Argentine gov. hands river control to port administrator AGP

Argentina’s government has signed a presidential decree transfering control of the key Parana-Paraguay river network to/

A presidential decree has handed responsibility for the control and maintenance of the key Parana-Paraguay river network to Argentina’s general port administration agency (AGP).

Decree 427 confirmed that AGP will take control of the waterway concession for a 12-month period until a long-term international concession could be awarded in 2022 - but trade sources have warned that the new arrangement could damage the country’s grain export competitiveness.

However, the government said that AGP’s concession could be potentially extended until a new concessionaire was selected.

AGP will have the capacity to call for a specific tender to select a foreign firm to take charge of dredging and signaling along the key waterways.

The presidential decree also stipulates that AGP will be in charge of collecting the toll paid by bulk carriers using the waterway and use those resources to pay for private dredging works.

In the current concession, the toll is collected by the private concessionaire.

Belgian company Jan de Nul and Argentine company Emepa are still currently in charge of the concession despite their original contract expiring at the end of April, as the government was forced to extend the concession for three months.

According to Gustavo Idigoras, head of grain exporters chamber CIARA-CEC, the toll charged to bulk carriers using the waterway should be collected by the private concessionaire and not by the state.

“If the toll is collected by the state, we all know what usually happens. The state transfer the resources to the Treasury, and the financial resources are then allocated to the waterway but also to other state programmes,” Idigoras told Agricensus.

“If this happens, the dredging company in charge of the operation could eventually run out of money and this could potentially result in higher tolls for exporters. Higher tariffs will mean lower exports,” he warned.

“We are urging the government to immediately call for a new long-term international tender to operate the waterway. If the government feels that it needs to carry out the tender in two different phases, this is a political decision by the government that we will not oppose. We need a new concession now as the extension of the current concession operated by Jan de Nul is about to conclude,” he said.

Daniel Nasini, head of the Rosario Grain Exchange (BCR) told local newspaper Infobae that it was imperative to guarantee the continuity of the service in the short term, especially given the extraordinary circumstances of the historic low water levels in the Parana river.

“For this, it is essential that the works remain in the hands of specialized companies in the field, selected under a rigorous and transparent bidding process. The state has neither the experience nor the technical capacity to carry out these tasks,” Nasini reportedly said.

The national government is expected to continue working on the technical and economic details of a new concession, which would have a length of 15 years, according to previous reports.

Three local universities are working to define the financial, technical and legal aspects of the future tender documents.

Dutch dredging companies Van Oord and Boskalis as well as Belgian companies Dredging International and Jan de Nul, and China’s CCCC Shanghai Dredging have expressed interest in the future long-term concession, according to previous press reports, although some radical sectors of the ruling coalition Frente de Todos are still urging the national government to fully nationalise the waterway.

The waterway encompasses 86 ports and conveys nearly 80% of all of Argentina’s agricultural exports, connecting ports in the Parana River with the Rio de la Plata river and on to the Atlantic Ocean.

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