Pan-Pacific Conference XXXIV. Designing New Business Models in Developing Economies

Public Enterprise Reforms: Successful Reform at the Fiji Ports Corporation
Limited
Professor Narendra Reddy and Roneel Reetesh Prakash
University of Fiji, Lautoka, Fiji, phone 679-6640600.
narendrar@unifiji.ac.fj and roneel.prakash@fijiairways.com
ABSTRACT
Public Enterprises all over the world are facing
challenges and going through the reform process.
Fiji is no different and has also implemented public
sector reforms. This article, in particular examines
the challenges, impact and the current changes of a
public enterprise in Fiji under the reform process.
This paper reveals the impact and changes of
reforms. The empirical study was undertaken on Fiji
Ports Corporation Limited (FPCL). This research
paper revealed that the reform process has brought
about much changes, improving the efficiency and
effectiveness of the port sector. It has showed
continued revenue and profit growth with dividends
payment to the government. FPCL has been up
skilling staff through training and development.
Also, strategic plans are in place to improve the
information technology and projects are taken up to
make the ports of Fiji to international standard. The
paper suggests that Fiji needs to consider the
impact of reforms during implementation and the
successful changes in other public enterprises.
Introduction 1
Public Enterprises all over the world are facing
challenges and Fiji is no different thus, going
through the reform process. Public Sector Reforms
are necessary to turnaround the organisation in
terms of revenue generation, profitability and
removing bureaucracy. The old practices of high
government interference, reliance on government
funding, inefficient workforce, high costs and
minimum developments no longer work which
resulted in many countries working on reforms.
These reforms have been driven by various factors.
This article examines the reform process at the Ports
Authority of Fiji, reasons behind the reforms, the
changes, and the impact of these reforms on the
staff and outcome of the restructure. Based on the
data obtained through various documents available,
the paper explores the reform process and the
outcome in one of the successful Government
Commercial Company (GCC) in Fiji. This is an
empirical study based on Fiji Ports Corporation
Limited. The justification for selecting this public
enterprise is that it has gone through the reform
process and successful outcomes. This study is
relevant to cover the gaps from the previous
research and to enhance the knowledge of the
reform process for other public enterprises. The
1 This research paper is a continuation of our previous
paper at the XXV11 Pan Pacific Conference in Bali,
Indonesia, in 2010.
study shows that FPCL has been corporatised and
operating on Public-Private Partnership. It is
operating with a commercial perspective, earning
positive returns on investments and assisting Fijian
Government in reducing debts. It has been one of
the best performing government commercial
companies paying regular dividends to the
government. Some areas still require improvements
to manage and operate efficiently for future
sustainability.
Fiji Ports Corporation Limited
Fiji Ports Corporation Limited (FPCL) initially
started as Ports Authority of Fiji (PAF) in 1975 and
undergone dual reforms. The Private Public
Partnership (PPP) was established between FPCL
and Sri Lankan based company, Aitken Spence PLC
(ASPLC) on 31 July 2013. The two companies’
combined their services in Ports Terminal Limited
(PTL) to provide the international level best
facilities. FPCL sold fifty-one percent of shares in
Ports Terminal Limited to Aitken Spence PLC for
FJ$10.35 million. ASPLC acquired the management
rights of Suva and Lautoka Ports via PTL, it has
bought the shore cranes and only the management
rights but not the assets. FPCL and ASPLC have
entered into a Shareholders Agreement to govern
the finance, administration and performance of PTL
in Suva and Lautoka. It allows FPCL to retain
control of PTL. Port management is governed by
performance based Concession Agreement.
Aitken Spence is one of the largest maritime
logistics company in Sri Lanka and has agreed to
provide its expertise to make the Suva and Lautoka
Ports to world class standard, by permeating better
efficiency, productivity and applying best practices
to make them the leading ports and maritime
logistic centres in the Pacific (FPCL, Website). New
equipment worth FJ$4.7 million was bought to
boost productivity and efficiency and the future
prospects are that Suva and Lautoka Ports
operations are expected to be fully automated
(Valemai, 2015). There has been a substantial
increase in revenue and profitability with lower
overhead costs, better ship turnaround times, higher
volumes which resulted in dividend payouts to
government, employee bonuses and pay rise. PTL
was rebranded to Fiji Ports Terminal Limited
(FPTL) in February 2015.
FPCL underwent a partial-privatisation initiated by
the government in November 2015. Government
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