MercoPress. South Atlantic News Agency

Paraná Waterway crisis expected to be sorted out this year

The AGP's balance sheets are expected to be sorted out sometime this year

An extension of the Paraná-Paraguay Waterway Management to Jan de Nul has been reported to be under consideration as the need for further dredging plays a compelling role.

 Argentina's General Ports Administration (AGP) was found to be deeply in the red for almost US$ 80 million with the Belgian dredging company for unpaid services since the State reclaimed control of the key transport scheme in 2021 after the agreement ended. President Javier Milei's Government ordered this debt to be canceled at the earliest. Hence, Jan de Nul's remaining or being granted additional work for four more years is not to be ruled out.

Given the sloppy and hasty way the AGP reclaimed control of the Waterway's management under former President Alberto Fernández, current authorities are eyeing an additional tax of between 30 and 63% linked to the ongoing VAT collection in a move to balance things out. The Economy Ministry is yet to come up with a definition on the matter as letters of protest have already been received from Waterway users grouped under entities such as the Oil Industry Chamber and the Rosario Stock Exchange, among others.

According to local media, it was rumored within Government circles that Jan de Nul had been deemed necessary for some improvements the trunk navigation system urgently requires. In return for the additional surcharges, users are expected not to object to them given the better operational conditions to become available. Hence, there would be no “buts” to postponing the bidding process to find a successor to Jan de Nul. In this scenario, Belgium's Deme Dredging has also offered a mechanism to take over the AGP debt, it was explained.

When the private concession ended, the AGP took over the administration of the waterway, but since it did not have the technical ability to provide the services required, it went on to hire on a “temporary” basis and with no tenders the same private companies already supplying them: namely Jan de Nul's dredging, and Emepa's beaconing, which has raised objections from the National Comptroller's Office.

In other words, Jan de Nul would no longer manage the Waterway but would remain as a third-party contractor within the structure, whereas Emepa won a “short tender” for beaconing, which formally ended in December 2023. Under the present scheme, the current understanding between the AGP and Jan de Nul expires when new operators are found through a new bidding process, which Milei's Government has pledged to carry out before the end of 2024, during which time the AGP's balance sheets are expected to be sorted out.