The issue of increasing product transit charges and the impact on trade and business were discussed today in the Parliamentary Committee on Energy, Trade, Industry and Tourism. The increases could contribute to rising inflation and must therefore be addressed, the Commission said.
The Chairman of the Committee, DISY MP Kyriakos Hatzigiannis, stated that these charges are very worrying, especially in the current situation, as they have an impact on inflation. "We are not playing with inflation," he said, calling for restraint. In statements after the meeting, he said that a deadline of two weeks was given for this effort to end somewhere, with the mediation of the Ministry of Transport. The commission is asking companies to freeze the increases, he said, as there is a risk to the economy as a whole.
The General Director of the Ministry of Transport, Communications and Works, Stavros Michael, stated that the contract includes an index, which is present in all contracts, for price adjustment. "What worries us is that the increases will cause inflation to be passed on to consumers." He said that the Ministry reacted from the first moment, calling on all those involved on January 14, appealing to the companies to avoid any burden. In case the companies do not review the increased charges, the Ministry is considering ways to alleviate the problem. In 15 days they will be able to report specific state actions on this problem, he said.
A spokesman for the Ministry of Commerce said it was important to maintain the competitiveness of the economy and export trade. The increases in ports do not contribute to this, he noted and called on companies to show the required restraint.
The General Secretary of CCCI Marios Tsiakkis stated that the port management companies are members of the Chamber and he realizes that they do have an increase in their operating costs. On the other hand, all businesses are faced with increases that must be passed on to consumers. Therefore, an increase of 16%, he considers that should be revised, as part of it concerns imported inflation that is included in the calculation index for the increase of fees. He also noted that the state must relinquish its share of the increased revenue.
For their part, the management companies of the port of Limassol stated that they comply with all the provisions of the concession agreement. They noted that the increases are justified on the basis of the agreements and these arise from the formula that exists in the contracts. They noted that previous years have absorbed the increase in operating costs.
P&O Maritime Logistics, as it was said, proceeded with smaller increases than expected (6-7% instead of 16%). DP World Limassol Ltd said it would be decided by its Board of Directors.
The representative of the Association of Maritime Agents stated that they attended a meeting convened by the Ministry of Transport, in which it was confirmed that the 16,6% increase is correct based on the formula. He noted, however, that the formula is incomplete. The Association, for its part, urges companies to reconsider the increase to be smaller, while noting that ship-owning companies are holding back increases to and from European ports and the ports of the Southeastern Mediterranean.
DISY MP Fotini Tsiridou agreed that the problem really arises from the contracts. However, the issue of the port concession was one of the first, major, reforms that has been made, and it is logical that it will have issues that need to be managed, he said. He noted that based on the concession agreements for the port of Limassol, 63% of the revenues of one container management company and 52% of the revenues of the other company go to the state, resulting in an inflow of € 201,6 million. in state coffers.
He also mentioned that there have been improvements in the service of the public, while the service time of trucks was reduced to 18 minutes. He noted that the government is expected to study the charges and come up with ways to relieve trade from this painful increase.
AKEL MP Costas Costa spoke about a scandalous sale of public wealth. There have already been sharp increases in fees since the day the contracts came into force, he said. He reminded that the Parliament sent a letter to the Attorney General in May 2018 to investigate whether there are criminal or other responsibilities for acts or omissions arising from the report of the Auditor General on the matter. He spoke of the heavy responsibilities of the government with the consumer paying for the broken ones.
Chrysis Pantelidis, Member of Parliament for DIKO, stated that the issue is political. "We find that there are sectors of the market that behave as if they live on another planet," he said, adding that they were hidden behind legal provisions, which were made without anyone imagining the pandemic.
EDEK MP Elias Myrianthous stated that when a state monopoly becomes a private monopoly with the perception that the development in this sector will be stimulated, at the same time the supervisory authorities must be in order to carry out their work. "The Competition Commission had to intervene ex officio" to examine whether the increases are justified, he noted. He added that if the state has revenue in this way, it should compensate if it can not limit the increases.
Source: KYPE