Maersk concerns on port merger hard to take seriously

The Mar­itime Union has dis­missed com­ments by glob­al ship­ping line Maer­sk about the merg­er of Port of Lyt­tel­ton and Port of Ota­go.

The two ports announced a planned merg­er of oper­a­tions yes­ter­day, sub­ject to approval by the Cham­ber of Com­merce.

Maer­sk New Zealand man­ag­ing direc­tor Julian Bevis was report­ed today as say­ing he had con­cerns about the “dom­i­nance” of the new port struc­ture and how this would affect prices, ser­vices and mar­ket com­pe­ti­tion.

Mr Fleet­wood says it is hard to take such con­cerns with a straight face.

“Maer­sk is a mas­sive oper­a­tion, the world’s largest ship­ping and con­tain­er ter­mi­nal con­glom­er­ate, and they must real­ly be short of things to wor­ry about if this is all they can come up with.”

He says that Maer­sk’s ongo­ing glob­al growth through merg­ers and acqui­si­tions indi­cat­ed that they had no con­cerns with any effect on com­pe­ti­tion by their own oper­a­tions.

Mr Fleet­wood says the goal of any cap­i­tal­ist cor­po­rate like Maer­sk was to dom­i­nate the mar­ket and reduce their risk and expo­sure to com­pe­ti­tion.

“Let’s face it, the real­i­ty is that they are the ones dom­i­nat­ing the mar­ket and threat­en­ing com­pe­ti­tion, not two ports in the South Island of New Zealand.”

Mr Fleet­wood says the prob­lem with New Zealand ports was the exact oppo­site of Mr Bevis’ claims.

“New Zealand ports have long been played off against each oth­er by pow­er­ful ship­ping com­pa­nies, and even large local cor­po­rates such as Fonter­ra.”

This has result­ed in seri­ous dis­rup­tion to region­al ports, which had many neg­a­tive impli­ca­tions for New Zealand’s econ­o­my and social sta­bil­i­ty.

Mr Fleet­wood says the Mar­itime Union was cau­tious­ly opti­mistic about the merg­er between Port of Lyt­tel­ton and Port of Ota­go.

“Obvi­ous­ly it is ear­ly days, but ports work­ing togeth­er like this could have ben­e­fits, as long as it does not lead to any region­al ports being under­mined.”

He says the Union would like to see ports remain under pub­lic own­er­ship, but also come under some form of nation­al co-ordi­na­tion, a con­cept which the Union calls “Kiwiport.”

“Ports are not just anoth­er busi­ness, they are key infra­struc­ture, and the gate­way for New Zealand exports and imports. They need to be oper­at­ed in the nation­al inter­est.”

The Mar­itime Union had been active in the Keep Our Port Pub­lic cam­paign in 2006 dur­ing an unsuc­cess­ful attempt to part-pri­va­tize Port of Lyt­tel­ton through a deal with glob­al ter­mi­nal oper­a­tor Hutchi­son.