Malta has Iranian shipping line HDS in its sights

Malta Freeport is targeting Iran's shipping line HDS as it seeks to re-establish old ties
IRSL, now HDS, was until 2009 Malta Freeport's second-largest client
IRSL, now HDS, was until 2009 Malta Freeport's second-largest client

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Malta Freeport has renewed its contracts in Iran with Hafiz Darya Shipping Lines (HDS) in the expectation that sanctions will be removed later this year, according to Times of Malta.

Malta was until 2011 the Mediterranean hub of Iranian national shipping line IRISL, which operated more than 170 vessels before the 2009 sanctions on Iran over its nuclear program.

The shipping line started using Malta Freeport as its Mediterranean hub in 2004, ultimately becoming its second-largest client before Iran was hit with US sanctions in 2009.

The EU followed suit a few years later and IRISL unilaterally pulled out of Malta in 2011, in the knowledge that Malta would have to apply sanctions by 2013.

In an effort to circumvent the sanctions, however, the Iranian government had begun privatising many major state-owned entities in 2009 and IRISL’s operations were taken over by a private company – the Hafiz Darya Shipping Lines (HDS).

HDS’ contract with Malta Freeport predates the sanctions, and it continued to use the port for a few years until the growing number of Mediterranean ports that refused its ships entry forced it to abandon its Malta hub.

HDS continues to operate between the Middle East and the Far East, where sanctions are not applicable and trade flows were largely unaffected.

Numerous countries are knocking on doors in Tehran seeking to establish new, or re-establish old, commercial relationships once the sanctions are lifted, particularly for industrial development.

The loss of HDS had hit Malta Freeport hard but it gradually replaced the line with others, recently signing contracts with two worldwide shipping alliances.

However, shipping analysts say that HDS will need to work hard to re-establish itself on Mediterranean service loops where its container business has all been absorbed by other shipping lines.

Industry observers say it is likely that HDS will succumb to the same pressures that other shipping lines have faced, and form an alliance with major carriers on its key Mediterranean routes.

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