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06.06.2019 Business & Finance

MPS Terminal 3 UpTariffs By 20%

By Staff Writer
MPS Terminal 3 Adjusts Tariffs By 20%MPS Terminal 3 Adjusts Tariffs By 20%

A letter signed by Sunil Bansal, Chief Financial Officer of Meridian Port Services, addressed to Michael Luguje, Director General of the GPHA, dated 24th May, has adjusted tariffs at its Terminal 3 by 20 percent.

It said the tariff for Terminal 3 has been drawn in line with the provisions of the deed of amendment No.1 dated 12th June, 2015.

“The tariffs reflected in the attached sheet are adjusted by 20 percent as per the provisions of the agreement. “We would also like to bring to your attention that the actual payment by the customer will be done as per the clause 1.2 of the schedule 5 of the original concession agreement as reproduced hereunder.”

It further specified that “Every ship or vessel which berths in the concessionaires' area shall pay in US dollars or equivalent convertible currency to the concessionaire the appropriate dues, rates and charge as specified in said schedules. Every shipper or consignee which uses the concessionaires services shall pay in US dollar or equivalent convertible currency to the concessionaire the appropriate dues, rate and charge as specified in the said schedule. Every ship or vessel or shipper or consignee which does not earn foreign exchange which berths or uses concessionaires' services shall pay to the concessionaire the cedi equivalent of the appropriate dues, rates or charge as specified in said schedules.”

“Considering our Terminal Go Live plan of 28th June, 2019, we hereby request you to publish the tariff at your earliest.”

Meanwhile, an analysis of the impacts of the deed of amendment to the MPS concession agreement for the management of Terminal 3, which goes into effect in July this year, has projected a bleak future for the GPHA.

Based on highlights of the impact of MPS 3 Contract Terms on GPHA, and using the 2017 cargo/vessel traffic data, it said the volume of containers handled by GPHA and other licensed container handling companies would decline by at least 60 per cent.

It said the labour and cargo handling equipment would thus be rendered idle.

Furthermore, it said revenue presently being earned by GPHA will decline. First of all, it said container stevedoring revenue will decline from $10.688 million to USD4.21 (-60.54%) while also container shore handling revenue will decline from $38.75 million to $17 million (-56% decline).

Furthermore, it said royalties revenue on MPS operations will decline from $24.12 million to $6.57 million (-73.67% decline); terminal area rent revenue from MPS terminal will decline from $826,000 to nil (-100%/zero); berth occupancy revenue from MPS terminal will decline from $1.915 million to nil (-100% /zero); port dues revenue on MPS container operations will decline from $29 million to 2.9 million (-90% decline); entry ticket/goodwill – one-off entry ticket which should be at least 5% of project cost would be lost, whereas in the MPS 2 concession agreement, $5million was paid as goodwill.

It warned that if the agreement was implemented unchanged, GPHA will among other things be in financial crisis in 2020, will have idle labour, space and equipment; will not generate enough revenue to pay salaries, service existing loans, to develop basic statutory port infrastructure.

The Inter-ministerial Committee which investigated the Concession Agreement for the MPS Terminal 3 also concluded that the agreement conceded too much business and revenue to MPS to the detriment of GPHA and Government of Ghana as a whole. The Committee therefore strongly recommended that the Agreement should be renegotiated.

---Daily Guide

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