Israeli diplomatic pressure on Germany has led to German supply chain logistics consultancy Hamburg Port Consultancy (HPC) pulling out of a contract to renovate the Iranian port of Bandar Abbas, which the company signed in January 2010.
Israel’s ambassador to Berlin, Germany, Yoram Ben Ze’ev, told officials with the German Foreign Ministry and the German chancellor’s top aides that Iran had used the port for exporting weapons to Hezbollah in Lebanon and Hamas in the Gaza strip, reports Israeli newspaper Haaretz. Ben Ze’ev stated that weapons found on the Francop vessel, which was seized Israel Defence forces in the Mediterranean, had disembarked from the port of Bandar Abbas.
The Israeli ambassador to Germany was reported by Haaretz as stating that the German company’s contract to renovate the Iranian port was viewed by the Jewish state as ‘German assistance to an Iranian arms deal with terror organisations, and a violation of U.N. Security Council resolutions.’ The paper reports that German officials contacted HPC and that the contract with the Iranian port has been terminated.
A contract between HPC and the Bandar Abbas port operator Tidewater Company had been agreed on January 9 2010, according to the Fars News Agency. According to BMI research, HPC was likely to have worked on the second phase of the second container terminal at the Shahid Rajaie port complex, which is due online in 2010, and is to boost capacity at the facility to 3.5mn 20-foot equivalent units (TEUs). The Fars News Agency reports Tidewater Company’s managing director, Abdolhamid Malahzadeh, as stating that HPC was set to replace the Singaporean firm Overseas Port Management (OPM) as the port’s manager, as OPM’s contract was coming to an end.
BMI notes that HPC pulling out of the contract is bad news not only for the German company, but also for the Iranian port. HPC is an independent company within the Hamburger Hafen und Logistik (HHLA) group, which operates the German port of Hamburg. HPC has been expanding its port operations, with a subsidiary named HPC Ukraina holding a stake in the Ukrainian port of Odessa. The Bandar Abbas project would have seen the company move out of Europe and into port operations in the Middle East.
The contract’s cancellation is also bad news for the development of the port of Bandar Abbas. The port is in southern Iran and handles 90% of the country’s container throughput. The port is operated by Tidewater, but a separate concession manages the Sharhid Rajaie port. BMI fears that the planned second phase of development of the port’s second container terminal could now be delayed after HPC pulled out of the contract. BMI also warns that the episode highlights that the Iranian port’s pool of potential contractors is limited, as Israel has already shown that it will intervene and use its diplomatic influence where it can to hamper the development of a port that it feels plays a role in Iran’s illegal weapon exports.
BMI notes that this is not the first time that Iran’s maritime operations have been caught up in politics. Iranian shipping company Islamic Republic of Iran Shipping Line (IRISL) had sanctions placed upon it and its subsidiaries in 2008 by the US Treasury Department, which accused the line of providing logistical services to Iran’s Ministry of Defence and Armed Forces logistics (MODFL). The department also stated that IRISL’s actions were part of a broader pattern of deception and fabrication that Iran uses to advance its nuclear and missile programmes. In October 2009 the UK Treasury ordered that ‘UK financial services cease all business with the IRISL,’ under the Counter Terrorism Act 2008.