Introduction
1.2 THE HISTORY OF PORTS: ADVANCED THINKING, PLANNING, AND DEVELOPMENT
An effective way of understanding the future is to thoroughly examine the past. In order to tame the contemporary and future corporate challenges associated with ports, it is necessary to reflect upon the historical events that have shaped the modern concepts on successfully designing, planning, and managing seaports. While the following chapters address modern port planning, technologies, and marketing strategies, the aim of this section is to present a concise timeline of the history of ports and comprehend how learning from the past will help modern port decision makers shape a most promising future.
1.2.1 Ports’ History and Etymology: A Passage, a Journey, and a Haven
This section provides historic evidence to verify how, since the dawn of mankind, global seaports served as the gates of global trade and facilitators of products exchange. The etymology of the word port derives from the ancient Greek poros (πόρος), which means both “passage” and “journey,” which in turn became the Latin word portus, and the modern international port. For thousands of years, seaports have been vibrant centers of
security, environment, channel development, and maintenance. I think the impact may be less significant on the logistical chain, because it is more dependent on port relations with carriers and shippers rather than on inter-port relationships, but lobbying through AAPA can facilitate matters by dealing with institutional and political impediments to trade.
Case Study Sources:
AAPA Interviews: Aaron Ellis, Public Affairs Director
Dr. Rexford B. Sherman, Director of Research and Information
REFERENCES AAPA (2013).
2011 Memorandum of Intent signed with the US Department of Commerce to implement the “Partnership with America’s Seaports to Further the National Export Initiative.”
2011 100th Annual Convention held in Seattle.
Whosoever Commands the Sea, Commands Trade; Whosoever Commands the Trade of the World, Commands the Riches of the World, and Consequently the World Itself.
Sir Walter Raleigh (1552–1618)
civilization involving trade and the exchange of currencies, commodities, and cultures.
The world’s most ancient port known as of today was recently discovered in the Egyptian coast of the Red Sea coast, 112 miles south of Suez, and dates back to 2500 BC at the time of Pharaoh Khufu (Davis 2013). The harbor’s findings, carved anchors and man- made docks, verify a vivid port that served the country’s exports of copper and other minerals.
Extensive archeological evidence verifies that humans built ships since at least the 11th millennium BC: “Papyrella” was a Mesolithic oar boat that dates back to 11,000 BC;
it consisted of many fascicles of thin cane (“papyruses”) tied together with ropes and was used for prehistoric fishing and trade, including the trade of obsidian stone (a semipre- cious volcanic stone used as a cutting and piercing tool) in the Aegean sea (Hellenic Maritime Museum 2013). Numerous ancient ships and rock art depicting ships have been discovered in America, Australia, the Indus Valley, Scandinavia, the Netherlands, Nigeria, and so on. As for England, the ancient “tin islands,” findings confirm that their prehistoric homes were made of whale bones, while they were actively involved in the export of tin and metals (Burns-Kokkinaki 2004).
A modern timeline of global port development encompasses four key eras and out- lines a set of drivers: First, the era of national independence, whose grandeur signified the beginning of the industrial revolution and faded in the 1960s. Second, the era of containerization from the 1960s until the 1980s, a time when global trade had regained its pre-WWII level through manufacturing and trading of value-added goods. Third, the era of logistics, whose rapid expansion lasted from the 1980s to the 1990s. That era saw an intensive production of high value-added goods, while more complex production and trade networks and efficiency resulted in the most profitable ports operations. Fourth, globalization gained momentum in the 1980s and continued throughout the 1990s, by means of trade and financial growth around the globe. The author proposes a fifth era in the Post-New Economy era, signifying the aftermath of the 2008 global economic meltdown.
1.2.2 Advanced Thinking: National Ports, Diplomacy, and Economy
While examining history, the role of shipping in a country’s diplomatic and economic strategy can hardly be exaggerated. To quote Sir Walter Raleigh (1552–1618), “who- soever controls sea trade, eventually controls the world itself.” Four centuries later, his belief becomes more timely than ever: from the British Empire, to the American dream and the Chinese and Indian rapid development, the making of a global empire only seems feasible through controlling maritime trade, seaports, canals, and terminals.
The timeline of the customary Western history covers the premodern (pre-1500), early modern (1500–1850), modern (1850–1945), and contemporary eras (Pieterse 2012).
The significance of ports was highlighted between the fifteenth and eighteenth centuries, when the economic doctrine of Mercantilism emerged in the Western Hemisphere. The theory advocated that a positive balance of trade and government control of foreign trade had to be achieved in order to safeguard the nation’s sovereignty and military security.
Building colonies as trading networks grew to become an appealing political strategy.
Nations would retain their role of leadership and accumulate wealth as raw materials and finished goods were traded between colonies and the mother country.
