EVOLUTIONS AND PORT CITY DEVELOPMENTS IN ASIA
5. Lessons to be Learnt
Table 1 Port characteristics on performances.
Port efficiencies Frequency of Port Calls Port Berthing Time Length Labor Problems
Economies of Scale (e.g., Cargo Volume/Size of Port) Diseconomies of Scale (e.g., Cargo Crowding Out Effect/Port
Congestions)
Material Handling Efficiency Goods Loss and Damage
Flexibility of Operations Process — Large/Odd size Freight, Large Volume Shipment, Special Handling
Port productivity Rate of Container Movement Number of Cranes Moves per hour Port service Working (or Port Operations) Hours
Shipment Information
Provides Assistance in Claims Handling Offers Convenient Pickup and Delivery Times Port Service Coverage — Routes
Reliability
Port management Management Expertise and Aggressiveness Number of Port Operators
Privilege Contracts to Shippers/Carriers Government Taxes and Incentives
Bureaucracy, Custom Administration and Regulations Coordination Between Departments
Port-induced cost Port Charges Handling Charges Loading/Discharging Rate Inland Freight Rates
Others Port Reputation
Port Security (Port Safety/Terminal Security)
concerns. Other than direct head-on competition, [Song, 2002 and 2003]
examined the possibility of co-operation between adjacent container ports in Hong Kong and South China as another maritime strategy.
Section 1.4 has explored into the various factors such as port location, port efficiency, multimodal network and maritime strategy that may have a bearing on port development. Table 1 provides further descriptions of the port characteristics that promote port performances in various dimensions depicted in Table 2.
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Table 2 Measures of port performances.
Competitive performance Volume of TEUs handled Market Share
Annual Growth Operational performance Ship Turnaround time
Pre-berthing waiting time
Percentage of idle time at berth to time at working berth Asset performance Output per ship berth day
Berth throughput rate Berth occupancy rate Idle rate of equipment
Financial performance Operating Surplus per ton of cargo handled Rate of return on turnover
Proportion of General Cargo to Total tonnage handled
and its environment. Every emergent of a hub port city or prosperous mar- itime trade region is seen to astutely leverage on its own advantages, which may be a strategic location in proximity to major trading axes and affluent markets, advanced transportation system, superior services and/or modern management practices, and catches on the bandwagon during the special bull period. In turn, a budding maritime industry spurs port developments just as the opening of Suez Canal promotes the growths of many ports in Italy, Greece, India and Malacca Strait along the Asia-Europe line. The pace and degree of port development can be further facilitated by intelligent hard and soft investment in port infrastructure and management, made under careful considerations of its intrinsic characteristic relative to its peers.
In this section, we present some fruits for thought related to oppor- tunities and threats for future port and maritime development in Asia.
First of all, the associations between maritime trade and its business environment will irrevocably continue to hold. With the progressive global integration process, world trade is expected to expand and increase the demand for cargo shipping. More reductions of tariff in maritime trade will be reached through forthcoming conference agreements with lower trade barriers resulting to benefit both the producers and customers. As trade liberalizations across regions continue and invigorate their district economies, more long haul and short sea shipping will be induced and subsequently be developed into highway transportation on sea. At the meantime, China’s Open Door Policy and its membership of the World Trade Organization (WTO) will provide further opportunities for ports that are based in China’s manufacture centers (such as Shanghai, Shenzhen and Tianjin), and also for Singapore and Hong Kong ports that are situated on the crucial route providing China its needed energy and resources.
Second, maritime trade is a part of world economy which directly reflects the sentiments of exports and imports conditions. It has been observed that there is an obvious pronounced change in maritime trade industry after every major downturn or upturn of economy. During the economy recession, consuming markets will shrink, and the volume of world’s import and export dramatically decreases. Contrarily, every boom of economy brings along a boom in maritime trade, as seen from the dramatic developments of both maritime trade and economy in Japan, Korea, Singapore and Taiwan in 1970s. Therefore, in addition to the specifics of port investment, prevailing and forecasted future economic conditions would be another element to be considered when deciding on the timing such investments.
Thirdly, mergers and partnerships in the liner shipping companies have allowed the deployment of ever larger and fewer vessels, with a primary motivation to reduce operations cost through economies of scale. However, this concentration within the liner shipping industry has increased the potent impact of a move by a major port user on the port’s traffic. Coupled with advances in logistical systems that lead to the overlapping hinterlands of ports, the port industry faces heighten competition that entails the need for greater efficiency in ports (particularly, landside technological improvement will be required to reduce the waste or relieve bottlenecks at landside operations) and an ability to meet the changing demands of liner shipping companies. Nonetheless, [Low et al., 2009] noted that the hub- and-spoke systems of operations in the liner shipping companies has also opened up co-operation opportunities for port to engage in collaborative efforts. Besides the port and maritime industry, the economy at large will also benefit from such scale increases and collaborative efforts in the process.
Fourthly, with the advancements of communication and transportation technologies that transcend time and space, the business competition will be in the global market in the coming decades. Despite the intensification of competition, more benefits can expected to be reaped from the scale of global industry that includes product design, manufacturing, orders processing, transportation, retailing and other miscellaneous service sectors.
At the same time, greater emphasis will be placed on maritime trade strategy that optimizes the routing decisions of the entire value chain, spanning across geographical boundaries and comprising multiple transport modes. Naturally, ports as a component of the logistics chain will also have a more significant role to play a key role in export competitiveness, exports and import prices, as well as, the overall competitiveness of an economy.
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Last but not least, port city development may cause land-use conflic- tion, environment pollution and transportation congestion. We see that unrestrained investment may not be a good strategy as seen in the case of the Japanese ports, where there are insufficient traffic and excessive capacity. Instead of being overly port centered, a lot of other factors will need to be considered as well. For example, Hong Kong, having a high population density, high labor cost, limited inland space and traffic capacity, may face problems related to (noise and air) pollutions, congestions and financial impediments in its future development. In Japan, private transport is very expensive and public transportation is often too crowded. Nevertheless, the impact of the latter in terms of pollution and traffic congestion is less severe on a per head basis. In Korea, traffic congestions have resulted in long hours of jams during peak period. For the developing countries like India, [Pacione, 2006] highlighted problems such as the inadequacy of infrastructure (i.e., safe drinking water, hygienic sewage and low cost housing), inability to handle natural disasters (i.e., flooding) and control environmental pollution (gaseous emissions). It may be fortunate for China, who has benefited from the experiences of these developed countries, to construct an artificial port totally on the sea far away from the Shanghai city. Such decision not only helps to alleviate problems related to congestions and pollution, it also effectively solves the problem that the water near Shanghai city is not deep enough for large vessels. Another alternative to reduce environmental pollution in the port city is the development of dry port. The dry port concept is based on a seaport directly connected by rail with inland intermodal terminals where shippers can leave and/or collect their goods in intermodal loading units as if directly at the seaport [Roso, 2007].