The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Mediterranean Shipping Company (MSC), the global shipping giant, is “pulling” its back office operation - and potentially over 40 jobs - from Freeport as a result of the Government’s failure to revoke the 1 per cent Customs administrative processing fee.

Multiple private sector sources, speaking to Tribune Business on condition of anonymity, confirmed that MSC was looking to move its existing Freeport operation to either Curacao or Aruba.

They said the shipping giant became “upset” after Prime Minister Perry Christie, and his government, failed to follow through on promises made in late-2013 London meetings with top Grand Bahama Port Authority, Hutchison Whampoa and MSC to remove the 1 per cent Customs processing fee from Freeport.

As a result, at a subsequent Board meeting, MSC’s Geneva-based global head office decided to relocate the Freeport-based back office.

“They had an annual meeting, and made the decision to pull the back office out of the Bahamas. By the end of February, they will be gone,” one source told Tribune Business.

“The decision has already been made. This is the result of the Government’s refusal to address issues critical to Grand Bahama.”

Manuel Ruiz, MSC’s Freeport-based general manager, could not be reached for comment by Tribune Business yesterday.

This newspaper understands that MSC’s Bahamian executives, realising the decision their head office was about to take, had been desperately trying to reach out to the Government to warn it about the urgency with which it needed to address the situation.

But its pleas have seemingly fallen on deaf ears, with the only issues left to be determined being how many staff relocate to Curacao, and how any get separation packages.

“It’s only a matter of what they can save, who they can move and who’s going to be offered termination packages,” a source said.

It is understood that MSC executives are still hoping to save a training centre development they had proposed for Freeport, and Tribune Business’s sources were divided on how many jobs may go.

Some said the current 40-plus staff would be whittled down to an owner’s representative and workforce of just two, while others said only 10 posts would be impacted.

It is also unclear what the impact of MSC’s back office pull out will be on the Freeport Container Port, where it is the major customer and a substantial shareholder.

Tribune Business understands that MSC is still committing, at least for the moment, its large Panamax and post-Panamax vessels to Freeport.

“It’s not to be lost on us that Jamaica has a port, Cuba has a port, and MSC ships can be very easily moved elsewhere if they want to move them,” a source said.

The decision to introduce the 1 per cent Customs fee in the 2013-2014 Budget, and impose it on Freeport, has hammered the city’s logistics/shipping/transhipment economy, both increasing costs and creating greater inefficiencies.

Tribune Business understands that the Grand Bahama Chamber of Commerce, while inching along, still plans to launch its Judicial Review action against the Government in a bid to overturn the Customs fee and other 2013-2014 Budget impositions.

This newspaper attempted to contact members of the Government, including Dr Michael Darville, minister for Grand Bahama, and Obie Wilchcombe, minister of tourism, for comment, but no calls were returned before press time.