Maritime reforms

EDITORIAL: Week after week now the maritime sector has made its case for reforms, arguing how a turnaround would benefit the entire economy, yet it’s as if its pleas are falling on deaf ears in Islamabad.

Once more, the Seatrade Group of Companies has pointed out that something as basic as compliance with internationally recognised certifications would unlock the sector’s “immense potential” and benefit traders, importers and exporters alike, but for some reason it has not crossed authorities’ minds so far.

All sorts of stakeholders are complaining that Pakistan’s ports have become “unbearable”. All dredgers, despite their costs, are “out of order due to mismanagement and corruption in the tendering process”, making the exercise “prohibitively expensive”. Calls for basic reforms like reducing dock labour wages to industry levels, streamlining staff at Port Qasim Authority (PQA) and Karachi Port Trust (KPT) and directing revenue towards improvement in port facilities instead of “unnecessary expenses” have gone unanswered.

Acquiring and complying with international certifications would go a long way towards solving some of these problems because it would force authorities to ensure that maritime activities meet the highest international standards.

But the opposite seems to be happening. Instead of ensuring compliance and making the maritime business more competitive, and therefore more profitable, some ministries have been dismantling the few mechanisms that were put in place to ensure some sort of collaboration between public and private sectors.

The National Trade and Transport Facilitation Committee (NTTFC), for example, was one such body that was “highly effective in facilitating trade”, in the words of Abdul Rasheed Janmohammed, president of the Bin Qasim Association of Trade and Industry (BQATI). But the commerce ministry suddenly pulled the plug on it, without warning or an explanation, “depriving the business community of essential sea trade”.

It turns out that this – along with many others – was not just a bad business decision that hurt trade, which is ironic since the commerce ministry exists to promote commerce, but it also triggered deeper macroeconomic imbalances by putting downward pressure on employment and consumption statistics.

The blue economy, which concerns everything related to the maritime sector, has deep linkages in the larger chain that holds the real economy together, that is why countries blessed with natural ports go out of their way to protect and encourage sea trade.

But not this one. We remain a country with no less than three ports that cannot live up to their potential only because of the government’s own policies, or lack thereof. Therefore, the ministries of finance, maritime affairs and shipping and ports have a lot of questions to answer. Why have these issues gone unaddressed so long? Why have we deliberately reduced our natural competitive advantage in such a crucial sector?

We are repeatedly told that these are times of a historic transformation in the economy. The brush with default has finally highlighted the urgency and inevitability of reforms. We will have to expand our revenue base, one way or the other, because the borrow-to-survive cycle has run its course. But the low priority accorded to the maritime sector makes one wonder if the government is really sniffing around for sectors where reforms would yield high returns.

Now that the maritime sector has done what it could to put its concerns across, it can only be hoped that things will start moving in the right direction in relevant ministries.

All politicians have done to the state’s assets, and its enterprises, so far is hardly worth writing home about. This time they said they understood the gravity of the fiscal emergency and promised to do whatever it took to turn the economy around. Reforming the maritime sector is one such opportunity. And they are still letting it go waste.

Copyright Business Recorder, 2024