Djibouti’s rivals head to court

By Patrick Smith in London
Posted on Thursday, 8 January 2015 16:26

The finale of a tortuous legal battle with political overtones is due to be played out next October in London’s High Court.

[He] awarded construction, security and other contracts to companies he owned

Behind the action is President Ismail Omar Guelleh’s government: its target is Abdourahman Boreh, the former chairman of the Djibouti Port and Free Zone Authority and erstwhile opposition presidential candidate, from whom the government is claiming $150m in lost earnings.

But in an interview withThe Africa Report, Boreh accuses Guelleh of presiding over an oppressive regime of obscene corruption, which he says is driving out investors.

“We used to have three petroleum companies: Mobil, Shell and Total. They all left Djibouti. [Guelleh] also condemned Total to pay €90m ($111.8m) [in fines]. At the end, three major multinationals left with all the economic impact and the employment they used to create.”

What started as a rivalry between Guelleh and Boreh has escalated into another multi-million-dollar lawsuit, dragging in one of the largest ports companies in the world, DP World, which was brought in to run a container terminal.

The government accuses DP World of “illegality” and “corruption”, and has filed a claim against it at London’s Court of International Arbitration, also to be heard next October.

The case will scrutinise the corporate governance of DP World and shine a light on business practices in Dubai, which is a key commercial hub for Africa.

DP World’s senior vice-president for communications Sarah Lockie says the company rejects Djibouti’s allegations and would “vigorously defend its position” in the hearings.

Roble Olhaye, Djibouti’s ambassador to the UN, sets out the government’s case against Boreh: “During his time as chairman between 2003 and 2008, Boreh obtained significant shareholdings in several projects. [He] awarded construction, security and other contracts to companies he owned and demanded commissions from other individuals and companies involved.”

After Boreh left Djibouti in 2008, the government launched a case against him for tax evasion.

“We believe Mr Boreh has taken millions of dollars from the Djibouti projects and hidden them in countries all over the world,” says Hassan Issa Sultan, Djibouti’s Inspecteur Général d’Etat.

That version runs counter to a deal between Boreh and Guelleh, according to Boreh’s defence case.

Boreh claims that after he made a substantial donation to Guelleh’s election campaign in 1999, they discussed a plan to develop Djibouti’s port into one of the region’s busiest, modelled on Dubai’s success.

From the beginning, Boreh says, it was agreed he would be a co-investor in the port development and his companies would benefit accordingly. ●

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