The “First British Empire” era depicts the British maritime leadership that emerged in the seventeenth century, culminated in the eighteenth century, and diminished in
the nineteenth century, during the Age of Revolutions. As facets of a potent British Navy, the North American colonies supplied mother England with precious met- als, raw materials, and finished goods, such as ships and spare parts. The American Revolution occurred during the eighteenth century as 13 states united to break the British rule and establish their national sovereignty by growing their sea power in the Atlantic Ocean.
Essentially, this initiative altered the course of history, and in 1775, General George Washington, who was later to become the first President of the United States, privately launched a compact marine force against the mighty British sea power: “If we mean to be a commercial people, or even to be secure on our side of the Atlantic, we must endeavor as soon as possible to have a Navy.” “In the Service of the ministerial Army,” General Washington directed the fleet to hunt down the globe’s most indomitable naval power (Daughan 2011; Nelson 2008; Palmer 2013). This was the making of the American Empire and the American Dream, sealed by the Declaration of Independence in 1776, while laying the foundations of a mighty and resilient nation.
In the case of America, we observed how a nation’s dynamic maritime activities can strengthen its economy and global role. At the same time, nations have also experienced the retarding effect of introverted economic policies that deprive a country from the per- tinent advantages of sea trade.
China’s history is a vivid example of the adverse results of commercial isolation, fol- lowed by a thriving economy in the twenty-first century.
Deng Xiaoping (1904–1997), China’s leading economic reformer, helped the nation achieve the Four Modernizations by accomplishing specific foreign funds, management, production, and technological innovations, thus boosting its economic development.
Maritime investment was endorsed through developing special trade and economic zones, where market liberalization was promoted. In his words:
No country that wishes to become developed today can pursue closed door policies. We have tasted this bitter experience and our ancestors have tasted it. In the early Ming Dynasty in the reign of Yongle when Zheng He sailed the Western Ocean, our country was open. After Yongle died the dynasty went into decline. Counting from the middle of the Ming Dynasty to the Opium Wars, through 300 years of isolation China was made poor, and became backward and mired in darkness and ignorance. No open door is not an option (Ferguson 2012; Murphey 2007).
Modern China is a global economic and shipping magnet with an average annual growth of 9% between 2001 and 2012. Although the country has not been immune to the global shocks of 2008, it has enjoyed a tremendous growth since 2001, when it joined the World Trade Organization and liberated its stock exchange system. And yet, prior to the Industrial Revolution, China was alienated from global trade and adopted an introvert policy focusing in rice production, with severe effects on population growth, reduced earnings, health, and economic output. Among the lessons learned, what is cer- tain is that a country that wishes to control its economy first needs to control its sea trade and global agreements.
1.2.3 Ports History, Planning, and Development
To investigate the significance of ports, we must comprehend the trade patterns throughout history. Civilizations have traditionally been using their seaports as tools for establishing
diplomatic and trade relations with other nations, accumulating wealth, conquering geo- graphic boundaries, and minimizing global distances. Through maritime history, ports and ships transform their world into a fusion of markets, commodities, and factors of production.
The ports selected in this subsection have one thing in common: they all have under- gone great challenges, fluctuations, and yet they have thrived throughout with consis- tency and flexibility. Having to select among numerous, perhaps hundreds of ports that at some point in history achieved global leadership and recognition was not an easy task. Fortunately, there is a great number of leading ports that thrived and demonstrated exceptional achievements through genius, unity, endurance, and continuity. Many of these will be used as case studies throughout this book.
a. The Port of Houston, Texas
Houston’s story is one of persistence and triumphantly overcoming adversities.
In the 1820s, a new European settlement established an active shipping center (World Port Source 2013b). In 1836, the new Republic of Texas was established;
the port’s first dock was constructed in 1840, followed by the first railroad (1853).
Subsequent to the American Civil War (1869), the Houston Ship Channel in the absence of funds for deepwater dredging focused on its regional railroad cen- ter. Since the 1890s, regional authorities and businessmen attempted to obtain funds to support the Channel’s deepwater dredging activities. Their efforts were unsuccessful, until oil was discovered in 1901, in Spindletop, Texas (Museum of Houston 2013; Port of Houston Authorities 2013). Patillo Higgins, the “Prophet of Spindletop,” partnered with Anthony Lucas, an inventive engineer, and advocated their salt dome theory to secure funds for drilling (World Port Source 2013b).
As the Port of Houston’s cargoes shifted from timber and cotton to global oil trade, the ship channel needed deepwater dredging to accommodate larger vessels. US Representative Tom Ball, Mayor H. Baldwin Rice, and other busi- ness leaders proposed a revolutionary plan whereby the dredging cost would be equally shared between Houston and the federal government (Houston Ship Channel 50th Anniversary Collection 1926–1964). The US Congress unani- mously accepted the “Houston Plan” proposal, and its concept was implemented in multiple US ports (Museum of Houston 2013). By 1902, over 500 Texas cor- porations relocated in Beaumont. The Port of Houston’s channel was launched in 1914, and in 2014, it celebrates 100 years as a major global deepwater port (Port of Houston Authorities 2013).
