Something fishy? Cargill to invest $130 million in Yushni PortAugust 18, 2015
A few days ago, your author bumped into the ever radiant Lily Lynch, owner of the Balkanist. Rather flatteringly a request for a few (hopefully erudite) lines was subsequently requested for inclusion in the Balkanist in the near future – albeit lines with little to do with the Balkans.
Today, those few lines were written relating to corruption schemes at the ports of Odessa, a brief look at the who’s who, the what’s what, and how far the scheme(s) climb up the nefarious Ukrainian hierarchical tree.
Upon completion and emailing, the first news read by your author related to Cargill confirming the long-known intention of a $130 million investment in Yushni Port, Odessa.
As such, this entry would be far better as a follow-on to the essay/article now in possession of the Balkanist awaiting editing if they decide to use it. If not, undoubtedly it will appear here some time in the future.
Just as Lord of the Rings trilogy was shown in cinemas prior to the making of The Hobbit, you now have a far less entertaining, but equally out of sequence entry.
Suffice to say, what currently sits with the Balkanist outlines the relationship between nefarious and corrupt goings-on at port terminals in collusion with, and also expressly instigated by the Customs and Borders, State Fiscal Service, Administration of Seaports of Ukraine, and the Ministry of Infrastructure. It also identifies suspicious roles and personal relationships from Odessa to those in Kyiv. Hence this entry would be better read post and not pre any Balkanist publication – but that’s life! After all you watched Lord of the Rings before The Hobbit.
Anyway the Cargill announcement was long expected, it is of course good news for Odessa, and Yushni in particular. Cargill is obliged to acquire 51% of the terminal to be built by MV Cargo and the new terminal will allow Cargill to ship up to 5 million (more) tonnes of grains and other goods per year.
Two things are striking about the announcement however, the first is that whilst the figure of $130 million is stated in the signed memorandum yesterday, the initial numbers mentioned by Prime Minister Yatseniuk were that of “about $100 million“ only one month ago.
Does an additional $30 million class as “about” on a forecasted $100 million project? Who costed the job so badly to be out by 30% upon initial costing? Can there really be an additional $30 million in client desired “extras” added in the course of a month from Mr Yatseniuk’s first announcement?
Having shipped from, and heavily invested in other ports in Odessa since 1993, Cargill knows very well what it is doing – and the nefariousness of the ports and associated authorities.
None are more nefarious than the Administration of Seaports of Ukraine currently headed by Andrei Amelin – who just happens to be a “Yatseniuk man”, and co-signatory of the Memorandum with Cargill.
This leads to the other striking issue. During the past 22 years it has managed to export enormous quantities of grain from Odessa ports that are nowhere near as deep as Yushni. Yushni is by far the deepest Ukrainian port at 18.5 meters, yet such a depth requirement has never been an issue for Cargill in all these years. In fact at 18.5 meters, Yushni is the deepest port on the Black Sea.
For some unknown reason, Andrei Amelin has stated the Administration of Seaports of Ukraine will dredge the bottom of Yushni port – despite it already being considerably deeper than existing ports that Cargill have invested in and work from.
So be it, although it would seem unnecessary prima facie and raises questions – At what cost the (actual verses invoiced) dredging? At whose cost the dredging? Part of a $30 million investment hike in the space of a month? An ask no questions, just send the invoice, way of facilitating the corruption chains that run from Odessa to Kyiv via the nefarious entity that is the Administration of Seaports of Ukraine?
Perhaps, coincidently (or not), Cargill having managed to rescue more than $100 million from Delta Bank when it liquidated, passing those losses on to the State Deposit Guarantee Fund and depositors with sums greater than the deposit guarantee – in short Ukraine – the deal was that the money would be reinvested in Odessa should the Ministry of Finance allow Cargill to save otherwise “dead” capital and turn it into capital that stands a chance of making a profit?
Keep these questions in mind, and await the Balkanist piece.