LTV's De Facto: Latvia's port reform at a standstill

Port management reform will not be completed this year. The decision taken by the previous Saeima to establish state companies instead of private Rīga and Ventspils Freeport offices has lost political support, and therefore decisions to complete the reform have become stuck in the Cabinet, Latvian Television's broadcast De Facto reported November 5.

Transport Minister Kaspars Briškens (Progressives) wants to reassess the reform, which likely means the statutory deadline will have to be extended again. As long as there is no agreement among politicians on port management, uncertainty about the future among companies working in the port will continue.

Taking over major ports under state control was the setting of the New Conservative Party (JKP). The plan was to replace freeport administrations with new state-owned companies that would have a controlling stake in ministries. It would disrupt the practice of appointing, without competition, people who are close to the political forces in power on the boards of free ports.

“I very much hope that in this way we will ensure open selection procedures for board and council members, getting a professional and not a political board in the big ports. In this way, we are promoting more efficient management of large ports,“ then Transport Minister Tālis Linkaits of the JKP said after supporting the reform in the government in 2021.

All necessary changes to the laws were adopted by the Saeima half a year before the current Saeima elections. The transitional provisions provided that by the end of 2022 Rīga and Ventspils Freeport authorities had to transfer all liabilities and properties to new capital companies, while the authorities themselves had to be liquidated.

But with the JKP losing voter support and seats in the Saeima, political support for port reform began to wobble. The work was delayed and the Saeima extended the deadlines by one year.

However, it is unclear when, and if, decisions will be made in government to complete the reform. Unlike the two governments lead by Krišjānis Kariņš, the government declaration of Evika Siliņa (New Unity) does not include port reform.

“We had a discussion that it is necessary, but in depth, I think we will only talk when the Ministry of Transport brings real proposals, as we go further, because so far in a month and a half we have not had a discussion about it yet,” Siliņa said of the situation with port reform now.

Transport Minister Briškens, meanwhile, said he was skeptical about the reform, stressing that it only changes the governing body. He believes the reform should be reassessed.

That the reform should be reassessed was agreed by Riga Free Port manager Ansis Zeltiņš. He, too, believes that changing the governing body will make no difference, and now the circumstances are different. Russia's invasion of Ukraine has changed both the geopolitical situation and cargo structure.

"It is certainly perfectly logical and rational, even within this framework alone, to reassess the objective and logic that we want to achieve in the context of reform. Inevitably, there is a security dimension inside. Clearly, the security dimension was before that too, but its role was definitely much smaller than it is right now," Zeltiņš said.

What to do with the reform will be discussed by the parties at a coalition meeting in the next few weeks. The Ministry of Transport said it was likely the implementation deadline would need to be extended again.


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