Houston, Texas, is now established as the energy capital of the world, ranking first in US international commerce and has the 10th largest global port.
b. The Port of Shanghai
Shanghai in Chinese means “Climbing Above” (Shang) “The Sea” (Hai). The thousand-year-old history of Shanghai has been subject to volatile periods of You’ll never find oil here.
Calvin Payne Standard Oil (Times Magazine 1901)
decrease and abundance, thus resembling the history of China. During the Sung Dynasty (960–1279), the Administration of Mercantile Marine was established, with a toll house for merchandise. Between the tenth and thirteenth centuries, the port had gained importance as a “trading station,” as indicated by its name change
“ShangHai Chen” (Madrolle 1912), whereas Chen means harvester, farmer, and a gold collector (Oxford Advanced Learner’s English Chinese Dictionary 2012).
During the Ming Dynasty (1368–1644), the Chinese financial system was manifesting signs of capitalism. Yet, Shanghai was not as developed as the indus- trial centers of Beijing, Nanjing, Yangzhou, and so on. The port’s commercial development was restricted because of the ban of shipping activities and per- tinent trade-restraining policies. The Ming seafaring expeditions ceased unex- pectedly after 1433, the reasons being (a) the high cost of ocean-going journeys, (b) safeguarding against the Mongols’ threats, and possibly (c) the perception of growth through sea trade and control of the seas was incompatible to the Dynasty’s aspirations.
Shanghai evolved during the late Qing Dynasty (1644–1912) as one of China’s principal trading ports (Murphey 2007). In 1684, the Shanghai port was authorized to trade with foreign vessels, as it obtained exclusive control over customs tariffs and charges for all international trade in Jiangsu Province.
By 1735, the Port of Shanghai became the Yangtze region’s most prominent sea- port. The Canton System (1757–1842) served as China’s method for regulating foreign trade in its own territory. In 1842, the Anglo-Chinese Treaty of Nanking declared Shanghai as the major port in China that handles foreign commerce, thus empowering the port to develop into a global trade center (Dermigny 1964).
The treaty opened the Port of Shanghai, and other key ports for trade, that is, Ningbo, Canton, Xiamen, and Fuzhou (Madrolle 1912). British and American merchants united in 1863 to establish the International Settlement in the Port of Shanghai, while the French retained an independent French Concession. At the time, the port had six large docks and enjoyed a high accumulation of foreign ships. Its significance grew immensely as it engaged a crucial strategic location for trading with the West (Bullock 1884). By the early 20th century, Shanghai was the greatest seaport and city in the Far East. In 1949, with the People’s Republic takeover, the financial regime had a debilitating impact on Shanghai’s sea trade, infrastructure, and investment capital.
As soon as the central government granted Shanghai the power to implement financial reforms in 1991, the port has evolved at a soaring rate, becoming one of Asia’s financial centers and the busiest container port in the world (World Port Source 2013c). Throughout modern Chinese history, the Port of Shanghai has been a considerable contributor of tax-related funds in China.
c. The Port of Piraeus, Greece
The ancient oracle and the Greek Shipping Legacy
The Port of Piraeus has been Greece’s major seaport for over 2500 years, and this is a significant honor to bear. Being the Port of Athens, capital of Greece, it has enjoyed eras of remarkable prominence and glory, at times of both war and peace. While modern Greece struggles to survive from its Sovereign Debt Crisis pursuant to the 2008 financial crisis, the port’s history is here to remind us that shipping will help the nation find its way out of the crisis.
Greece and prehistoric sea voyages of 13,000 BC
Greece is a small, yet extraordinary country of 50,942 square miles, whose size is one-fifth the size of Texas. The nation’s intense, almost religious con- nection with the sea trade dates back from prehistoric times. This can be justified by its 6000 islands and an enormous coastline of 13,676 km that can only be compared to the coastlines of the greatest maritime nations on the planet, that is, the United States (19,924 km), China (14,500 km), and England (12,429 km) (CIA World Factbook 2013). To the Greeks, the seas have only been a path of growth and survival.
Archeological findings in Franchthi Cave (Argolis), between 1968 and 1976 under the leadership of Thomas W. Jacobsen of Indiana University (United States), have discovered a prehistoric reed boat made of papyrus (hence called Papyrella). In the cave, a vast selection of lava-generated obsidian stones was discovered, together with 500 tools. European laboratory analyses have deter- mined it as deriving from the island of Melos, which is 80 miles away.
