PARTNERSHIP. Public and Private Partnership at the Port of Klaipėda

 

JŪRA MOPE SEA magazine has started the 20th year of its activity.
This Lithuanian maritime publication is the only one with such a long maritime history and is the only one to reach its 20th anniversary, although there were various attempts to create Lithuanian maritime press before. The magazine with a history, dating back to 1935, grew out of the roots of its predecessors, unfolding the first of its branches only thanks to cooperation and sincere partnership with Lithuanian maritime business, port, transport and logistics companies, associations, Klaipėda City Municipality, science representatives and some of the Lithuanian ministries and the diplomatic corps. Later this cooperation has been successfully joined by international organisations and companies.
Thus, celebrating the magazine’s 20th anniversary, we would like to emphasize that it is the celebration of everyone, who has contributed to the creation of the magazine in one way or another.
This year is dedicated to you, our dear friends and honoured partners. We would like to share stories of how you did in the last 20 years and how you are doing now, your plans, goals and challenges of the future.
In this issue we introduce the story of the public and private partnership of Klaipėda State Seaport Authority.

In recent six years Klaipėda State Seaport Authority has invested 215.2 million Euro in the port infrastructure, which belongs to the state. This year cargo handling volumes at the port of Klaipėda have grown by 39.4 % and the revenues of the Seaport Authority before income tax – by 47.2 %.
Each investment project at the port of Klaipėda is implemented according to a strict model – first, Klaipėda State Seaport Authority receives an application from a handling company, operating at the port and using the port’s infrastructure, based on a land lease agreement. In the application the said company indicates the added value that would be created, how this investment would help to attract new cargo flows and what measures will be taken to reach the results, predicted in the application. During the initial stage the applications are assessed by experts of economics and infrastructure at Klaipėda State Seaport Authority, who prepare the investment project payback assessment and implementation plan, and evaluate the financial returns the said project could generate, as well as the benefit it would bring to the port and the state. The decision of making an investment into the state infrastructure at the port, temporarily used by the handling company, is made by a special commission, formed at the Seaport Authority. The commission evaluates each project according to very strict and objective criteria. In addition to that, before the implementation of the investment projects of the Seaport Authority, they are also discussed, evaluated and approved by the Board of Klaipėda State Seaport Authority. If approved by the Board, the Seaport Authority’s strategic action plan and its investment projects then gets green light for four years.
The state seaport of Klaipėda is one of the examples of successful public and private partnership – the state company Klaipėda State Seaport Authority invests into state infrastructure, while private companies that use the land in terms of fixed-term contracts – into suprastructure (e.g. warehouses, lots, handling equipment, machinery, etc.) Based on calculations, 1 Eur, invested by the Seaport Authority into the development of the port infrastructure, brings on average 2 Eur of private sector investments into the port’s suprastructure. The Seaport Authority is very responsible about its investments. According to statistics of the recent six years, it looks like targeted and high-quality investments of the Seaport Authority have contributed to the proportionally increasing handling volumes, which, in turn, increase the port’s revenue and bring larger contributions to the state budget. The Port Authority believes that you can always find money for promising and useful investment projects.
The operation of all companies working at the port is subject to legislation. Newly-formed land plots of the port are leased on the basis of public tender and the Government’s Resolution No. 643 of 02/08/2017 ‘Regarding the Approval of the Description of the Procedure for Granting the Right to Lease Land of Klaipėda State Seaport’ and the Rules for the Calculation of the Lease Rates for the Land of Klaipėda State Seaport, approved by the Order No. 3-671 of the LR Minister of Transport and Communications of 15/11/2010.
Successful implementation of investments at the port of Klaipėda brings direct benefit to the state. According to the study, conducted by Ernst & Young Baltic, 1 Eur of investments from Klaipėda State Seaport Authority brings 3.65 Eur of income to the public sector. It was also calculated that the investments into the port infrastructure, made by the Seaport Authority, pay off on average in 3 years and 3 months. However, there are some exceptions too, when the investments pay off in 1 or 2 years.
Talking about the port’s specifics, it should be noted that the revenue of the Seaport Authority is used not only for investments, but also to ensure the port’s functions, e.g. the activity of the captain, pilots, maintaining the port’s depth, port security, infrastructure maintenance, development plans, etc. The Seaport Authority also pays dividends to the state. E.g. Last year the Seaport Authority supplemented the state budget with 22.3 million Eur dividends for 2017.
The port’s rational investments and effective activity is illustrated by statistics. In the period of recent six years, the Seaport Authority has increased its assets by 16 % (from 505.6 million to 588.8 million Eur), the port’s handling volumes have increased by 39.4 % (from 33.4 million to 46.6 million tonnes), the profit (before the income tax) – by 47 % (from 23.6 million to 34.7 million Eur).

 

The magazine SEA has been published since 1935
International business magazine JŪRA MOPE SEA has been published since 1999
The first magazine in Eurasia in the four languages: English, Chinese, Russian and Lithuanian


Address:

International business magazine JŪRA MOPE SEA
Minijos str. 93, LT-93234 Klaipeda, Lithuania
Phone/Fax: +370 46 365753
E-mail: news@jura.lt
www.jura.lt

 


Publisher:

Ltd. Juru informacijos centras


The magazine JŪRA has been published since 1935.
International business magazine JŪRA MOPE SEA has been
published since 1999.

ISSN 1392-7825

2017 © www.jura.lt