Terming the proposed rate hike ‘unprecedented’ and ‘commercially unsustainable’, BSAA requested that the hike be limited to 10-15 per cent and implemented in phases, with at least six to 12 months' notice to allow the global shipping community time to adjust their commercial arrangements.
In a recent letter to the senior secretary of the Ministry of Shipping and the CPA chairman, BSAA chairman Syed Mohammad Arif expressed ‘profound concern’ about the newly imposed tariff and its ‘abrupt implementation date’.
"The magnitude of the increase, coupled with the insufficient notice period, poses a significant threat to the competitiveness of Chittagong Port and the national economy," he wrote.
The new tariff is scheduled to take effect on October 15.
BSAA feels the notified tariff schedule reflects an overall increase of nearly 70 per cent over the existing rates, according to domestic media reports.
"Such an escalation far exceeds any fair or reasonable adjustment, particularly as most CPA tariff items are direct out-of-pocket expenses borne by shipping lines," Arif wrote.
He noted that of the 60 tariff items in the CPA's 1986 schedule, 25 major service categories are denominated in US dollars. At that time, the exchange rate stood at around Tk 30-32 per US dollar, compared with more than Tk 120 today.
As a result, he argued, the value of dollar-denominated tariffs has already adjusted automatically over time. "Moreover, the current tariff structure has also been fixed in US dollars," he wrote.
The decision could erode Chittagong Port's competitiveness, as foreign shipping principals may be compelled to divert their vessels to other regional ports, Arif cautioned. This would lead to a decline in vessel calls at the seaport.
ALCHEMPro News Desk (DS)
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