We have been told over and over again that Malta Freeport is a success story. The Fenech Adami administration always refers to it in a positive way. Malta Freeport is praised for its "growth process", "its comprehensive range of activities... that have enabled it to record significant results and distinguish itself from its competitors."
We are told that "In its short lifespan, the Freeport is presently handling over one million TEUs (containers) per annum, the threshold required for entering the exclusive port league and is ranking third among the leading transhipment ports in the Mediterranean..."
Prime Minister Fenech Adami has been so impressed with the achievements of the Malta Freeport that he wants a monument built to celebrate the outstanding successes of its chairman, Marin Hili. Dr Fenech Adami has defended Marin Hili in his conflict of interest situation by hanging on to his public post as chairman of Malta Freeport while privately acquiring half of the company running Terminal Intermodale Venezia.
How is Malta Freeport's "success" defined? Why should the chairmanship of Marin Hili be celebrated? The Fenech Adami administration and Mr Hili himself always stick to the number of containers handled when they talk about their fabulous success story. They never talk about Malta Freeport's success in financial terms. Why? The answer is very simple: Malta Freeport is a monumental loss-maker.
Overtaken by Gioia Tauro
Even the number of containers handled by Malta Freeport has to be put in perspective. Government boasts that "in its short lifespan, the Freeport is presently handling over one million TEUs per annum..." Malta Freeport was set up in 1990 and after 11 years attained a turnover of 1.2 million containers. Gioia Tauro in nearby Italy got into gear to handle transhipment traffic from 1995 and within six years overtook Freeport by reaching 2.5 million containers. By this yardstick alone, Mr Hili has performed very poorly in the area that he has continually boasted about - the turnover of containers.
In the July edition of Top 100 Container Ports in the world Gioia Tauro is placed 20th with 2.5 million container turnover for last year, whereas Malta Freeport is in the 55th post with 1.2 million containers. It remains to be seen whether this year Malta Freeport will register a decline in the number of containers handled.
Between August 8 and September 8 Malta Freeport had an average of 1.56 ships per day. The hyped up "busy time at the Freeport" on Thursday/Friday (August 8/9) were exceptional days when 5,000 containers were handled over two days. Extending those two exceptional days to all the 356 days of this year would result in 912,500 containers by the end of this year.
In March this year Malta Freeport lost the Grand Alliance to Gioia Tauro. The Freeport management should produce monthly figures of containers transhipped so that an upward or downward trend can quickly be established. The EPIC service, consisting of P+ONL, Safmarine, Contship and one of the services of CMA-CGM, is set to return to Gioia Tauro this month taking with it another small segment of business from Malta Freeport to Gioia Tauro.
More losses
Gauging Freeport's success in financial terms, the losses that have run up year after year are added confirmation of Mr Hili's bankruptcy because without monumental government subsidies the Freeport cannot continue to operate in as much that its revenues cannot cover its operating and overhead costs. Last year the Freeport lost $1.5 million. Its accumulated losses went up to $14 million.
Year after year taxpayers have been financing the Freeport's capital investment of over Lm3 million annually. Even worse, this year alone taxpayers will be subsidising the interest payments of Malta Freeport to the tune of Lm8.2 million. Freeport's debt forms part of the public debt referred to in Labour economy spokesman Leo Brincat in his question (PQ 32,856) to Finance Minister John Dalli. Generations not yet born have already been condemned to pay the debt incurred by those who ran the country since 1987 with a "money no problem" mentality and with the slogan "Let our children pay".
If the present prime minister has his way future generations might also be asked to pay for the erection of a monument to Marin Hili.