eventually be replaced by these state-of-the-art machines.

Represented by the Union of Equipment Contractors, sources say these companies have some 300 employees and own virtually all of the port's conventional cranes, forklifts and other heavy machinery, effectively managing all loading and unloading activities since the end of the civil war.

The union held two days of strikes last month, but is now demanding $40 million in indemnities, although it has never signed a contract with port authorities and has no legal foundation to back such claims, according to Hassan Jaroudi, the secretary general of the association of shipping companies."They are asking for the president to help them, but the government has not reached a decision on whether to pay or not," Jaroudi said.

Under a "gentleman's agreement," the private contractors have collected 65 percent of container handling costs since 1990 with the port collecting the remaining 35 percent, according to Elie Zakhour, the president of the International Chamber of Shipping.
Zakhour says the new gantry cranes will help transform the port from a largely domestic facility into a regional transit hub. But the latest stalemate only serves to further current losses, which come to at least $12 million per year, he explained, in reference to the cost of interest on the $200 million container terminal which has been vacant for almost four years.
The gantry cranes have been a critical element in the port's modernization plan, which faced numerous delays until the Dubai Port Authority pulled out as its operator in mid-2001.

There has been no official explanation for the events that have led to past controversies, but both Zakhour and Jaroudi are convinced that the demands and political affiliations of the current contractors, who they said have provided top-notch service for the past 14 years, is the principal reason behind the latest slowdown.

Port officials hope the crane purchase will help draw a new international operator, but they have not said when a tender will be released. The port authority will also have to purchase specialized software to operate the machines, which could cost up to $1 million.

Though new cranes are essential to improving port traffic and safety, critics have raised doubts about the facility becoming a regional hub.

Some sources say local port fees are not competitive enough to lure international carriers to Beirut - which can be a $15,000 detour (in terms of gasoline costs) for freighters headed through the Suez Canal.

But Zakhour remains optimistic. He said the port would have no problem recouping the cost of the gantry cranes as it generated $77 million last year.

"We have passed the red point and we must find a solution - there is no alternative. Now that the cranes are here, I believe the issue will be solved in the next three to four months."

Beirut 19-04-2004
Habib Battah
The Daily Star

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