EU Company Granted Concession for Croatian Port Terminal After Cancellation of Tender With Chinese Bidder

By Ella Kietlinska
Ella Kietlinska
Ella Kietlinska
Reporter
Ella Kietlinska is a New York-based reporter for The Epoch Times.
November 11, 2021 Updated: November 11, 2021

A 50-year concession for the development and economic use of a new deep-sea container terminal in the Adriatic port of Rijeka in Croatia has been granted to a European company.

The concession contract to build the necessary infrastructure and fully equip the Zagreb Deep Sea container terminal in the port of Rijeka—the biggest seaport in Croatia—as well as for the terminal’s economic use was signed on Friday, according to a statement from the City of Rijeka.

The concession, estimated at an equivalent 2.6 billion euros ($3 billion) with the annual concession fee fixed at 2 million euros ($2.3 million), has been granted for a period of 50 years to European company APM Terminals, which runs more than 70 port terminals around the world.

APM Terminals is a part of Maersk, a Denmark-based container logistics company operating in 130 countries.

Under the agreement, APM Terminals will own 51 percent of the Rijeka terminal while the remaining 49 percent will be held by the Energia Naturalis Group (ENNA), the concession holder, according to Ship-Technology. ENNA is a private Croatian investment company operating in the energy, infrastructure, and transport sector.

Croatian Prime Minister Andrej Plenković said at the signing ceremony that the concession contract created the conditions for Rijeka to take a leading role in cargo transshipment in the northern Adriatic and to become the most important sea exit for central and southeast Europe, the statement said.

APM Terminals CEO Morten Engelstoft said in a statement, “We are confident that Rijeka Gateway [the project for a new container terminal in Rijeka] will become an important spot on the port logistics map, serving not only Croatia but also the wider Central Europe region.”

Owner and president of the board of ENNA said the project to build the new container terminal in Rijeka and the modernization of the railway infrastructure is Croatia’s largest national project that will facilitate “business opportunities and fast economic growth not only in logistics but in all services and all industries,” according to the statement.

In 2020, a consortium of three Chinese companies proposed a bid to build the new container terminal in Rijeka in five years with an annual concession fee of 2 million euros ($2.3 million) in response to a tender launched by the Rijeka Port Authority, according to RailFreight.com. The second bidder—APM Terminals in cooperation with ENNA—offered to complete the terminal in 10 years and pay 1 million euros ($1.1 million) in concession fee, the same source said.

However, the Rijeka Port Authority canceled the tender in January without providing any reason and launched a new one, reported Total Croatia News.

In the second tender, only one bid was received. The bid, made by the consortium of APM Terminals and ENNA, was accepted.

The new container terminal should become operational within 3.5 years when the first phase of the project is expected to be completed. After the completion of the second phase the terminal will have a projected throughput of more than 1 million TEU (twenty-foot-equivalent units), a statement from APM Terminals said.

A TEU is a standardized unit of measurement used to determine cargo capacity for container ships and terminals based on a 20-foot long container.

Croatia is a member of the European Union and NATO.

Chinese Influence in Balkans

Epoch Times Photo
A bridge under construction on the Croatian Adriatic near the village of Komarna on Aug. 2, 2020. The bridge was being built by the Chinese state-owned China Road and Bridge Corporation. (Denis Lovrovic/AFP via Getty Images)

According to EURACTIV.hr, apart from Rijeka, China recently lost two other north Adriatic ports with Trieste in north-east Italy making a deal with Hamburg and the Slovenian port city of Koper making a deal with Japanese companies.

Chinese state initiative China-CEE Institute, based in Hungary and established by the Chinese Academy of Social Sciences (CASS), stated in a paper (pdf) published in July the importance of the Adriatic for trade.

“The Adriatic Sea has … been an important entry for the European continent since it comes closer to the central European region than any other part of the seas surrounding the continent,” the paper said.

“Due to their geographical location and other factors, the ports in four countries that surround the Adriatic (Italy, Slovenia, Croatia, Albania) are an important group, among the most important cargo hubs in Europe,” it said.

“In Croatia … the most important port for goods is Rijeka,” the paper said.

Vladimir Shopov, a visiting policy fellow at the European Council on Foreign Relations (ECFR), wrote in a paper that the Chinese consortium bid in 2020 to construct the terminal at Rijeka was in line with Beijing’s continued efforts to strengthen its position along the Adriatic coast through various infrastructure projects, including ports, railways, and roads.

He pointed out the dangers in this.

“If governments in the Western Balkans are unable to pay Chinese loans for such projects, they could be contractually obliged to transfer ownership of various ports and land assets to Beijing. This would provide China with some real leverage in the region,” he wrote.

“While most Western Balkans states have manageable debts, China accounts for a rising share of these liabilities—roughly 15 percent in Serbia and Bosnia, more than 20 percent in North Macedonia, and more than 40 percent in Montenegro,” Shopov added.

He wrote that China gained a degree of influence over the maritime infrastructure of south-eastern Europe by taking control of the Greek port of Piraeus in the aftermath of the 2008 financial crisis.

Ella Kietlinska
Ella Kietlinska is a New York-based reporter for The Epoch Times.