Busan is good

New paradigm for port development

Contents

This article was contributed by Yoon Byeong-goo, director general in charge of the ports and harbors bureau at the Ministry of Maritime Affairs and Fisheries. _ ED.

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Korea needs new port development policies to meet challenges such as the changing economic conditions in Korea and the emergence of China as a giant trader in Northeast Asia.

Korean ports have been developed to meet ever-growing demand in exports, imports and transshipments.

However, cargo movement has slowed as a result of the maturity of the economic structure, the relocation of factories overseas and an overall slowdown of the economy. Transshipment has few signs of growth due to fierce competition among ports in Northeast Asia.

In such an environment, Korea needs to shift quantity-oriented port development to development that creates high added value at ports while strengthening their competitive power.

The Ministry of Maritime Affairs and Fisheries plans to develop the area at the back of a port as a port industrial complex to attract cargo transshipped at Korean ports.

In particular, Busan and Gwangyang, the nation's two largest container ports, will be developed as hub ports in Northeast Asia closely linked to port industrial complexes aiming at creating higher added value, modeled after Singapore and Rotterdam.

Port industrial complexes will provide space for reprocessing and labeling of goods for transshipment and will also be linked to nearby industrial complexes as a port-industrial cluster to create jobs, attract foreign investment and thus revitalize the regional economy.

While introducing the port industrial complex, Rotterdam created 12 percent or $24.5 billion of the Dutch gross domestic product (GDP) in 2003.

The ports themselves will be developed into multipurpose ones to meet a variety of demand, such as terminals for cruise ships and marinas for marine tourism. The redevelopment of ports is urgently needed as containerships become bigger and bigger and port facilities are computerized with high processing speed.

Ports should also be centers for recycling and the disposal of a variety of living industrial waste. The Japanese government is drawing up a plan to use 18 ports as centers for disposal of waste.

The ministry opened a center to forecast demand for ports in July, judging that incorrect monitoring and analysis concerning demand may cause serious problems in port expansion amid an uncertain external environment.

The center will check cargo traffic by port and commodity, how ports in Northeast Asia are developed, the trends in marine logistics, and production at industrial complexes, while analyzing factors causing cargo traffic to change.

“The trigger rule,” a rule linking how to develop ports with cargo traffic, will be introduced in developing ports based on analysis and monitoring at the center.

In other words, basic infrastructure construction will be launched in a given criteria in the initial stage and what kinds of facilities are located on the basic infrastructure will be decided in accordance with the cargo traffic. The facilities will start operations in one or two years after completion, as seen in Singapore and Rotterdam.

In particular, the trigger rule is expected to help sharpen the competitive edge of ports as the development plan is set up flexibly depending on changes at home and abroad.