Caribbean shipping charges some of the highest in the world

BRIDGETOWN, Barbados, Thursday, March 22, 2012 – The cost of shipping and port charges in the Caribbean is some 30 per cent higher than the world average.

This sobering statistic was revealed recently in a new paper by the Waterloo, Canada-based Centre for International Governance Innovation (CIGI).

And the Canadian think-tank is advocating that the Caribbean maritime infrastructure “needs to undergo a major physical, legislative and labour practices overhaul” in order to be sustainable and efficient.
In the paper entitled The Caribbean Maritime Transportation Sector: Achieving Sustainability through Efficiency, Fritz Pinnock and Ibrahim Ajagunna say, “it is not surprising that handling charges are two or three times higher than in similar ports in other regions of the world, and the overall cost of transportation and infrastructure in the Caribbean basin is some 30 percent higher than the world average.”

The efficiency of these ports, caused by fragmented approaches to developing them, has serious economic consequences because 90 percent of imports and exports are carried by sea.

Pinnock, who is the executive director at the Caribbean Maritime Institute, and Ajagunna, who is the immediate past president of the Council of Heads of Caribbean Hospitality Schools in Jamaica, used primary and secondary research to analyze labour challenges and efforts of regional cooperation among other port-related indicators of efficiency.

“The region has not capitalized on the opportunities to use maritime transportation as a development tool,” the reports states. “Advancements in technology and skills have today placed the Caribbean in catch-up mode, as most reforms have been cosmetic, and do not address the real need to overhaul the entire infrastructure and take a holistic approach to positioning the Caribbean within the global logistics and supply chain.”

The paper makes nine policy recommendations for the Caribbean including suggesting that the region re-think whether the transhipment business is right for them at all considering the risks and benefits. The paper also suggests that some of the nations that are not doing so already implement a landlord model to improve port efficiency. Moreover, the researchers recommend that an integrated regional approach is taken to safety and security regulations and monitoring; conducting collective economic, social and environmental impact studies to guide investment and development; and pursuing cooperation in data and research access between sub-regional organizations, institutions and member governments.

Included in the recommendations are also that the region adopt an integrated assessment approach to strategic decision making; align labour market regulations to global standards; harmonize maritime transport industry legislation; and ensure maximization of public benefit through public expenditures. Click here to receive free news bulletins via email from Caribbean360. (View sample)