Solomons crisis looms as port reforms stifle business

Transcript

The prime minister of Solomon Islands has promised action to avert a looming economic crisis fuelled by increased fees and longer processing times at the country's international ports.

The Solomon Islands Chamber of Commerce says the ports claim to have raised fees by 254 percent.

But its chief executive Greg Terrill says this translates to an 1100 percent increase for some of his members.

He spoke with Koroi Hawkins about the situation.

GREG TERRILL: I think generally people very strongly support reform, recognise that as part of that it could be that tariffs have to go up. But the trade-off is that service should go up and efficiency improve.

KOROI HAWKINS: By how much have they increased?

GT: It depends on who you ask. The full tariffs are not published publicly so it's hard to tell. The CEO of the Ports authority has said 254%. Other importers - and it depends exactly what you import and how you use the ports - report up to 1100%. Now this increases all predates their data to last October. And there have been certain changes since then, so it's probably higher than that, but it gives you an idea of the rate.

KH: And how do you measure the services declining?

GT: So there are some fairly standard measures of productivity of ports. How long it takes to get [cargo] off a ship. How long a ship has got to sit in the port. How long it takes a business to access the port and get their container out so they can take it away and put it in their shop or business. But the delays are more than that. It's not just how long does it take to get your container and how long it takes to get your container off the ship and to the business. It's actually that, in some cases, or in one case, the shipping line has decided to stop coming to Honiara. In other cases, shipping lines have changed the way that they do come here.

KH: And I assume that that also passes on inflated prices on goods and services to the public since most of the stuff is imported into Solomon Islands?

GT: Look, you're right. And there are notices starting to appear in shop windows at the moment, apologies customers due to delays at the ports and increases we won;t be having the sales that we traditionally have, or we don't have the goods that we have expected to carry. If you've got a car at a repair shop, for example, parts are not coming in on time, so the cars are sitting in the repair yard, or if there are companies trying to lay for example sort of concrete or build houses or buildings or whatever, they're not able to do that because of access to the goods.

KH: Now, two major companies - Guadalcanal Palm Oil Limited and the National Fisheries Development - have gone and spoken with the prime minister and he said in a press statement that he was going to address this situation. Has that come about? This was about a couple of weeks ago, I understand.

GT: Yeah so in the paper two weeks ago, the big announcement, those companies facing... well GPOL was facing some very serious, I think they're both facing very serious issues, and they're two of the three main export industries in Solomon Islands. So it's very serious for the country. The prime minister, I believe, has been very active indeed, trying to work with his colleagues and gain agreement about a solution to the problem. I'm obviously not able to comment on the political process in any detail whatsoever except to note that that's still underway, and the solution is yet to come out from that.