IT WAS SMOOTH SAILING for projects in the
port sector—until the financial storm hit.
“Virtually everywhere in the world was rushing to add new capacity as fast as they could
because congestion was evident and ports were
having trouble keeping up with demand that was
racing ahead so strongly,” says Neil Davidson,
director of ports at Drewry Shipping Consultants
Ltd., London, England.
The expansion of the Panama Canal will mean new projects.
port projects with a combined value of $11.5 billion. The list includes a $2.3 billion second phase
of construction at Morocco’s Tanger Med terminal
and a $1.3 billion project at Jebel Ali in Dubai.
“A lot of deliverables remain uncertain, which
makes it a difficult climate for project managers,”
Mr. Davidson says. “Project managers have to
make sure that they are as well-informed as possi-
ble, that they take good, expert advice, and that
they ultimately form their own
informed opinions about the most
Even with the instability, the port
construction sector in the Middle East
remains strong, he says. The value of
current and proposed port projects in
the region (including North Africa)
surged to $46.5 billion in 2009, up
from $44.8 billion in 2008, according
to MEED Projects. Qatar leads the
pack, with $11.5 billion worth of
projects underway, including the $7 bil-
lion New Doha Port scheduled for
delivery in 2023.
Then the global financial markets crashed and
took cargo shipping numbers down with them.
“Globally, we saw container port sector volumes
decline by about 10 percent in 2009 from the
previous year,” Mr. Davidson explains.
With that drop, many port projects found
themselves treading murky waters.
In the Middle East, for example, Dubai’s massive
debt issues have put some port projects on hold.
“Port financing has taken a bit of a hit, but
that’s not a bad thing,” Mr. Davidson says. “What
we were finding through 2005 to 2007 was that
there was so much buoyancy in the market and so
much easy credit that so many port projects were
coming forward, it was slightly crazy.”
Business intelligence firm MEED Projects
reports delays on at least a dozen Middle East
Even with the recession pushing cargo
volumes down, the massive Panama
Canal expansion project has sparked a
flood of port projects in locales that
could benefit from the resulting spike
in shipping traffic.
In the United States, the list includes a
10-year, $3 billion modernization of the Port of
Long Beach, California; $600 million in upgrades
at the Port of Mobile, Alabama; and an eight-year, $500 million expansion at the Port of
“Those who are best prepared when the recession ends will have the best opportunity for
rewards later,” Don Allee, executive director and
CEO of the Mississippi State Port Authority at
Gulfport, told USA Today. Leveraging its prime
spot on the Gulf Coast, the port is undergoing a
$570 million expansion.
The Panama Canal megaproject will also mean
development of new shipment facilities—and
potentially new port projects—in the Caribbean
and on the west coast of South America, says Jim