Cyprus Mail

Shipping agents raise concerns over plans to privatise Larnaca port

File photo: Yiannis Karousos

Shipping agents on Tuesday expressed concerns over the government’s goal of privatising Larnaca port, the only one left under full state control, expressing fears for the repetition of the mistakes made with that of Limassol.

In his address at the Shipping Agents Association annual general meeting, the group’s chairman Panayiotis Christodoulou said the Cypriot port industry is at a crucial crossroad and the decisions the state is called upon to take will be extremely important for the immediate future.

Christodoulou said Larnaca port is the only one under complete state control today and for that reason the association was concerned over the government’s plans for its privatisation.

Among the serious problems faced in Limassol, Christodoulou said were the unregulated tariffs on general and other similar loads as well as the lack of personnel and mechanical equipment.

“Although there are good prospects for attracting transit cargo through Limassol port, the costs are prohibitive because of the rights the state collects on the tariffs of the managing companies, and in particular 52.1 per cent from DPWL and 62.7 per cent from Eurogate,” he said.

In fact, he said, traffic plunged, from the 49,799 Twenty-Foot Equivalent Units (TEUs) in 2016 to just 1,000 TEUs this year.

He said some steps have been made on some issues that have risen after privatisation, but cooperation from everyone was necessary for further improvement.

Christodoulou expressed serious doubts regarding the timeframe of government plans for the construction of a new industrial port in Vassilikos, for which works are expected to start in 2024.

While the port’s construction is delaying, there is a low-cost proposal by the Ports Authority for the conversion of that of Larnaca to a multiple use port within 20 months, he said.

“It is mind boggling why the government does not give the green light for the implementation of the economically advantageous proposal by the Ports Authority which will provide solutions and prospects for a multiple form of development of the port of Larnaca within a short period of time,” he said.

Transport Minister Yiannis Karousos, referring to the Limassol port’s privatisation, said that the results so far have been very satisfactory. “I don’t claim that there are no problems, or that they will cease to exist. Our concern at the ministry is to monitor problems and prevent or resolve them to the degree this is possible and legally feasible,” he said.

Referring to the privatization of Larnaca port, Karousos said that due to the project’s importance the ministry opted for concluding a concession agreement with the only preselected financial entity that also participated in the last procedure, in line with the relevant legislation.

He also said that the new industrial port at Vassiliko will be built with the DBFOT method (Design, Build, Finance, Operate, Transfer).

Shipping Deputy Minister Natasa Pilides read President Nicos Anastasiades’ address. The president said that shipping is a valuable asset for Cyprus, generating an annual revenue that corresponds to 7 per cent of the overall GDP. He also noted that 3 per cent of the total workforce works in the broader shipping industry, while the Cypriot fleet is one of the largest in the world.

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