A new study has revealed the cost of closing the Port of Auckland following the publication of two economic reports which the Ports of Auckland (POAL) said show that the idea of moving Auckland’s port to Northland is “seriously flawed”.
Closing Auckland’s port will increase the cost of imports by between NZ$533m and NZ$626m a year, found the New Zealand Institute of Economic Research’s (NZIER) new study, which looks at what would happen if Auckland’s port was closed and freight had to be delivered to Auckland from distant ports.
‘Location, location, location – The value of having a port in the neighbourhood’ found multiple negative regional and national impacts such as over $1.2 billion a year in reduced GDP nationally, fewer exports (putting jobs at risk) and less investment.
Ports of Auckland’s CEO, Tony Gibson, said: “Some people claim that closing Auckland’s port would not increase prices, but this is not true. Currently, the price of imports through distant ports like Tauranga is kept low by competition. Think of it as the ‘Gull effect’ for ports. Just as opening a Gull petrol station lowers prices at stations nearby, having a port in Auckland keeps import prices low.”
Last month, Port Strategy reported on NZIER’s and international firm Castalia’s reports, which examined the Economic Analysis of Upper North Island Supply Chain Scenarios carried out by consulting firm EY and produced as part of the second Upper North Island Supply Chain Strategy (UNISCS) Working Group report, which in October recommended the closure of POAL to improve the country’s supply chain. EY’s report was labelled inadequate by the reports.
Carbon emissions increase
Closing Auckland’s port will also increase carbon emissions because freight must travel further by land to reach market in Auckland. CO2 emissions will rise between 121,000t and 212,000t annually.
Mr Gibson added: “I am also very concerned about the increase in carbon emissions that would be caused by using distant ports to handle Auckland’s freight. This does not seem to be in line with the aims of the Zero Carbon Act, nor does it seem wise given the urgent need to tackle climate change.”
