The privatisation of Canada’s major ports could net C$2.6 billion ($2.0 billion; €1.8 billion) to C$3.4 billion in equity, according to a report by the CD Howe Institute.
The study focused on the four largest Canada Port Authorities in Vancouver, Prince Rupert, Montreal and Halifax. Robins recommended these authorities rely on private capital to meet operation and expansion costs, noting that equity drawn from the assets “could be invested in the most pressing infrastructure needs of Canadians”.
Bringing private capital into ports would have little impact on their users in terms of either pricing or customer experience, the report went on to say. Other parts of Canada’s international trade supply chain are already in private hands, including the terminal operators as well as the shipping lines and railroads that carry goods to and from the port.
“The competition facing port operators reduces the need for public ownership of the ports to ensure fair pricing,” the report noted, saying that shippers can switch ports based on a number of factors.
CD Howe’s report came as Canadian Prime Minister Justin Trudeau considers a range of privatisation options. In November, Trudeau hired Morgan Stanley to explore privatisation of the 18 Canada Port Authorities, which own and manage Canada’s largest ports and operate at arm’s length from the federal government.
The report focused on the four largest ports, which combined handle 98 percent of container traffic and 38 percent of tonnage, but he added that the remaining 14 ports would benefit from similar considerations. Fifty smaller regional ports, however, are outside of the port authority system and face separate issues.