Among the gamut of monopolies and cartels that the Israeli economy has to suffer, there is one private monopoly that has no equivalent in any other western state. This is Maman, the cargo-handling facility at Ben-Gurion International Airport that stores and handles cargo worth $12 billion each year.
Maman was set up in 1975 as a state-owned company and was entrusted with the job of providing logistical services at the airport. In 1989, it was privatized and became a publicly-traded enterprise, with its shareholders including the Ta'avura firm, controlled by the Livnat family (39 percent), Knafaim-Arkia, controlled by the Borovitz family (25 percent), and El Al (25 percent). The remaining 10 percent is held by the general public.
In January 1995, Maman was declared a monopoly. And then, in 1997, the government decided to let another private company enter the market of cargo-handling at Ben-Gurion, creating competition. But nothing happened.
In 1999, the state and Maman reached an agreement under which an additional service facility would be built between April 2002 and April 2007. Later, additional facilities would be permitted to set up outside of the airport grounds. But nothing ensued from this deal either.
Maman has succeeded in torpedoing every attempt, using its political connections or the courts - and this is where we stand today, in 2003, with one monopoly supplying expensive services that make all the country's trade more costly.
Customs boss Eitan Rub supports allowing competition in the field and setting up another facility at the airport. The Israel Export Institute and the Federation of Israeli Chambers of Commerce are also in favor of competition. Antitrust Commissioner Dror Strum slams the slew of monopolies that dominate the passage of goods into and out of the country (the Ports Authority, the Airports Authority, Maman). The Airports Authority, for its part, is against setting up an additional facility outside the airport because it enjoys the fees.
But why is the Transportation Ministry against the idea? Could the reason be linked to Minister Avigdor Lieberman's short-lived and unsuccessful appointment of Ludmilla Grossman as Maman chair?
The tender for the building of an additional cargo facility at Ben-Gurion International Airport has been delayed several times by the Airports Authority; and last June, it failed because the tough conditions made the entire enterprise economically unwise (that's another method of torpedoing). Last month, the High Court held a debate on the matter, and the judges sharply expressed their displeasure with the agreement with Maman.
There is now an interministerial committee, headed by deputy Customs chief Ami Segal, that is looking into the issues and implications of setting up an external cargo-handling facility that would compete with Maman.
Given the breaks, benefits and exemptions that Maman has enjoyed over the years, the time has come to change the rules of the game and completely open the market. Finance Minister Benjamin Netanyahu is all for breaking up the monopolies, and so too is Lieberman.
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