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Julian Manduca
Importers contacting our sister paper, The Malta Financial and Business Times, this week said they were still facing major obstacles because of the dominance of the CMA, China Shipping and IRISL lines at the Freeport. Several importers have not managed to bring containers of food and other products to Malta because of the changed environment in the shipping world and because certain regular lines no longer operate to Malta. The importers said in some instances they have goods that have been waiting for more than a month and despite efforts have not been able to find a slot for the containers to reach Malta.
Some of the shipping lines previously used by importers no longer operate to Malta and the importers have not managed to find alternative services from their ports of departure.
The GRTU director general, Vince Farrugia, told this newspaper last week that there was a gulf between the angst importers were facing and the government’s willingness to tackle the problems, but several government officials are now reacting.
Parliamentary Secretary for Competitiveness Edwin Vassallo this week took the bull by the horns and organised a meeting for those affected at Casa Leone, St Joseph Street St Venera, while Minister Austin Gatt also met representatives from the FOI.
Vassallo told our sister paper this week that he “has always helped and managed to solve the problems of those businesses that approached him,” but complained that some people grumbled but failed to contact his ministry.
“The more I know about the business problems, the better, what I don’t know about will always be more difficult to solve,” Vassallo said.
Minister Austin Gatt
The minister responsible for The Freeport, Austin Gatt is aware of the situation and said his ministry “is discussing with the Freeport the possibility of holding a series of workshops that will involve all interested parties so that solutions are identified and agreed.”
Gatt explained what he felt was the source of the problems: “The EPIC service which had been operating in Malta for a number of months was not contracted at the Freeport but called in Malta on a non-commitment basis. “The Freeport had already received clear signals that it was EPIC’s intention to shift the service out of Malta, especially when one considers that one of the members of the EPIC consortium has a shareholding in a competing port in the Mediterranean. In the meantime, the Freeport signed a new contract with IRISL and increased the business with China Shipping.
“It is appreciated that every change in the Freeport's client portfolio may force Malta’s industries to seek alternative logistical solutions.
Gatt believes The Freeport are not the cause of the problem: “The Freeport has little or no control at all over the choice or frequency of port coverage by shipping lines who are ultimately their clients” – but is pleased with its performance recently.
“The Freeport has, over the years, managed to win clients from competing ports, but there were others who shifted their operations elsewhere. Overall, the port has increased the traffic volumes it handles over the years, reaching a record of 1.3 million containers in 2003. The Freeport is presently nearing its full capacity and it requires continuous investment to expand its capabilities. This is one of the reasons the Government decided to privatise the Freeport.”
Minister Gatt is not pessimistic about the future of the of the Freeport: “Services from the Freeport over the last years have increased and today local importers and exporters can reach over 100 ports worldwide on a weekly basis.
“These connections are available to industry thanks to the transhipment services operating in Malta and not because of any other strategic reason. It should also be highlighted that the handling of domestic cargo is now benefiting from the Service Level Agreement which Freeport has committed itself to and which will form the basis of service levels in the future.”
FOI’s Edwin Calleja
The Malta Financial and Business Times also spoke to the Federation of Industries’ Director General Edwin Calleja who said: “The situation at the Freeport has visibly deteriorated for both importing and exporting of merchandise. Malta’s industry has to import its supplies of raw materials and components before exporting its merchandise.
“So it is being hit on both counts. The Freeport’s core business is transhipment and its efforts are mainly dedicated to this type of activity. Moreover, local imports and exports represent a very small percentage of the port's business.
Calleja indicated how the increase in volume at the Freeport is a double edged sword: “Thanks to the increase in transhipment at the Freeport, Malta's industry has for a number of years been enjoying the consequential benefits of having a number of shipping lines that were serving several ports throughout the world and that stopped at Malta for transhipping purposes. “This worked to industry’s advantage because enterprises have managed to find cargo space on the container ships coming to Malta and sailing to a number of destinations previously not even dreamt of. “In recent months, however, Freeport Corporation has been giving priority to two particular shipping lines who are its major clients. These seem to be very insensitive to the particular needs of Malta and are hardly bothering to provide any service to Malta's industry.
“On the other hand there were other shipping lines that formerly had ships calling regularly at Malta Freeport who are now no longer doing so because of delays to allocate to them ‘slots’ and to guarantee prompt loading and unloading of cargo.
“The reduction in the number of shipping lines using Malta Freeport has definitely created problems to local industry and the Federation has had a number of complaints in recent months from enterprises that were either receiving their imports late or having delays in their export shipments, or finding difficulty to send shipments direct to their customers and without the loss of time that is associated with transhipment.”
Freeport Chairman Mark Portelli
Freeport chairman Mark Portelli said he was aware of the problem some importers and exporters are facing but believes the problems can be solved. “Due to some changes of our client base a new situation is developing, but while some opportunities are no longer available, other doors have been opened.”
Portelli said it was only a matter of time before the importers got used to the new situation and either found alternative lines or operated with the larger shipping lines that covered most ports. “There may be some problems because the importers were used to certain lines and now find it difficult to change, but I do not think these are insurmountable problems.”
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