Gad Schaefer: more time needed to study port tariff reforms

Tariff reform will create substantial costs changes to both the importing and exporting communities hence more time is needed to carry out an in-depth study of the suggestions
 
Following the release of the long awaited ports' tariff reforms, the Israeli Shippers Council issued a press release indicating that more time is needed for a thorough study of the overall implications of the government ports' tariff reforms.
 
Mr. Gad Schaefer Chairman, Israeli Shipper's noted that the tariff reform will create substantial costs changes to both the importing and exporting communities hence more time is needed to carry out an in-depth study of the suggestions.
 
The government proposal was forwarded to the local shipping companies, freight forwarders and representative bodies of local importers and exporters.
 
The main points of the proposal are:
1.         An end to cross-subsidization of imports and exports and a reduction on fuel import fees. The biggest losers will probably be the exporters who today enjoy relatively cheap port services.
2.         Cargo owners (importers and exporters) will pay port infrastructure service charges directly to Israel Ports Development & Assets Company Ltd.
3.            Wharfage fees on imported goods will no longer be based on the C.I.F value of the cargo regardless of the costs of handling. Instead, they will be based on actual costs involved, plus development and infrastructure fees - which will be the same for bothimporters and exporters. (The wharfage fee, which currently account for 50% of port revenues - NIS 1.1 billion a year. For years these fees were calculated at 1.02% of the C.I.F value of the imported goods, regardless of actual handling costs. It was highly discriminatory against imports, while favoring exports (0.2% of the FOB value).
4.         In 2009 wharfage fees will be calculated on 0.45% of a cargo's value for imports and 0% for exports. 
These figures, according to the proposal, will be gradually decreased and increased, respectively, over a 10-year period until reaching a proposed fixed rate per container equal to 0.15% of the average cargo value in 2006.
5.         An incentive by way of a fixed discount to port customers willing to switch their activity to nighttime hours. A discount of up to NIS 80 on infrastructure fees will be granted to containers brought in between 10:00 P.M. and 5:30 A.M.; containers brought to the port during the regular working hours will incur a NIS 20 premium. The aim is to increase efficiency and road safety by encouraging night-time port use.