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Our View: Benefits of port’s privatisation far outweigh the negatives

SPEAKING at Thursday’s House watchdog committee meeting, which was discussing the state’s agreements with the companies running Limassol port, Akel deputy Stefanos Stefanou said the following:

“The government turned Cyprus into a hostage of individuals who are today taking the profit from the port. There are very heavy responsibilities for the one-sided agreements, at the expense of the state and the public, the government signed for the port. The government must be made accountable, which is why the report of the auditor-general must be sent to the attorney-general so we can establish who is responsible and who will pay the price for these very bad agreements which are at the expense of the public and constitute a waste of public money.”

Nobody expected Akel to say anything else. It has always been ideologically opposed to privatisation and was bound to attack the privatisation of Limassol port even though this has proved very successful. The dividend for 2017, adjusted to 12 months because the contractor had control for 11 months, would come to €39.8 million (it was €36.4m) compared to €34.2m in 2016 when the port was still being run by the state-controlled Ports Authority. The average dividend paid by Limassol port in the period 2012-16 was €22.4m, significantly lower even though the recession may have had something to do with it. With the adjust the increase in the dividend, according to government technocrats, was 16.4 per cent.

But it is not only financially that Cyprus is better off after privatisation. The protection rackets operated by the all-powerful dock-workers have ended and the industrial action that plagued Limassol port and gave it such a bad name is now a thing of the past. How many days of the port’s operation were lost to industrial action in 2017? The year before, industrial action was a regular occurrence, costing the economy tens of millions of euro which was not included in the Ports Authority accounts. As for the allegedly one-sided agreement, Stefanou and the auditor-general mentioned, it would cost the state at most €50,000, according to ministry technocrats.

The only minus, objectively speaking, was that some of the port charges have gone up. Even on this it is not all bad. A representative of the Cyprus Chamber of Commerce explained that charges for some goods went up but for others went down. There were “compromises” on the charges said the Chamber’s representative, but for some products these were not satisfactory. It was never going to be perfect, but only the state ownership fanatics of Akel refuse to see the many benefits of the port’s privatisation that far outweigh few negatives.


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