“Something to reflect on…”

In its purest form it has entailed whole port privatisation and then scaling down from this the full corporatisation of port management (which can be defi ned as the ability to act without reference to government other than in conjunction with statutory requirements) and below this semi-corporatisation where there is still referral to government on key issues such as port pricing.

Experience tells us that autonomy has brought many tangible benefits to the international ports sector, not the least of which is private sector funding through the implementation of Public Private Partnership (PPP) schemes usually in conjunction with terminal assets.

A less tangible benefit but an equally important one is the management culture that comes with being master of your own destiny. There is nothing like standing on your own two feet to develop a more proactive and responsible culture to getting things done in the right way.

It is a salutary lesson to reflect on this when looking at PS’s front cover this month, highlighting the devastating impact of the explosion of 2750 tonnes of ammonium nitrate – a highly combustible material used to make fertiliser and bombs – that was stored at Beirut Port in unsuitable climatic conditions, with no expert oversight, for more than six years.

It arrived in the port by default, as a result of a vessel detention and there followed what is now an almost unbelievable chain of toing and froing between Lebanese government officials as to what to do with this inherently dangerous cargo but without any resolution as to who should take responsibility for selling or destroying it. In the end this dithering proved fatal with the ultimate cost estimated at over 200 dead, many more people missing and thousands injured!

It is reasonable to suggest that under a more autonomous port regime that that such a chain of events would never have been allowed to happen. In effect, it is the lack of a clear line of responsibility and the general malaise that goes with this that has undoubtedly contributed to this catastrophic situation. Under a more commercial culture, there would be clearer lines of responsibility, stronger accountability, powers of action and better decision making.

In a more general sense, this is something to reflect on for ports under public ownership and operation – typically, for example, when considering making the transition from a semi-corporatized management body to full corporatization or evaluating whether to operate terminals under PPP arrangements.

You have to have vision to look beyond your experience to-date and to properly evaluate the benefits of taking a more autonomous route. Prevailing government politics should not come into the equation (socialist regimes who have guaranteed no job losses for example) or a general resistance to change for reasons of self or collective preservation.

Real management is about looking beyond these self-imposed limiting factors and taking the best path to realise tangible benefits – cost effective port and terminal operation, safe operations and all those good things that have seen enlightened port management move on a huge scale to adopt a more private sector led management culture.

There are numerous success stories that underpin these assumptions just as there are instances of costly mistakes by those that have not participated, Beirut being a prime example.