Review of Port Balance Sheet Capacity Draft

Publication Date
01 June 2012

This draft report sets out a summary of findings of a review of the balance sheet capacities of eight Australian ports carried out by Deloitte Touche Tohmatsu.

Under the National Ports Strategy, it would be envisaged that port infrastructure would be operated on commercial lines. The aim of the review was to identify whether the eight Australian ports could operate along commercial lines and attract commercial finance for investment.

Given the projected growth profile in Australia's international trade, particularly for commodities and containerised cargo, the ability of ports to operate along commercial lines and attract commercial finance for investment could be a major issue.

The review highlighted a limited capacity of some ports to fund improvements to infrastructure by using internal financial resources. Reasons for this included apparently low rates of return on existing assets and possibly underpriced community service obligations. Since commercial investment decisions are made on expected returns on assets created, these low returns were not conducive to attracting further investment.

The review offered general comments on its findings and next steps.