16 March 2005

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Government plans to reduce port charges by 25 per cent
By Kurt Sansone

Industry and the business community may see a drop of around 25 per cent in port charges, according to government plans to reform work practices pertaining to the various service providers operating in the Grand Harbour.
The first sign of the wide-ranging reform will come by the end of this month when Government plans to issue a call for expressions of interest for the handling of cargo, which is currently handled by the GWU-owned Cargo Handling Company.
The GWU company has enjoyed a monopoly for years on end, since its contract was renewed automatically by subsequent administrations.
Government intends issuing a competitive tender for cargo handling operations but says only one company will be chosen to act as a terminal operator. The Cargo Handling Company’s contract expires in 2006.
But cargo handling is only one facet of port reform, Competitiveness Minister Censu Galea told The Malta Financial and Business Times .
Current tariff structures that date back to the times when most of the port work was done manually make the Grand Harbour the most expensive port in the Mediterranean.
“Our aim is to offer a competitive tariff package that would in turn attract more work to Valletta’s quays,” Galea said. The overall tariff package for industry would be reduced by around 25 per cent, the minister said, not ruling out bigger savings.
“Reforms will have an impact on all service providers operating in the Grand Harbour such as mooring men, port workers and stevedores in a bid to shave off additional costs that have hampered importers and exporters for decades,” Galea said.
Government has had meetings with the Federation of Industry, the Chamber of Commerce and other constituted bodies and is currently engaged in talks with the current service providers.
Government has also commissioned two studies outlining an economic and financial model for the Valletta port. “The economic model is ready and the financial study is soon to be concluded. We hope that in the coming months we would start implementing change,” Galea said.
The studies analyse the current situation and outline measures and structures to make the port more efficient and cost effective. They also delve into the possibility of utilising the available infrastructure to its full potential.
Industry has long complained that it is cheaper to bring over a container from Holland to Malta than transporting that same container from Valletta to any industrial estate. And it is not just the GWU’s Cargo Handling Company that contributes to this state of affairs.
Different service providers have different tariffs and the reform hopes to cut down on outdated work practices that have crippled industry.

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