The National Ports and Shipping Agency (Anpyn), responsible for implementing the new dredging concession process waterwayhas published the tender document it intends to use. It is a document that includes more than 900 pages including its appendices. A short ten-day period has been opened to receive comments. The It will be the current government’s second attempt to achieve this goal and it is desirable that it does not fail.. The Hidrovía is considered a relevant case of the privatization program, which suffered delays. The previous concession expired two years ago and operations continued through contracts with the existing company.
The failure of the previous tender was related to this poor design of the selection process This gave rise to the interpretation that irretrievable advantages had been granted to a particular provider. Only one offer was received, which paradoxically did not come from the person who was supposed to be preferred. Perhaps there was an awkwardness, but it was not easy to avoid other, less convenient interpretations. For this reason, it is important that you acknowledge the mistakes you have made so as not to repeat them. The first step is to correct, to avoid conditions that are not relevant to the objective but limit competition and the number of bidders. For example, it is stipulated that only companies that can prove that they own six suction excavators built after 1994 and with a certain hopper capacity that are in operation are allowed to participate. The company must have dredged 15 million cubic meters after 2016, but only with its own equipment. Since the concession is an excavation service, a guarantee of compliance as well as solvency and solid experience should be required, which is less relevant if the equipment is owned or rented. This is not a concession that requires the successful bidder to build facilities or acquire machinery, which remains the property of the grantor. Once the concession expires, the excavators will be transported away and used at other destinations.
A further impact on competition will arise from the requirement to license the entire waterway, including the beacons, in a single contract. The concession can be perfectly divided into two differentiated sections in terms of the dredging depth and the characteristics of the equipment to be used.. One stretches from the Silver River until Timbues with greater depths and the other runs from this town northwards, to the mouth of the river Parana with the river Paraguay. Beacon can be an independent contract. With this or another division there would be more competition and fewer risks.
The document excludes the participation of dredging companies controlled by foreign states. Strictly speaking, this aims to avoid the involvement of Chinese companies and corresponds to a definition related to the government’s international orientation policy. The analysis of whether this approach is appropriate or not is on a different level. However, it cannot be said that this is a further restriction of competition which may lead to higher toll rates than would otherwise have been the case. And it must be clear that the level of tolls on the waterway is directly related to the export prices that agricultural or mining producers receive. This is also a strategic question.
The concession award process set out in the specifications is potentially a source of conflict. It involves a technical qualification combined with a score resulting from the toll rates indicated for each of the stages planned under the concession. Three envelopes are received at the same time. The first should contain background information and information about the company. The second part is a detail of the work and organizational methodology. The third list contains the specified tariffs, but they cannot be higher or lower than the maximum and minimum values already established in the specifications. The score to be awarded by the technical evaluation can reach up to 80, while the economic offer can reach a maximum of 120 and a minimum of zero. A maximum corresponds to the case where the lowest toll values of the strip are specified. Zero if the maximum values are given. Of the ten topics required in the first two technical areas, nine lead to qualifications and assessments that are subject to subjective and certainly opinion-worthy criteria.. A provider may receive a technical qualification that exceeds the one that follows, with a difference that cannot be discounted even at a toll rate that is at the lowest of the range. The award would then only be supported by subjective evaluations, which would be objected to both by the losers and by future users who might have to pay higher tolls than they would have resulted from other bidders. There will be momentum to challenge the price, with only one drawback: it requires a $10 million bond. An overly burdensome armor that gives rise to protest and certainly distrust.
The selection and award process should include an initial screening with the criterion “happened or didn’t happen“This will exclude those bidders who do not meet certain minimum requirements of capacity, solvency, experience and quality, measured by quantifiable parameters. Only the envelope containing the passerby toll quotas will be opened and the contract should be awarded to the one who offers the lowest tariff, excluding any minimum limits in the specifications. This would be the most transparent way to achieve the most convenient allocation.
There is time to correct errors to ensure a correct offer, without conflicts and distrust, with the best results and benefits for users and the country.
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