DP World has reached an agreement to manage the Berbera port in Somaliland, which would allow it to become a major hub for goods to transit to and from the Horn of Africa, the Wall Street Journal reported.
DP World signed a US$442 million agreement with the government of Somaliland to develop and operate a regional trade and logistics hub at the Port of Berbera.
Under the terms of the deal, the newspaper citing a person who has seen the document, Somaliland will grant the Dubai-based company the right to manage the Red Sea port
of Berbera for 30 years.
DP World is bullish on Africa and will expand further across the continent following a deal to create a new gateway in Somaliland, on its eastern coast.
"I am very bullish about Africa and I believe it still has a very huge potential," the DP World chairman Sultan bin Sulayem said.
"The reason why we go to Africa is because we get a lot of knowledge and experience and they are the two factors for success."
The agreement comes as part of a larger government-to-government memorandum of understanding between the Dubai and the government of the Republic of Somaliland to further strengthen their strategic ties.
DP World has existing operations in Senegal
, Egypt, Mozambique
, Djibouti and Algeria, and Berbera port will be the eighth DP world operation in Africa when completed.
Over past five years DP World has invested over $1 billion in capex and added 2,275,000 twenty foot equivalent units (TEU) of capacity at its terminals in Africa, bringing the total annual capacity to 6.2 million TEU.