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Exchange ratesmore »
Ecuador: Banana producers request authorities review the concession in Puerto Bolivar
Banana producers and exporters from Machala (El Oro), Ecuador, called for the review, restructuring or cancellation of the public-private alliance underpinned by the concession of the Puerto Bolívar Port Authority, as its costs in expansion and modernization, they say, "are being and will be entirely financed by the banana sector."
Eduardo Ledesma, the executive director of the Ecuadorian Banana Exporters Association (AEBE), warned about the detrimental effects on the production chain that the application of the new banana export tariff scheme, which increased costs from $0.13 to $0.20 dollars in May and that for September would reach US $ 0.27.
Ledesma and Jorge Alex Serrano, the president of the AEBE board, which is responsible for 70% of the banana exports from the Banana Marketing and Exports Association (Acorbanec) in Puerto Bolivar, participated in a meeting promoted by the mayor of Machala, Carlos Falquez to discuss this issue.
According to analyses made by economists, the implemented tariffs include increases that would serve to finance the expenses derived from dredging, dock construction and equipment, which are the responsibility of the concessionaire of Puerto Bolivar, which will have the port for 50 year, plus 10 years of amortization.
"The only user of the port will be the banana sector, which accounts for 95% of the port's income against 5% of imports," Ledesma said. He said the guilds were not against the concession, modernization or investments in the port, but that they were against the study of the rates drawn up by those who made those projections.
The union official stressed that "all the burden will fall on the banana sector and the bulk cargo, of which El Oro generates 85 to 90% through Puerto Bolivar, leaving very little for the containerized cargo," he said, adding that the Government "must get a grip of this concession because a public-private alliance can not be written in stone."
The union members insisted that the current regime needed to boost the productive activity to avoid a loss in competitiveness that would lead to a decline in foreign exchange earnings and a loss of employment that is very important to develop a new Ecuador.
They also said the Ministry of Transport and Public Works through the Undersecretariat of Maritime and Fluvial Transport needed to review the studies carried out by the Port Authority regarding the tariff because the concessionaire was determined on taxing them for what the concession contract established they had to do and, apart of demanding full payments, the concessionaire insists that the cargo be loaded with their cranes, impeding the use of the ships' cranes.
The mayor, in his capacity as president of the Cantonal Assembly, said that he would insist that the proposals of the parties affected be taken into consideration by the president of Ecuador, Lenin Moreno.
In turn, Yilport said that the rates being implemented before they were the concessionaire of the port, "were a kind of subsidy that only benefited the Freight Operator directly and banana exporters (brokers) indirectly." They also said that the company was only equating the costs of the tariff, which according to Resolution No. 20-2017, of May 8, are set to for May and June at US $ 0.20, but that that increase had still not been enforced.
Publication date: 7/13/2017
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