China Shipping Group, parent of China Shipping Container Lines, became the second mainland shipping firm to invest in a terminal in Egypt when it signed an agreement on Monday to acquire 20 percent of Damietta container port.
China Shipping joins five international investors in the joint venture operating the six-berth Damietta Port. Other investors include Kuwait's KGL International Terminal, CMA, CGM and United Arab Shipping. The total investment is US$200 million and China Shipping's share is $40 million.
Cosco Container Lines and China Shipping Container Lines, the fifth and sixth-largest shipping lines in the world, respectively, are increasing their presence in international ports to secure container berth capacity in their ports of call.
Anderson Chow, a port analyst at Macquarie Research said Egypt is in one of the most important routes in the Europe-Asia trade lane. He said shipping lines wished to secure berth capacity by investing in key ports.
The first phase of the six berths, with annual capacity of 2.5 million TEUs, will come on stream by the end of next year. The port will be able to handle four million TEUs when the second phase is completed.
The port of Damietta is about 8.5 km to the west of the Nile River tributary by the same name. It is 70 km to the west of Said, a port where Cosco Pacific has a stake.
Due to its proximity to the Suez Canal and its location on the interchange point to Africa, Europe and the Mediterranean Sea, Egypt is an important transhipment hub on the Europe-Asia trade lane.
Reflecting its growth strategy, China Shipping Group signed a joint-venture agreement with Yingkou Port Group earlier this month to invest $194 million in two container ports in Yingkou, Liaoning province.
|
