Argentina Sees Contentious Debate Over the Paraná Waterway Concession

During an intense session before the Transport Commission, Iñaki Arreseygor, Director of Argentina’s National Agency for Ports and Navigation, claimed that there was a coordinated effort—what he called an “orchestrated scheme”—to sabotage the most recent tender for dredging and buoyage services on the Paraná-Paraguay Waterway.

“We are defending the interests of producers, but every day of delay increases their costs,” he said. As a commodity-exporting nation, Argentina does not set the prices for the items it sells. Today, producers are dealing with logistics cost overruns that could be mitigated through deeper drafts and wider channels, reducing congestion and delays.

The government had expected at least four major bids alongside 11 smaller firms partnering with them. However, on the day of bid opening, only Belgian company DEME submitted a proposal—a “surprise” that raised suspicions of external pressure discouraging other firms from participating.

This latest setback adds another chapter to the long and troubled history of Argentina’s main export corridor. For over 15 years, dredging and buoyage contracts have failed to deliver a transparent and modernized waterway. The Waterway—which handles 80% of the country’s foreign trade—requires consistent depth maintenance to ensure safe navigation for the vessels carrying Argentina’s imports and exports.

An Endless Saga

The first concession for the Paraná-Paraguay Waterway was awarded on February 21, 1995, transferring dredging and buoyage operations to the private sector. The contract allowed for toll collection by Jan De Nul (dredging) and Emepa, an Argentine company led by Gabriel Romero (buoyage). Together, they formed Hidrovía Sociedad Anónima.

Fifteen years later, in 2010, the government—through Decree 113/2010, signed by Cristina Kirchner, Aníbal Fernández, Amado Boudou, and Julio De Vido—renewed the contract until April 30, 2021, instead of launching a new bidding process. However, in 2018, Gabriel Romero admitted in court to paying $600,000 in bribes to secure the extension. Jan De Nul denied any involvement, and the partnership eventually dissolved.

During Alberto Fernández’s presidency, a failed and controversial tender led to the nationalization of dredging and buoyage operations. The now-defunct General Ports Administration (AGP) took over toll collection but continued contracting the same companies that had been operating since 1995. The result? A $80 million debt to Jan De Nul, which remains unpaid.

Under Javier Milei’s administration, a new 30-year concession process was launched. The government projected annual revenues of up to $410 million, more than double the historical average of $200 million. Despite being an attractive business—drawing interest from leading global dredging companies—only DEME submitted a bid. The tender collapsed amid accusations and counter-accusations, with the government announcing an investigation into the lone bidder. “It’s like inviting several people to your birthday party, but only one shows up—so you get mad at them,” an industry leader told La Nación.

With global importers and exporters watching in disbelief, the stakes remain high: keeping the Waterway operational for the vessels that transport Argentina’s trade. The waterway urgently needs dredging and widening to accommodate modern, large-tonnage vessels, preventing surging freight costs and costly delays that result in multi-million-dollar losses. Despite its strategic importance, Argentina has yet to secure an intelligent, forward-looking contract that includes the necessary upgrades.

Why the Tender Failed

The possibility of bid rigging—as suggested by some dredging firms—remains under investigation, as does the government’s claim that the sole bidder engaged in misconduct. Beyond these disputes, the tender contained numerous technical and financial requirements that may have deterred potential bidders. One example: companies were required to have salvage and wreck removal experience over the past 10 years. “What does that have to do with dredging?” an operator asked La Nación.

A letter from Jan De Nul to the government sheds further light on the issue. The company dismissed allegations of preferential treatment, citing an unrealistic submission timeline and economic concerns. The letter highlighted expanded concession requirements, such as the installation and maintenance of security and surveillance systems, which go beyond traditional dredging and buoyage responsibilities. “These changes add significant costs and require subcontracting specialized providers,” the company stated.

Jan De Nul also expressed concerns over data transparency, fearing that submitting a bid would have exposed sensitive financial information to competitors in a high-risk process with uncertain outcomes.

For its part, DEME, the only firm to submit a bid, emphasized that multiple companies had voiced complaints about the process—including the Argentine Industrial Union (UIA), the Chamber of Private Ports, the Port Council, and members of Congress. DEME and Jan De Nul are known for their intense rivalry in global dredging contracts.

Meanwhile, Dutch dredging giant Boskalis also objected to the process. The government dismissed its complaint as “unfounded,” but the company called for the tender to be scrapped, citing alleged favoritism and other procedural issues.

Additional concerns included the requirement for bidders to absorb Jan De Nul’s unpaid debt, high financial guarantees, and the steep costs of security measures, including drones and 30-kilometer-range surveillance cameras. One executive told La Nación: “Under the current terms, the winning bidder would be operating at a loss for five to six years.” He estimated that, in the first two to three years alone, the contract would require an initial investment of $170 million—excluding dredging costs.

What the Users Say

Key stakeholders along the Waterway have expressed their concerns about the urgent need for a viable solution.

“The top priority is to reduce current toll rates and ensure a 40-foot navigable draft from Timbúes to the ocean, while maintaining an environmentally sustainable waterway,” said Guillermo Wade, Executive Director of the Chamber of Port and Maritime Activities (Capym), in an interview with Reuters.

Users also demand channel expansions, smart buoyage systems, and a robust environmental impact study to protect the ecosystem. Many suggest a shorter concession period—around 15 years—with toll rates capped at $5 per tonne.

Local exporters insist on expediting a transparent bidding process. “This issue cannot be delayed any further,” said Gustavo Idígoras, president of the Chamber of Agro-exporters (Ciara-CEC). “This has been an unresolved demand for 15 years. We need an international, transparent, and privately funded tender process without government backing. A new bid should be drafted within three months, and a winner should be selected within 90 days,” he urged.

While the government rushed to release the tender, Idígoras noted that many industry concerns were ignored. “We had multiple meetings, and while the government tried to incorporate some of our suggestions, the timeline was too short.” He added that “many companies raised objections” and emphasized the need for genuine competition to achieve the best pricing and service quality.

On the issue of toll pricing, Idígoras stressed: “We sell a product worth $200 per tonne. The toll matters. Historically, rates ranged from $2.80 to $3.06 per tonne. Today, it’s $4.30—an exceptional increase caused by unpaid government debts.” He proposes capping the toll at $5 per tonne while ensuring 40-foot navigability.

“The government must prioritize a competitive and transparent tender to secure the Hidrovía’s future,” said Daniel Funes de Rioja, president of the UIA. “This is an urgent matter that requires immediate resolution.”

By Paula Urien

Source: La Nación

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