Commercial port management company Fiji Ports Corporation Limited (FPCL) requires approximately $910 million over the next decade to guarantee its long-term financial survival.
And it has revealed that the proposed tariff adjustment would generate revenue closely aligned to that requirement.
The statutory company’s formal submission to the Fijian Competition and Consumer Commission (FCCC) proposes a 48 per cent tariff hike on select international services, with no changes proposed to domestic tariffs to ensure domestic shipping and inter-island trade remain unaffected.
However, the company stated that the effective increase in the total revenue would be capped at 28 per cent because several fee categories remain unchanged.
The state-backed port operator states the adjustment—modelled under the Regulatory Asset Base (RAB) building block framework—is necessary to align pricing with the true cost of modern service delivery through 2036.
“This adjustment is designed to align tariffs with the efficient cost of service delivery over a 10-year regulatory period, as determined under the Regulatory Asset Base (RAB) building block model,” FPCL stated in its submission.
The urgent cash requirement is tied directly to FPCL’s capital investment program of approximately $393 million, focused on critical infrastructure upgrades, rehabilitation works, and capacity expansion initiatives across key ports.
According to the company, much of the core infrastructure – originally developed in the 1950s – was now supporting levels of throughput and vessel sizes far beyond its initial design parameters.
“FPCL’s port infrastructure is operating under increasing strain due to age, capacity limitations, and evolving operational demands,” the statutory company stated.
“As a result, the current port system can be characterised as operating under heightened structural and operational risk, where continued deferral of investment will lead to progressive deterioration in performance, reliability, and safety.
“In practical terms, without timely intervention, these constraints may manifest in the form of increased equipment failures, berth limitations, congestion, and service disruptions to the broader Fijian economy.”
It said the proposed tariff adjustment was essential to enable timely delivery of the investments; prevent further degradation of critical national infrastructure; and avoid the emergence of more severe operational constraints that would impose significantly higher costs on the local economy in future.
“Failure to act at this stage would not only compromise service efficiency but may also necessitate more substantial and urgent tariff interventions in the future to address accumulated infrastructure deficits.”
Fiji Ports’ financial analysis demonstrates that the proposed tariff adjustment will have minimal impact on importers and end consumers.
Port charges represent only 1-3 per cent of total landed cost; and the proposed adjustment would result in less than a 1 per cent increase in total import cost. It stated that accordingly, the impact on the cost of living and business operations was expected to be negligible.
