Increasing efficiency – increasing return on investment in Mediterranean Ports

1. Increasing efficiency – increasing return on investment in Mediterranean Ports Joint Trade Conference Parliamentary Assembly of the Mediterranean (PAM) and the United Nations Trade and Productive Capacity Cluster Hosted by UNECE and UNCTAD Palais des Nations, Geneva, 4-5 May 2011 Vincent F. Valentine, Officer-in-Charge, Transport Section, Division on Technology and Logistics, UNCTAD

2. World seaborne trade • It is estimated that world seaborne trade by volume amounts to 77 per cent of total world trade. Some 16 per cent of world trade passes overland, 6.7 per cent through pipelines and only 0.3 via air[1]. Source: [1] Lloyds MIU (2007)

3. Port development • Ports are a catalyst for trade development. • Well developed ports attract shippers and spur local enterprises to export • Value added services (e.g. repackaging, engineering and design, knowledge processing, light manufacturing and processing, warehousing and logistics) can be performed within ports or adjoining FTZ. • Consolidation services (e.g.container stuffing) allow smaller exporters to group cargo

4. Challenge for ports: Growing customers • In 2011 Maersk ordered 10 Malaccamax 18,000 TEU ships for delivery between 2013 and 2015 with an option to buy 20 more. • 16% bigger and 20% more energy efficient • Beam: 59 meters • Draught: 14.5 meters • Dwt: 165,000 metric tonnes • Reefer capacity: 600 • Top speed: 23 knots For video explanation: http://www.youtube.com/watch?v=z8f4ESIRK0o

5. Emma Maersk

6. Port’s solution: Growing crane capacity

7. Ceres Paragon – Amsterdam Maximum discharge rate- 300 TEUs ph

8. Jebel Ali Port (United Arab Emirates) The port has 16 Tandem lift cranes Average moves per hour > 60 Twin FEU

10. Shenzhen Mawan Container Terminal, China

11. Re-design of the quay side crane • AMPT – Fastnet crane system said to double present handling capacity • Cranes are suspended from the girders allowing them to deploy more cranes per vessel, For video explanation: http://www.youtube.com/watch?v=zuQzwe8ZmYo

12. Super post-panamax cranes • The latest container cranes with an outreach of 23 TEU cost around US$8million each

13. Global terminal operators have a monopoly of the largest cranes • Global terminal operator control all the ship-to-shore gantry cranes with an outreach specification of 22 rows and above in the following regions: • Caribbean/Central America, • the Middle East, • South Asia and • South Europe • In northern Europe only three out of 108 super post-panamax cranes are in non-global operator terminals. Source: Drewry (2010) Annual Review of Global Container Terminal Operators

14. Public/private control of container terminals(Million teu) • The share of traffic moved by state-owned terminals – other than those controlled by state-backed global terminal operators – is declining. • In 2002 - 22.4% • In 2009 - 20.5% • By 2015 - 19.5% Source: Drewry (2010) Annual Review of Global Container Terminal Operators

15. World container port handling by region and ownership, 2008-2009 Source: Drewry (2010) Annual Review of Global Container Terminal Operators

16. A clean and transparent bidding process Quality and Capacity landside connections (multi-modal) and port infrastructure No Government cap on profits Good safety and security requirements A training and retrenchment of labour plan A clear role for the port authority (e.g. landlord model) Smooth customs procedures Absence of corruption Prerequisites for attracting international terminal operators UNCTAD meeting on Globalization of Port Logistics: Opportunities and Challenges for Developing Countries, December 2007, Geneva

17. Aspects of Port Labor Potentially Affected by Reform • Restrictions on which entities can offer services in the port • Reducing overstaffing • Rigid and outdated job descriptions and duties • Limitations on working hours and days • Inefficient overtime allocation at excessive wage rates • Hiring of port labor exclusively through the unions • Restrictions on output • Unsettled and combative workplace culture • Insufficient training and retraining opportunities • Lack of clear and meaningful productivity objectives • Inadequate occupational health and safety procedures Source: World Bank Port Toolkit

18. Recent activity by global/international operators in the Mediterranean

19. Ranking of Mediterranean Container ports(Millions of TEUs ) 2008 Ranking Ports with Intra port competition Source: Cargo Systems (2008) Top 100 Container ports and Containerisation International Online database 2011

20. Intra Port Competition- Mediterranean Ports where global operators compete head-to-head 2008 Ranking Ports with Intra port competition between global terminal operators Source: Cargo Systems (2008) Top 100 Container ports and Drewry (2010) Annual Review of Global Container Terminal Operators

21. Review of Maritime Transport 2008

22. Port opportunities Import / export port Gioia Tauro Dalian HK S’pore Rotterdam logistics centre port transshipment port Source: UNESCAP (2005) Free Trade Zone and Port Hinterland Development, ST/ESCAP/2377.

23. Other issues to consider • National transport systems need to be linked together with international trade networks. • Road and rail networks should extend into the hinterland • National networks should extend to and across national borders to regional networks (e.g. AH, TAR TEN-T) • ICD should be situated at nodal points combining multimodal transport.

24. Recommendations to improve port performance • Reform labour laws governing port workers. • Seek public-private partnerships as a way to provide investment and increase productivity. • Make the process as transparent as possible and avoid excessive regulation.

25. Further information • UNCTAD’s Trade Logistics Branch www.unctad.org/ttl • UNCTAD’s Review of Maritime Transport www.unctad.org/rmt2010 • UNCTAD’s Port Training Programme http://learn.unctad.org/