Representatives of industry and agriproduct complex suggest Cabinet of Ministers of Ukraine cutting port dues by 20% in order to solve the lower competitiveness problem, in comparison with other ports of the region.
On 22 April they have written to Prime Minister Denys Shmyhal: “National shippers and forwarders encounter non-competitiveness of Ukrainian ports – firstly because of too high port dues level… The services of Ukrainian ports are from 2 to 4 times more expensive than those of the Chinese, Brazilian, Romanian ones, etc. Say, a handymax bulk carrier type vessel’s call at Pivdenny Port is twice as expensive as the average of the Black Sea harbours, and almost three-four times higher than at such competing ports as Hay Point in Australia, Vancouver in Canada, Tubarao in Brazil”, reads the letter.
It was noted that due to the dues rates in Ukrainian ports are set in US Dollars, to the contrast with other countries (Australia, China etc.), the Ukrainian manufacturer suffers additional pecuniary load.
Moreover, the funds gained from port dues by Ukrainian Sea Ports Authority (USPA) are not used for the infrastructure development and modernisation.
“In 2014-2018 only 23% of the collected port dues were invested, the rest of the monies were seized to the state budget either as income tax, or as dividends – 90% of USPA’s net profit is remitted to the fisc. During 2014-2018 over 50% of the dues collected were confiscated by way of income tax and dividends”, maintains the letter.
Thus, the undersigned suggest that port dues should be reduced in two phases: from 01 June 2020 on – setting 0.72 coefficient (i.e. shrinking by 10% of the current rates), and 0.64 (i.e. by 20% of the current rates) – from 01 January 2021 on, as well as cutting down the USPA net profit share to the budget from 90% to 30% – from 01 June 2020 on.
The undersigned are presidents of metallurgic, grain, chemical, fuel & energy and other federations and associations.
Earlier, Executive Director of Ukrainian Association of Producers of Ferro-Alloys and Other Electrometallurgy Products (UkrFA) Sergiy Kudryavtsev (having also signed the above letter) claimed the port dues of Ukraine the highest in the Black Sea – by more than 50% – and some the highest in the world.
“In Ukrainian ports each ton of cargo involves $2-$2.5 of disbursement expenses (and in Mykolaiv ports and terminals $4-$6 due to long canal passage)”, said the expert.
He stated that there are no economic grounds for such high rates, and their huge level has no effect on the port infrastructure development. “The state annually collects some 5-6BN UAH (~185-222M USD by today’s rate), but this is vaguely reflected on the port infrastructure”, stressed Mr Kudryavtsev.
He also mentioned that earlier port dues rates calculation techniques had been worked out jointly with the World Bank specialists, which had envisaged a 60% decrease of the current level. This could, to his opinion, create a serious economic impact in the mid term prospects thanks to more cargo flows drawn into Ukrainian ports.
https://cfts.org.ua/news/2020/04/22/snizhenie_portovykh_sborov_na_20_predlagaetsya_osuschestvit_v_2_etapa_58418
https://glavcom.ua/ru/news/portovye-sbory-v-ukrainskih-portah-odni-iz-samyh-vysokih-v-mire-ekspert-671895.html