Government seeks US$200m in port public-private partnership

THE government could attract some US$200 million in private-sector investment to improve cargo handling at the Port of Port of Spain, said speakers at the launch of the Port of Port-of-Spain public-private partnership (PPP) structuring process on Monday via Zoom.

Port Authority chairman Lyle Alexander said a readiness assessment had suggested "a high potential of delivery in what we estimate to be a possible $200 million in investment in this project."

He expected the project would increase the port's efficiency and productivity. Alexander said the authority looked forward to a transparent tender process to select an investor.

IDB Caribbean regional manager Tariq Ali said, "This project is a game changer for TT's economy and society.

"We present a public-private partnership with the potential to mobilise US$200 million in direct investment from the private sector."

He said the IDB often assisted in attracting investments to projects which were "efficient, sustainable and bankable," and in strengthening regional PPP regulatory frameworks.

Minister of Public Administration Allyson West said a recent global survey on the ease of doing business had ranked TT at a lowly position of 134 out of 190 countries for trading across borders. She said a Cabinet committee had concluded that enhanced port operations would require private capital.

West said the goals for the port were for it not to be a drain on the economy, not to hinder trading, but to facilitate the efficient movement of goods into and out of TT.

Planning Minister Pennelope Beckles said PPPs brought to the public sector more participation by the private sector which brought its knowledge, financial capacity and efficiency.

She said the region needed US$21 billion invested in its infrastructure for 2014-2025, according to the World Bank and Caribbean Development Bank.

"The American Association of Port Authorities stated that cargo activities at US ports accounted for 26 per cent of the US economy, generating nearly US$5.4 trillion in total economic activity and US$378 billion in federal, state and local taxes – a figure which is expected to increase significantly through to 2030."

With its closeness to the US and facilities such as the Panama Canal, the Caribbean was expected to play an increasing role in global logistics, Beckles said.

The IDB's Gastón Astesiano said each $1 invested in infrastructure brought a $2 return in extra GDP, even as the Latin America/Caribbean (LAC) region needed US$250 billion per annum to close the infrastructure gap. The IDB's Ancor Suárez Alemán said most big ports in the region were run as PPPs. These have experienced remarkable increases in efficiency in their cargo management as PPP, averaging 20 per cent, he said.

Suárez Alemán noted that in the LAC region it takes thrice as long to process a container as in Singapore.

IDB country manager Carina Cockburn said the project aimed to increase the port's efficiency and generate new revenue streams, and was an important project for TT's future. She expected tendering for the PPP in early 2023, and said the IDB was committed to supporting the government to make the project a reality.

Minister of Works and Transport Rohan Sinanan listed the port's challenges as low productivity, obsolete infrastructure, and the need for public subsidies to pay operational costs.

"Since 2014 the port throughput has been steadily decreasing. Turnaround time and containerised movement rates have declined, while port equipment such as cranes are not transferring as many containers as targeted.

"In this regard the ministry looks forward to this RFP (request for proposals) attracting significant interest, resulting in a concession agreement that will benefit TT, the private partner, and the port."