Financial News and Economical Crisis

Draft Resolution of the Cabinet of Ministers, which proposes to reduce port fees in Ukraine by 30%, was issued on Friday at the Economy Ministry. The paper notes that the cost of vessel calls at ports of Ukraine in 1,5-2 times higher than in other ports of the Black Sea basin. Unbalanced tariff policy in the sphere of specialized services to the ports reduces the competitiveness of domestic ports, re-directing the cargo to the ports-competitors.

According to the Ministry of Transport, in 2009 the turnover of our ports has decreased by 17%. However, despite this, Ukraine has managed to attract a part of transit cargo, which previously went through the ports of Russia, Romania, Georgia and Bulgaria. Deputy Minister of Transport and Communications Michael Chubaj said that he considered an adequate tariff policy and a “matter reduction of port charges is not relevant.”

The ports themselves argue that the reason for the fall of their performance - not to fees. “Right now, port charges in Ukrainian ports are compatible with the charges that exist in the ports of the Black Sea: Turkey, Russia, Bulgaria, Romania and other”, - says head of Kherson Commercial Seaport Andrei Yegorov. Head of the Odessa Commercial Sea Port Nicholas Pavlyuk recalled that prior to August 2008 prices in Ukrainian ports were too low compared with other countries, so the Cabinet decided to raise them by 58%. For example, according to the Ministry of Transport, the tariff on steel handling in Ukrainian ports 1,5 times lower than in the ports of Romania, and by 15% - than in Novorossiysk, and the tariff for handling of coal - in 1,7 times lower than in Romania and 8% - than in Novorossiysk.

director of information-analytical center BlackSeaTrans Valentina Mikhailova says that the main reason for reducing turnover and vessel calls at ports - a financial crisis. “The volume of traffic fell all over the world,” - she said. “The decline in economic activity in the world could not but lead to a decline in export-import operations in Ukraine”, - director of the Center agrees to the political and economic analysis, Alexander Cava.

While the rate cut will lead to an increase in port calls, there is a risk that it will not increase revenue, said Mr. Kawa. “Today it is impossible to predict, be it through increased ship calls and transhipment offset a reduction in port charges. This requires almost comparable to the growth of turnover”, - said Andrei Yegorov.

As recalled by a member of the Parliament Committee on Transport and Communications Vitaliy Korzh, an attempt to reduce port charges in the Novorossiysk port in the II half of last year led to the fact that the total income of the port, in contrast, have fallen over the period by 25%. This income is the port in the I half when the situation on the world market, Handler was worse, declined only by 17%. “The reduction of port charges could also adversely affect the investment projects of ports, which are now aimed at to improve the quality of infrastructure and increase handling in the future” - he said.

Alexander Chernovalov

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