Busan is good

Busan Port to invest overseas

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Busan Port Authority, the state-controlled operator of Korea's busiest harbor, aims to build terminals overseas as part of a $2 billion government-led investment plan designed to boost traffic at the nation's ports.

The port operator may invest in Zarubino, northeast Russia, Rajin in North Korea and in Vung Tau, Vietnam, General Manager Park Ho-chul said in an interview at a shipping conference in Shanghai on Wednesday. It is contributing $100 million to the investment fund, he added.

Korea's role as an Asian sea-cargo hub is under threat because the increasing number of direct shipping services from China to the U.S. and Europe is allowing exporters to bypass its ports. Traffic at Busan, the world's fifth-busiest container port, grew at the slowest pace in 16 years in 2006.

"We're turning our eyes on other countries to attract transshipment cargo," Park said.

Korea set up the overseas port investment fund earlier this year in a bid to bolster the nation's marine transport industry. Port operators, banks, pension funds and other institutional investors were expected to contribute to it, the Ministry of Maritime and Fisheries said on April 20.

Busan expects to boost container traffic 8.5 percent this year to 13.45 million 20-foot boxes, Park said. The volume rose 1.6 percent last year.

The port aims to more than double its capacity to 25 million containers a year by 2015 from 10 million at present, Park said. The plan includes raising the number of berths from 28 to 52, he added. Next year, 12 will open, he said.

The Chinese ports of Ningbo and Tianjin will likely surpass Busan's container volumes within five years, Park said. Three Chinese harbors already rank in the top five busiest worldwide, including Hong Kong and Shenzhen. Shanghai, the mainland's biggest container port, aims to surpass Singapore as the world's busiest next year.

Busan Port has no plans to invest in Chinese harbors at present, Park said. (Bloomberg)

Source: Korea Herald (October 26, 2007)