The American Chamber of Commerce in Ukraine (ACC) has called for reduction of the rates of port charges in Ukraine.
According to the ACC, it has been cooperating with the Ministry of Infrastructure, the Ukrainian Sea Ports Authority, and other state authorities for many years to help attract foreign direct investment to this sector.
“The economic attractiveness of seaports and stevedoring companies largely depends on the size of port dues. A strategic aspect of how to further develop Ukraine's maritime industry is to ensure its competitiveness and to fulfill the potential of transit sea cargo. The interests of business and the entire port industry should be taken into account during establishment of the rates of port charges," the American Chamber of Commerce said.
The American Chamber Of Commerce in Ukraine cited a study by VoxUkraine, an independent analytical platform with the support of World Bank experts, which states that a 50% discount on port dues generates losses of USD 48.4 million. “At the same time, it provides additional tax revenues of USD 167.7 million. This is generated from increasing the profitability of businesses that receive such a discount and contributes to the development of the regional economy.”
“The American Chamber of Commerce in Ukraine has emphasized and continues to support the policy on reducing port dues. This policy will have a positive impact on Ukraine's economy, which will lead to an increase in export cargo flows and boost Ukraine's GDP. The reduction of port tariffs and fees by Ukraine's Government in 2018 helped to develop the ports industry and boost economic growth," the chamber said.
As the CFTS reported, the National Anti-Corruption Bureau and the Special Anti-Corruption Prosecutor’s Office have served former minister of infrastructure Volodymyr Omelian with notification of suspicion of causing a loss of UAH 30.5 million in state budget revenues by taking action to reduce port charges in 2018,.
According to investigators, Omelian ordered reduction of all port charges (except lighthouse charges) by 20% in December 2017. However, one of these port charges is a source of revenue into the state budget, which only the parliament is authorized to change.
The European Business Association (EBA) reacted to the actions of the National Anti-Corruption Bureau and the Special Anti-Corruption Prosecutor’s Office by saying that "positive achievements of the past should not be a reason for prosecution."
“Several years ago, the decision to reduce port fees was supported by business, and further work in this direction is welcome. At the same time, the current situation with this issue looks strange. After all, we as a country are moving towards high-quality and constructive reforms that create favorable conditions for doing business, working, attracting investment. However, if the change agents are being prosecuted and punished for their initiative and decisions, the question arises - whether others will be ready to take responsibility and initiate quality changes to implement real reforms in the country. I think it is worth thinking about because I really want to believe that our goal is the same - to build a strong and competitive country,” the European Business Association’s Executive Director Hanna Derevianko said.
According to the European Business Association, reduction of port charges at Ukrainian seaports has always been an issue that businesses have raised in dialogue with public authorities, particularly the Ukrainian Ministry of Infrastructure.
The association believes that the rates of port charges in Ukraine are not competitive compared to other countries. Therefore, according to the association, businesses has always advocated for their reduction to economically justified levels. The association considers the accusations against the former minister on this issue unfounded.