FIJI Ports Corporation (FPCL) has told the nation’s Competition and Consumer Commission its FJD 910 million, 10-year investment program will require new tariffs of up to 48% on certain international shipping services.
FPCL says it has an urgent cash requirement of approximately FJD 393 million for a capital works program focused on critical infrastructure upgrades, rehabilitation works, and capacity expansion initiatives across key ports.
Much of the Corporation’s core infrastructure was developed in the 1950s and is now supporting levels of throughput and vessel sizes far beyond its original design parameters, The Fiji Times reported.
“FPCL’s port infrastructure is operating under increasing strain due to age, capacity limitations, and evolving operational demands,” the statutory company stated.
“As a result, the current port system can be characterised as operating under heightened structural and operational risk, where continued deferral of investment will lead to progressive deterioration in performance, reliability, and safety.
“In practical terms, without timely intervention, these constraints may manifest in the form of increased equipment failures, berth limitations, congestion, and service disruptions to the broader Fijian economy.”
No changes are proposed to domestic tariffs to ensure domestic shipping and inter-island trade remain unaffected, FPCL said.
And the effective increase in the total revenue would be capped at 28% because several fee categories remain unchanged.
The Fiji Times did not detail which international services FPCL proposes to charge, and neither the FPCL or Fijian Competition and Consumer Commission websites have the submission available.
However, the FPCL’s financial analysis demonstrates that the proposed tariff adjustment will have minimal impact on importers and end consumers, according to the report. Port charges represent only 1-3% of total landed cost; and the proposed adjustment would result in less than a 1% increase in total import cost.
It stated that accordingly, the impact on the cost of living and business operations was expected to be negligible.
DCN has sought reaction from possibly-affected shipping lines.