Fiji Shipping - Safeguarding Shipping Services. What would happen if Goundar stopped sailing?

 

Safeguarding Shipping Service in Fiji

Andrew Irvin, Micronesian Center for Sustainable Transport, andrew.irvin@usp.ac.fj

A stir was caused this past weekend when Goundar Shipping’s social media account circulated an announcement it would be immediately ceasing its operations around the country[1]. 

Though on Monday, Goundar Shipping subsequently announced the social media account was hacked, and it has no intention to discontinue its operations in Fiji[2], the flurry of responses around the ramifications for domestic shipping of Goundar Shipping’s exit from the sector raises a number of questions worth answering in advance of any domestic shipping industry upheaval of similar scale.

As mentioned in the most recent column on COVID-19’s impacts on the economy, domestic shipping is taking a significant hit due to the restrictions on passenger travel beyond Viti Levu. 

Sector-Wide Challenges

Beyond sector-wide challenges, Goundar Shipping has been embroiled in investigations over violations of international labour law around alleged human trafficking of Filipino employees, drawing attention of international organizations and labour unions demanding action on the issue and placing scrutiny on the human rights abuses of a large Fijian business (shortly after Fiji assumed the Presidency of the UN Human Rights Council[3]). It is indicative of public perception around the state of the company, and the domestic shipping industry at large, that the response to the Goundar Shipping social media post was mixed, but largely without surprise.

In the event Goundar Shipping ceases operations without forewarning, it would mean under the government shipping franchise scheme, immediate replacements would need to be established for the 1st Northern Lau route, Rotuma, and the 2nd Yasayasa Moala route[4]. It is unclear if the Government Shipping Services would be able to accommodate service with existing capacity, or other shipping companies licensed to operate franchise routes would be able to devote vessels toward the routes. 

All three are currently serviced by the MV Lomaiviti Princess VII, which is only one of the nine registered[5]. Others vessels operate on non-franchise scheme routes (i.e. Suva-Kadavu, Suva-Savusavu-Taveuni, etc.).

Shuttering Goundar Shipping operations raises three related questions; first, would another private sector company have the capacity to step in and meet the service requirements with their current fleet? Secondly, would another company or the GSS be willing and/or able to absorb the Lomaiviti Princess fleet? Thirdly, with no willing or able buyers, how would these vessels be safely decommissioned? While the industry is at a lull, finding answers to these questions is increasingly urgent, as we know in dealing with economies of scale, no firm is too big to fail.

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