NCT management to be under joint venture

---

Jasim Uddin Haroon
The government has decided that foreign companies vying for taking over the management of the New Mooring Container Terminal (NCT) will have to form joint ventures with local companies.
The foreign operator will have 62.5 per cent shares in the NCT operation. The rest of the shares will be owned by local companies.
A foreign company will be eligible if it has experience in management of at least three terminals in more than one country over the last five years handling a minimum 0.50 million containers annually in a terminal.
On the other hand, an aspirant local financial institution of a company will not need such experience, NCT project director MA Sabur told the FE Wednesday in Dhaka.
"We have incorporated criteria in such a way that the country's financial institutions will be eligible to participate in the bid," he said.
The New Mooring Container Terminal (NCT) has been set up at a cost of Tk 5.0 billion by the Chittagong Port Authority.
Besides, the successful bidders will spend Tk 8.0 billion on equipment for the operation of the terminal.
The foreign operator, who will be selected through the bidding, will have to operate the NCT at least seven years and the highest, for 20 years.
The initial investment for the foreign operator will be at least $60 million.
The government wants to appoint an internally reputed port operator for the NCT so that the country's image and economy get a momentum.
"We will provide incentives for the foreign operators at a rate of 7.5 per cent for taking up a joint venture with local companies for the NCT operation," Sabur added.
But the local financial institutions will require to have the net worth proportionately.
We have set US$ 30 million as equity and the local financial institutions or any local corporate conglomerate need to have equity also proportionately.
"Local banks and corporate houses might be able to purchase at best 37.5 per cent of the NCT operational share," Sabur said.
"Suppose, any local bank wants to have 20 per cent shares in the NCT operation, then it will require Tk 420 million as equity," he added.
He also said the government will not allow any bankrupt or 'briefcase company' for "such a big project because the growth of the economy will largely depend on it," he added.
The NCT will be able to handle 1.0 million containers alone a year. Currently, Chittagong port is handling around 1.0 million through Chittagong Container Terminal (CCT) and other general container berths.
The Pre-Qualification (PQ) criteria for the NCT have been finalised and the Chittagong Port Authority (CPA) is likely to publish it shortly.
The government is expecting participation of at least 15 world-class operators in the NCT bidding.