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Katz postpones Ashdod Port privatization for 5 years

Thursday, 27 December 2018 | 16:00

Workers committee source: Katz has granted our wish to remain a government company.

Ashdod Port will remain a government company for the next five years, sources inform “Globes.” Two weeks ago, “Globes” reported that the workers committees opposed privatization and did not want a strategic investor brought into the port, as agreed in the framework of the reform agreement at Haifa Port.

Since the port cannot be privatized without the workers’ consent, the privatization option is off the agenda, at least for the next several years. Ashdod Port workers met with Minister of Transport and Intelligence Yisrael Katz on Monday in his office in Jerusalem in order to discuss privatization of the port. Attending the meeting were Histadrut (General Federation of Labor in Israel) chairperson Avi Nissenkorn, who initiated the meeting; Ashdod Port CEO Isaac Blumenthal; and Government Companies Authority representative Meir Shamra.

“The minister granted our wish to remain a government company and not to issue a tender for a private investor. He left an option for privatization in the future,” one of the leading figures on the Ashdod Port workers’ committee told “Globes.” “If it is decided to act according to the 2005 plan of holding an offering for the company, there will be negotiations with the workers’ committees in which we will demand at least 25% of the shares for the workers.”

As for operation of piers 24 and 25, a principal bone of contention in the negotiations on reform at Ashdod Port, Katz agreed with the workers that no port activity would be conducted on these piers at least in the coming years. If it does become necessary to operate them, it was decided that the government ports company would conduct a special tender.

The Ashdod Port workers committees are demanding that these piers be operated when the new port begins operations for the sake of “fair competition,” mainly because of concern that the state will give these piers, which can handle huge modern ships, to the competing port slated for construction in two years.

“As of now, we demand the operation of piers 24 and 25, regardless of the port’s privatization, for the sake of fair competition. If we reach full capacity at Ashdod Port, the state, together with Israel Ports Development & Assets Company, will take the port’s needs into consideration, and we will be able to use the entire area for the port’s needs,” the workers committee source said.

While there are still quite a few unsolved issues at Ashdod Port, an agreement on the reform at Haifa Port including full privatization of Haifa Port was signed exactly one week ago. Only last week, Ashdod Port chairperson Orna Hozman Bechor, who took part in the Globes Israel Business Conference, promised, “Ashdod Port will not be left behind; an agreement will be signed soon for adding a strategic investor to the port’s ownership.” At the same time, Hozman Bechor emphasized that as of now, the matter was being discussed with the workers’ committees.

According to Hozman Bechor, the workers’ committee originated the idea of bringing in a strategic investor, and she is not intervening. “It’s not as if people waiting in line for this. When they issued the tenders for Ashdod and Haifa Ports, there were three investors. We’ll appoint a board of directors committee to negotiate and sign an agreement quickly,” she declared. Hozman Bechor predicted that an agreement would be signed by next year.

The Ministry of Transport said in response, “Privatization of the existing port was never a condition or part of the reform plan led by the minister of transport; the main principle was full competition between the ports – something that will be realized in both Haifa and Ashdod. The workers tried to prevent the establishment and operation of the new port, and were of course rebuffed. Katz raised the option of a strategic investor a few months ago, and it was endorsed by the Haifa Port workers, who also signed the agreement. Workers at the existing port in Ashdod decided against this plan, and are obligated only by competition itself. This has no connection with the elections.”
Source: Globes

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