Gdansk boxing clever as a new era dawns

07.10.2004

Lloyd's List, September 02 2004

Within six weeks, work on the new container terminal in the huge port of Gdansk will start - finally drawing to a close an era focused mainly on dry and liquid bulk.

"The prospects for our terminal are excellent," says port president Andrzej Kasprzak in an interview with Lloyd's List. "Poland's ports have a containerisation ratio of just 1.7% of their cargo. This will definitely change."

Gdansk could not stand by idle in this, he added - despite strong pressure from neighbouring Gdynia, which already has a flourishing container terminal. "Gdynia has a capacity of 350,000 teu. They want to expand that to 800,000 teu, but they will in the short run probably manage 500,000 teu. In Gdansk, we start with 500,000 teu and will go up to 1m teu," he says.

The terminal will provide two berths capable of handling panamax vessels, with one berth simultaneously providing ro-ro facilities.

The development of the Polish economy warrants such investments, Mr Kasprzak says.

This was evident from trends in Gdansk's current container trade, even though it was still small. "In 2003, we handled 20,000 teu. This year we had the same figure in the first six months alone." Gdansk was aware that it would probably not be the port of call for large mainline services. "But we want to be a major feeder port in the Baltic."

The new terminal is set to start operations in around three years. The port's partner is DCT Gdansk, a company formed by port and container management experts and companies from the UK, headed by James Sutcliffe. Total costs run to $175m, Mr Kasprzak says.

This includes $20m of infrastructure costs. They are initially paid for by DCT Gdansk, and reclaimed through lower rent, he says.

The move into containerisation comes at a time when two developments combine in a happy way for Gdansk - good traffic figures and the European Union membership, which will result in more spending on road and rail infrastructure.

"We have an excellent situation with regard to our cargo development," says Mr Kasprzak.

"Volumes are rising strongly. In 2002, we had 17m tonnes, this was up to 21.5m tonnes in 2003. Our forecast for 2004 is very optimistic. In the first half, we had 13m tonnes."

The strong performance was aided by Russian exports of crude oil and fuels, but also a rise in general cargo, particularly foodstuffs, and steel. Coal, once the staple diet of the port, is likely to drop from 7m tonnes to 2.5m tonnes this year. It is remarkable that Gdansk still maintained its high growth.

The second positive factor is Poland's European Union membership. It was true that this brought also some additional regulations, Mr Kasprzak concedes. "But we are not at all afraid of EU rules."

Brussels' determination to realise its transport corridor No 6, with Gdansk having a prominent place at one end of the corridor, was very helpful.

On the list of EU projects is the motorway Gdansk-Lodz-Katowice, which continues to Brno/Bratislava and Vienna, and the high-speed rail link via Warsaw to Vienna. "It will allow a speed of 180km/h," says Mr Kasprzak.

"We have two main infrastructure problems in Gdansk," he adds. "One is the rail and road access, the second is the water infrastructure. We need to maintain quays, access channels and so on." The EU had promised Zloty 150m ($41m) to help with these tasks. "This is very welcome. EU funds, of course, require that we pay 25% of the total costs." At present, the port is still struggling to come up with its Zloty 50m.

Mr Kasprzak came into power two years ago after a government change in Warsaw - which is frequently the reason for changes in top positions in Polish state-owned companies.

After all, the Treasury owns 83.84%, the municipality of Gdansk 2.04% and employees entitled to shares under the privatisation laws the remaining 14.12%.

His comparatively recent arrival makes it easier for Mr Kasprzak to be open about one of the main failures of port investments in recent years, the ill-fated huge grain terminal - which is standing largely idle with its silos and elevators. "This was bound to be a failure," he admits. There was not a large enough market for this type of terminal. "The very assumption that Gdansk could be the hub for Russian and Ukrainian grain imports was erroneous. They are not importing," Mr Kasprzak says.

The port terminated the contract with Europort, a company originally founded by the Saskatchewan Wheat Pool and now controlled by other private interests.

"There might be a use for it, though," Mr Kasprzak said. Instead of 3.5m tonnes, it would be 1m tonnes, and instead of 60 hectares, only 20. Instead of grain for Russia, it would deal mainly with feedstuffs for Poland, he said.

This article is copyright T&F Informa and is reproduced with permission. Reproduction, retrieval, copying or transmission of this article is not permitted without the publisher's prior consent. T&F Informa does not guarantee the accuracy of the information contained in this article nor does it accept responsibility for errors or omissions or their consequences.