Cabotage backward step say manufacturers

By PAMELA GRAHAM

Manufacturers are lobbying against re-regulation of coastal shipping, arguing it will increase freight rates and erode their competitiveness.

The Government is overdue to respond to a report on the shipping industry, and unions and local shippers have been lobbying for regulation.

New Zealand removed cabotage in 1994, allowing foreign-registered vessels to go from local port to local port.

Local shippers argue some foreigners undercut them by charging less than the cost of moving the freight.

The Government is considering subsidising local shipping using funds collected from road users, says Alasdair Thompson, chief executive of the Employers & Manufacturers Associations (Northern).

"If the Government adopts a backdoor route like this to answer the Seamans' Union call for cabotage, the price will be further under-investment in roads and less efficiency on our coast," he said.

"New Zealand benefits from the absence of cabotage especially in the repositioning of thousands of empty containers to the south for loading and returning north, or heading to export markets." He said freight costs from Auckland to Australian cities were similar to those from Auckland to Christchurch.