The case for privatizing the Port Authority of Montreal

A few days ago, La Presse revealed that the corruption allegations at the Port Authority of Montreal would be dropped. Obviously, members of the opposition criticized the “political back-scratching” that might have occured between the Office of the Prime Minister (via Dimitri Soudas) and some dubious businessmen. Anyways, politics aside, if one really wishes to avoid corruption in the future why not look at the option of privatizing the Port Authority?

The privatization of Port Authorities is – contrary to one might believe – a policy which has yielded very positive results. As a World Bank paper noted back in the late nineties, privatization and liberalization of Port authorities in Colombia

(…)resulted in large and rapid improvements in productivity, lower fees for port users, and very attractive returns for the concessionaires. Productivity levels are higher than in most newly privatized ports in other Latin American countries—where in many cases the ports have been privatized with limited competition. The improvements have been realized with low initial investments, though recently the port societies have gone beyond investing in shoreside equipment and are starting to invest in infrastructure expansion.

The privatization of the Port of Bristol in the United Kingdom by the Thatcher government transformed the port from a loss-making venture to a profitable one in the early one in the early nineties. Hence, taxpayers were not responsible of paying the losses via subsidies. Moreover, this amazing turnaround occured in spite of a relative decline of the importance of Bristol to other British ports.

Maybe its time to look into such a policy course for Montreal, if its private hands, there is little place for political jockeying for positions…




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