Privatization of ports, an effective strategy for development

The PSO has started to ease the regulations and the tariff system of the ports in an attempt to provide a modern competitive atmosphere and come out of traditional methods of business.

Of course, it has been hard to enforce the development plans since there has been a shortage of strong management and facilities so far. So, it is of much importance to review the activities done in the ports comprehensively as the places of great potentials for international trade.

The PSO has now entered the very first phase of development by offering amendment plans and privatization plan of the ports. It does not mean that the previous management had done nothing in this regard but it is considered a new chapter ever happened over the past two and a half decades.

The privatization of ports and the amendment of tariff laws are important since:

1. The amendment will let mother vessels to traffic much more into the Iranian southern ports like Bandar Abbas from huge ports around the world. Mother vessels not used to traffic in Iran’s water due to the high tariff rates used to be imposed to them before. So, the giant vessels preferred other Persian Gulf ports such as those of Oman and Dubai rather than those of Iran where only feeder vessels were trafficking.

2. The privatization plan will change traditional methods that used to be applied in the ports. For instance, the importers used the ports as their warehouses only but the imported goods tariff is rationalized now and therefore, the transit of goods are allowed to be stored for five days only, the imported goods for 10 days and the goods for export for 15 days. Storing goods for longer times will cost the owners heavily. The average storage time in the world differs between 5 and 7 days.

3. Rationalization of tariff rates will force owners of goods not to hoard the goods in the warehouses for a long time causing several problems for the public and national economy.

4. The amendment of the regulations would bring the southern ports out of isolation if an efficient management is enforced at the same time too.

5. The new tariff system will be closer to regional standards and make the market more competitive.

6. The transit activities will be developed in the country. For example, the transit of goods shows an 84 percent growth this year compared with last year.

7. It will create a considerable number of job opportunities.

However, a cohesive cooperation is expected from all related governmental organizations in order to provide a competitive condition in the commercial ports across the country.

ARA/MA

END

MNA