The Manufactures Council for PNG (MCPNG) are applauding the Independent Consumer & Competition Commission (ICCC) for standing up for local businesses through the considerable savings in stevedoring and handling costs.
This comes at a time were the Manufacturers are struggling with inflation.
ICCC handed down the Final Report for the 2023 Stevedoring and Handling Services Pricing Review for Ports operated by International Container Terminal Services Inc (ICTSI) on the 12th of December, 2023.
According to MCPNG, for many years now, the council has worked with the Chamber of Commerce and Industry counterparts to raise concerns with the negative impacts of this monopoly contract. The overwhelming feedback from the primary producers, farmers, (including smallholders), manufacturers, building and construction, retail and extractive sectors has been that costs have escalated far beyond any gains in productivity.
ICTSI PNG, a foreign stevedoring company, has a 25-year monopoly concession to operate the Lae Tidal Basin in Lae under their subsidiary South Pacific International Container Terminal Ltd (SPICTL) and Motukea International Wharf under their subsidiary Motukea International Terminal Limited (MIT).
Chief Executive Officer for MCPNG, Chey Scovell, mentioned that this week's determination by the ICCC will return tens of Millions of Kina to all those businesses that move goods in or out of PNG. It will significantly ease pressure on the prices of goods and it will see more profits flowing back to their exporters – primarily farmers.
Despite having raised strenuous objections over the entire procurement process, to date ICCC has been hamstrung in reviewing ICTSI charges. Scovell said that the NEC of that time passed and approved this contract on the basis that it was going to reduce costs for the stevedoring at Lae and POM ports by at least 31 percent whilst at the same time vastly improving productivity.
“We do note that police have an active investigation, which has gone quiet, on ICTSI and others on the allegations of wrongdoing with regards to the procurement process and award of contract. Two governments and many iterations of Cabinet Leaders have failed to take up this important concern – but this week the ICCC has found the necessary conditions to act. And for that industry, and consumers are very grateful,” statement from Manufacturers.
The ICCC ruled the ‘regulated charges’ passed onto consumers were extremely high compared with similar services throughout the Pacific. The determination from the ICCC was that pricing should be immediately reduced and the ruling was subsequently gazetted by Parliament.
Furthermore, no additional “unregulated charges” can be applied by ICTSI for cargo services where there is an existing monopoly stevedoring operation.
Scovell is certain that the Rural Industries Council, the Agricultural Community, Farmers and Settlers Association, Poultry Industry Association, and the PNG Chamber of Commerce (including all its regional affiliates) would be joining the Manufacturers Council in applauding the ICCC’s ruling.