The primary obsidian stones from Melos island discovered in the Franchthi Cave are dated in the late Paleolithic era at 13,000 BC, as verified using mod- ern techniques known as “obsidian hydration dating” and a most innovative method named “secondary ion mass spectrometry.” The small reed-papyrus boat has been restored and exhibited in the Maritime Museum of Piraeus. A simulation of this prehistoric voyage reveals that the boat’s speed was only 2 miles per hour. Taking into consideration the adverse currents encountered in the open seas, 52 hours were actually needed for this 80-mile voyage.
500 BC: Port of Piraeus and Its Long Walls: The First Ancient Maritime Security Measures
The Port of Piraeus was a major seaport that first gained glory during Greece’s “Golden Century,” that is, fifth century BC. In 480 BC, the Persian king Xerxes occupied Greece and the port was considered as a high-risk tar- get because of its strategic location as a passage from Asia to Europe.
This is when the infamous “Long Walls” were constructed all around the city of Athens and the Port of Piraeus, securely linking the cities to the port at times of war.
These two port-and-city-protecting walls were 16 miles (26 kilometers) long and were designed to serve two purposes: (a) as military-defense barrier walls and (b) as protected logistics corridors where the military and food supplies would move safely and unobstructed. This remarkable construction was also enhanced with a double-gate system, to deter the enemy’s entry. The purpose of this design was that even if attackers would concentrate their full force to the outer gate, they would in fact be trapped between the two gates, in the mercy of the Greek forces. The solid structure, the architecture, and overall concept of the long walls were a significant achievement in the history of Greece (Foucart 1887; Frazer 1898; Pausanias 2nd century AD, descrip- tion of Greek, Book I: Attika).
This strategic construction of solid rock walls prevented the heartland of Greece from being surrounded by land or sea. The Port of Piraeus underwent reconstruction (i.e., modern-day retrofitting), and the Long Walls were forti- fied numerous times, to ensure national sovereignty.
Thucydides, an ancient general and historian (460–398 BC), named the Port of Piraeus “Greece’s commercial heart, the major point of entry into the country.”
Themistocles and the Oracle on the Persian Invasion
Themistocles was a highly skilled general and politician, who led the Greek military operations in view of the Persian invasion. It was custom- ary for the political leaders in antiquity to consult the High Priestess in the Delphic Temple of Apollo, seeking for an oracle that would inspire their stra- tegic and tactical military operations.
The Priestess’ oracle for Themistocles was that only Wooden Walls would help the country avert an attack from the Persians, thus implying that the solid Long Walls made of stone were not sufficient.
Themistocles convinced his people that ships were the “Wooden Walls”
of the oracle. Hence, he utilized the funds from the Lavrion mines and gath- ered donations from the aristocracy. He managed to build 400 ships with an equal amount of ship sheds situated next to the Roofed Arsenal and the Hippodamian market place (Foucart 1887; Ludlow 1883).
These ships were capable of averting the Persian invasion and saved the entire Europe from what would be a colonization of the West from the East.
Modern-day Piraeus reflects the glory and the prosperity brought by the Greek shipping tycoons of the twentieth century, like Onassis, Niarchos, Livanos, Carras, to name a few. Today, Piraeus remains one of the greatest ports in the oil-and-gas-rich Mediterranean basin. It is one of the largest con- tainer ports in Europe and a leading global destination for luxury cruise ships.
Overall, the port serves over 24,000 ships each year, which is a remarkable statistical figure for a country on the verge of bankruptcy. COSCO shipping and the government of China have secured special privatization and concession agreements to utilize the port’s unique strategic location, where Chinese car- goes are being handled and distributed in Europe through sea, land, and air.
The oracle, or rather Themistocles’ interpretation of the oracle, is verified millennia later. In the turbulent times of modern Greece, the “wooden walls”
oracle is more timely than ever:
The high seas are Greece’s only way to financial prosperity, as, despite the crisis, the nation remains a leading global maritime power (second after Japan), carrying 16% of the global cargoes.
d. The Port of Istanbul (Constantinople), Turkey, and the Bosphorus Canal
Over millennia of rich history, this epic port still attracts tremendous commercial and diplomatic attention, because of its unparalleled geopoliti- cal location: situated between the East and the West, this port still facilitates global trade between Europe, Asia Minor, Russia, and the landlocked, oil-rich Caspian Sea. The ancient port of Lygos was founded in thirteenth century BC as a Thracian colony. In 657 BC, it was colonized by Byzas of Megara (Athens). The port enjoyed both riches as a result of trade and political inde- pendence throughout the centuries, when Emperor Constantine I the Great (272–337 AD) moved the capital of the Roman Empire from Rome to the Byzantium port in 324 AD. Recent archaeological excavations have exposed the immense port ruins with dams, jetties, platforms, and anchors, and confirmed ancient and medieval trade and connections with the port of Alexandria and