||Asean Affairs 17 June 2013
Ports to be corporatised before 2015
BANDAR SERI BEGAWAN
Brunei:THE corporatisation of the Ports Department is likely to be implemented before the 2015 target set for the Postal Services Department, the minister of Communications said recently.
Yang Berhormat Pehin Orang Kaya Hamzah Pahlawan Dato Seri Setia Hj Abdullah Begawan Mudim Dato Paduka Hj Bakar on the sidelines of the opening of a post office branch at The Mall in Gadong last Thursday said that the Postal Services Department was expected to move towards corporatisation in two years' time.
Asked when Muara Port would be corporatised, the minister said: "Hopefully sooner than the (Postal Services). If it is (done) the same time, better, but we are more advanced in the Ports Department than Post."
He said the ministry is currently looking into how the departments will operate as a corporate entity.
"We are having a study and are going to look into the methodology. As you know, we will also be corporatising the Ports. So, at the same time we are looking at parallel methods. We hope within two years, we do corporatisation first, then privatisation," YB Pehin Dato Hj Abdullah said.
Corporatisation would convert a state-owned entity into an independent company that is still majority-owned by government. It is sometimes a precursor to privatisation, during which the government transfers ownership of the businesses to a privately-owned entity.
According to a previous report, the Ports Department would look at lowering operational costs and review port charges when it becomes a corporate entity.
"Once it (the Ports Department) has become a commercial entity, profitability will be a main focus. We can bring prices down, but we need to make a profit too. So, this must be done by lowering operational costs and improving efficiency and productivity," Pg Hj Mohd Zain bin Pg Hj Abd Razak, the acting director, said in an interview published in the Oxford Business Group's (OBG) 2013 country report for Brunei.
He said that as in other successful ports across the region, Muara Port has its own IT system.
"Implementing new technology and infrastructure we enable the department to focus on improving its services and ultimately allow it to compete with these regional ports."
Pg Hj Mohd Zain said that the department was also in the process of embarking on a study to develop a Muara Port masterplan.
"This will involve ascertaining the structural integrity of the conventional terminal, accommodating future requirement for cruise ships, re-positioning and re-evaluating the functions of warehouses, the development of other value-added services and the development of logistics centre to facilitate trans-shipment activities," he said.
Meanwhile, reviewing the current charges was necessary, as "it has been acknowledged" that Muara Port has among the highest fees in the region, he said.
Pg Hj Mohd Zain said that a review of existing charges needed to be made in order to be more competitive with other similar-sized ports while continuing to improve operational efficiency to attract more shipping lines.
"Port charges, to some extent, are within our remit and we should be adequately responsive to market changes," he explained.
He added, however, that any changes made to the fees need to be sustainable.
"It is obviously important to think about long-term sustainability. Lowering charges would trigger our competitors to react and could result in undesirable price war. I would say this is not a sustainable practice for commercial ports."
The Brunei Times