Port authorities pursue economic & non-economic objectives

Port authorities pursue economic & non-economic objectives

Type of organisation

When asked how they would best describe themselves, the vast majority of port authorities answer that they see themselves as mission-driven entities where cost recovery and profit are a must. Additionally, some port authorities classify themselves as non-economic public bodies, run with general interest objectives. A third and last group of port authorities consider themselves as profit-maximising companies.

Goals of the port authority

Port authorities pursue a mixture of economic and non-economic objectives. On the one hand, the top-3 economic objectives stated are:

  1. Financial sustainability of the port
  2. Maximisation of added value
  3. Maximisation of port throughput

Corporate-like objectives, such as profit maximisation for the port authority or for its shareholders aren’t pursued by many ports and only a few port authorities seem to have strictly economic objectives.

On the other hand, port authorities pursue several objectives that contribute to the general interest of society:

  • Facilitating trade and business. Ensuring that companies using the port to receive imports or ship exports remain highly competitive is one of the most important objectives of freight ports.
  • Ensuring that port activity is sustainable in the long run. Consequently, the balance between the economic, social and environmental effects of the port activities is important for port authorities.
  • Social and economic growth of the region. Port authorities play a key role in the stimulation of growth of the regional economy. Their contribution can be measured in terms of added value, wages, local and national taxes paid, jobs, etc.
  • Developing maritime and hinterland connectivity. It’s important for ports to link goods to consumers and companies in the hinterland to global markets.

Background: Trends in EU Ports Governance

The sixth edition of the ESPO Fact-Finding Report ‘Trends in EU Ports Governance 2016’ was published in June 2016. The aim of the report is to monitor port governance and organisation in Europe and its evolution over time. It is based on a web-based survey that was sent directly to individual port authorities. 86 port authorities from 19 EU Member States, Norway and Iceland completed the questionnaire. Together, they represent more than 200 ports and more than 57% of the overall volume of cargo handled in the European Union.

Governance in the future PORTOPIA platform

The PORTOPIA platform will bring an important value added for ports in terms of governance models. In fact, some of the fields of the ESPO Fact-Finding Report are going to be transferred to the PORTOPIA platform, allowing ports to compare geographical ranges, EU averages and evolutions over time in terms of governance model across Europe.

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