Panama Canal board delays changes to pricing system until July
The Panama Canal Authority's board of directors said Thursday it has published its proposal to restructure the canal’s pricing system and certain regulations.
The authority said Feb. 2 it would devise a canal fee that accurately reflects the commercial value of the service and route. The proposal released Thursday has been slightly modified from the February proposal.
'At the request of the industry, implementation of the new charges has been postponed from May 2007 to July 2007,' ACP said in a statement. 'Due to this modification, the ACP today is reopening the issue for public comment and will consider additional input, suggestions and feedback from interested parties over the next 15 days.
'After receiving comments and feedback from the maritime and shipping industry during its official consultation period, the ACP responded to industry requests by changing the proposal and postponing implementation of the new pricing. Moreover, with this proposal, the ACP is providing its customers with guaranteed pricing to 2009 — something no one else in the industry does.'
The canal authority said it also met with customers and industry representatives at various conferences to listen and receive input, including Intertanko, and the Connecticut Maritime Association. The ACP also met with President Michelle Bachelet of Chile.
“This open and transparent process has given the ACP an opportunity to further understand the needs of the industry,' said Alberto Alem'n Zubieta, administrator/chief executive officer. 'They told us that they wanted the timeframe for implementation extended, and we listened.”
The ACP’s proposal to restructure its pricing system and certain regulations reflects an effort toward charging its customers the market price of the canal’s service today, the authority said.
'As the world becomes more interconnected — barriers dropping, tariffs reduced — the value of the Panama Canal and its role in the global supply chain continues to grow,' ACP said. 'Shippers moving goods from the U.S. Gulf Coast to Asia can save up to 10 voyage days via the Panama Canal, and vessels traveling from the West Coast of South America to the U.S. East Coast shave an estimated eight to 16 voyage days compared to alternative routes. Given the cost increases in shipbuilding, fuel and vessel operations, the route through the Panama Canal has significantly increased its value to its users.'
At the heart of the toll increases, of course, is the canal authority's need to fund its $5 billion expansion plan, where new locks will be built to handle the world's largest containerships. Some carriers have expressed dismay at the prospect of increased tolls to fund canal expansion that could benefit future users who don't even use the canal today.
But canal representative have argued that the toll, while helping to fund the expansion, merely represents the canal's true value to carriers.