Assume that the Government of Fiji seeks your advice on how to fully privatize inter-island shipping services to the islands in Lau.

Because of the remoteness of the islands of Lau, the small populations of the islands and small amount of cargo, commercial shipping services are non-viable to the more remote southern islands.

Describe how the following forms of privatization may be packaged together to enable the shipping services to be completely privatized.

 Contracting out shipping services under a franchise arrangement.

Leasing of government interisland ships.

Provision of grants to shipping companies to subsidize uneconomic routes

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The detailed answer for the above question is provided below Fully privatizing interisland shipping services in the remote islands of Lau involves a combination of strategies to encourage private sect... View the full answer