#Ports&Shipping- A submission by the European Sea Ports Organisation (ESPO) of its contribution to the public consultation in preparation of the new Connecting Europe Facility (CEF II) for the financial period 2021-2028 was presented last week. 

To prepare its submission, ESPO commissioned a study to investigate the future investment needs of European ports, as well as the past ability of ports to benefit from the different EU financial instruments.

In order to live up to their significant role, not only as primary nodes of the transport network, but also in terms of energy transition, attracting industry and logistics and enabling passengers’ connectivity, and being defined as critical infrastructure, ports need to continue to invest into modern, sustainable and well-connected infrastructure.

The study, executed by Dr. Peter de Langen, Dr. Mateu Turró, Martina Fontanet and Jordi Caballé, estimates that European ports face investment needs of around 48 € billion for the period 2018-2027. These needs are mainly caused by external drivers, such as growth in trade flows, new trends in the maritime industry, decarbonisation and other environmental requirements, digitalisation, automation, urban development and security challenges.

This wide range of investment drivers leads to a very diverse range of investment needs. In spite of this diversity, investments in basic infrastructure, maritime access infrastructure and hinterland connections account for more than half of the projects that port managing bodies foresee for the coming 10 years.

Despite the overall recognition of the significant role of ports and of their diverse responsibilities, projects initiated by port authorities only succeeded to attract 4% of the CEF funding so far and only one-third of the submitted projects received funding.

The study results show  that public funding mechanisms remain a very relevant element for port managing bodies, even though innovative financial instruments are to be welcomed.

Based on the results of the study, ESPO pleads for a strong Connecting Europe Facility reflecting the following elements:

• Grants as an essential component of financing port projects with a high added value but low financial returns;
• A well-defined and transparent methodology to define EU added value, that goes beyond “cross-border” projects;
• Responsible grant management, through a more rigorous cost-benefit analysis;
• A long-term vision on funding priorities allowing the ports to prepare high quality projects;
• Co-financing to be defined on the basis of the funding gap;
• The right level of endorsement: smaller port projects which do not involve national or regional funding should not require prior endorsement of the Member State.

 “The study shows an investment pattern of European ports that mirrors very well the essential and very diverse role of ports for the economy. We strongly hope that the study and our recommendations can help the Commission and EU policy makers to develop a strong CEF II proposal with sufficient focus on the EU added value of port projects. It is crucial in that respect to recognise ports as international infrastructures. Less than 10% of the freight handled in European ports was national traffic. Ports are not only Europe’s gateways for trade with third countries, but also create value for the society which exceeds the national borders. They are the main link between the sea and the wider hinterland and economy.” says ESPO’sSecretary General Isabelle Ryckbost.

“Investments in Europe’s seaports is essential if critical policy objectives are to be met in a wide range of EU policy areas. If Europe’s seaports cannot make the investments that are needed, then key policy objectives in transport, energy and environment will be compromised. In many cases, the main benefits of port projects accrue to the wider community and economy rather than to the port authority itself. This is particularly true when ports invest in basic infrastructure to provide capacity for future growth”, says ESPO’s Chairman Eamonn O’Reilly.

“The participation of the European Seaports was excellent: 73 ports, that represent more than 60% of the total EU port volumes, provided information on about 400 investment projects. As a result, we now have a detailed understanding of the investment needs of European ports.” says PLA consultant Peter de Langen. 

The ESPO recommendations and the study on ‘The Infrastructure Investment needs and Financing Challenge of European Ports’ can be found here.

The study will be officially presented at the forthcoming ESPO conference “Investing in the port of tomorrow” taking place on 31 May and 1 June in Rotterdam. The CEF II proposal is due to come out on 29 May. The Conference will be a unique and first opportunity to discuss the new proposal with its main architects. More information: www.espo-conference.com