Chinese port in Uruguay shelved

Shandong BaoMa Fisheries Group has shelved plans to build a port in the Uruguayan capital Montevideo that could accommodate 500 Chinese vessels at a time amid legal complications and strong opposition from local residents and environmental organisations.

The US$200 million project, which included a free trade zone, shipyard and fish processing and freezing plants on a private 28-hectare site in Punta Yeguas, a mostly rural area with a public park, required a change in the legal designation of the land.

“The initial project that we had in Punta Yeguas is not going ahead. The area is considered a rural area by the municipality of Montevideo and is not suitable for ports,” Julio López, manager of Shandong BaoMa, told Uruguay’s El País newspaper.

He added: “The government offered us another port but without giving us specifications. It was only an offer without anything formal.”

Chinese firm Shandong BaoMa has around 4000 employees and mostly has assets in fishing, fishmeal processing and port terminal management. It has also ventured into mining infrastructure.

Strategic location

Shandong BaoMa presented the port project in Montevideo in December 2018 along with representatives from CSI Ingenieros, its Uruguayan partner. The aim was to accommodate ships carrying up to 50,000 tonnes of cargo that fish in the South Atlantic.

Over 3,000 ships, many illegal, unreported or unregistered (IUU), visit the port of Montevideo every year in search of large populations of squid. Worldwide, only Vladivostok in Russia receives more IUU vessels, according to NGOs Oceana y Oceanosanos.

Since his inauguration in 2015, Uruguayan President Tabaré Vázquez has sought a closer relationship with China, even pushing for a free trade agreement between the two countries.

“Uruguay is the entry point to Mercosur and the whole of Latin America’s Southern Cone,” Vázquez wrote to Chinese president Xi Jinping in January.

With little information publicly available about the port project, residents and environmental organisations raised concerns about the social and environmental impacts of the port with government authorities.

“There was a lot of pressure and added to that was a pre-electoral period. The port will not be carried out in Punta Yeguas, but that doesn’t mean it won’t be elsewhere,” said Rodrigo García, founder of Oceanosanos, referring to upcoming presidential elections in November.

The port project has become a campaign issue and point of contention between lawmakers and presidential candidates.

García and a group of Punta Yeguas residents met with Daniel Martínez, candidate of the incumbent Frente Amplio coalition, to discuss the project.

The company encountered several difficulties in the change of zoning, add to the fact that the neighbours of the area do not accept the project

Juan José Domínguez, vice president of Uruguay’s National Ports Authority (ANP) said:

“The company encountered several difficulties in the change of zoning, add to the fact that the neighbours of the area do not accept the project.”

Dead in the water?

Despite problems at the original location, Shandong BaoMa’s port saga is not yet over.

Uruguay offered the company a concession of 30 to 50 years for the use of 180-hectares of ANP-owned land in Punta Sayago, just one kilometre from Punta Yeguas.

Though currently unused, the state has been readying the Punta Sayago site for sale. It already has a large storage unit and much of the necessary port infrastructure.

“Many projects have wanted to set up there in the past but have not advanced… The roads are already there, the area has been dredged, and there is even a cold store,” said José Martínez, a local port worker.

Shandong BaoMa has not yet responded to ANP’s offer.

Gabriel Otero, mayor of Montevideo’s Municipality A, where the new site is located, said Shandong BaoMa would only go ahead with the port if it were on private land.

None of those with knowledge of the project that Diálogo Chino interviewed for this article confirmed why Shandong BaoMa insists on developing the port on private land, rather than through a government concession. On state-owned land, however, there would likely be more restrictions on operations.

“By not answering, they imply that Punta Sayago doesn’t interest them. It is only one kilometre from Punta Yeguas, but the area is not the problem. They want the port to be on a property they own…Because of that, it isn’t going to happen,” Otero said.