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This paper presents an analysis of the competitive status of hub-seaports in China. The analysis assesses these Hub-seaports based on five factors: service, demand, modernization, facility, and spatial qualities. In order to analyze the competitive status of Chinese seaports in a strategic perspective, we selected those hub seaports located in concentrated economic regions only. This study has applied a multi-decision criteria approach and is based on a comparison of quantitative data.

1.    Introduction

For decades of the execution of the open door policy, the Chinese economy has been booming up. It has been seen that the potential transportation in China is enormous. In particular the Chinese seaport market shows fast growth. Many Chinese hub-seaports have undertaken expansions of their existing seaport systems to accommodate this demand as well as to play a role as regional hub seaport. It’s reported that from 1990 to 2003, the container throughput in the seaports of China rose 31 times and it’s estimated that the container throughput in 2005 will reach up to 75 million TEU, while in year 2004 this number is 61.5 million TEU. This is a fast growth. The container throughput in China has been the first among the global market since 2003.

2.    Seaports in China

In year 2004, the top 10 seaports of mainland China in terms of container throughput are: Shanghai, Shenzhen, Qingdao, Ningbo, Tianjin, Guangzhou, Xiamen, Dalian, Zhongshan, and Fuzhou. Among these seaports, Shanghai and Shenzhen respectively ranged at 3 and the 4 among the global market, both of which’s container throughput over ten million TEU.

And during the past five years the growth rate of seaport container throughput in Mainland China has reached up to 30% in average.

In this paper we only present an analysis of four hub-seaports among all these expanding ports. They are Shanghai, Shenzhen, Tianjin and Xiamen. We make this selection from a strategic perspective. All the seaports in our collection are located in a concentrated economic region, work as the regional hub-seaports, and play an important role in improving the regional economic development. Usually the Shenzhen port serves for the Pearl River Delta as the hub-seaport; Xiamen seaport serves for the Taiwan Channel West Coast as the hub-seaport while the Quanzhou and Fuzhou worked as spoke ports; Shanghai seaport serves for the Changjiang River Delta as hub-seaport while Tianjin port is design by policymakers to serve for the Round Bohai Sea Area as hub-seaport.

In this paper we ignore the port competition within the special concentrated economic regions, like Fuzhou challenges Xiamen while Qingdao challenges Tianjin, and just examine these ports we selected. In a strategic perspective these ports will become more and more important in China’s international trade.

3.    Definition of competitiveness

Even though the competitiveness of seaport depends on all elements that related to the port performance, we only detect five factors which we thought are vital to the competitiveness. These five factors are especially important to hub-seaports.

1.      Spatial factors: the seaport is powered by the regional export and import, so the economic hinterland development decides the demand of the seaport services while the natural environment and the intermodal access decides the convenience of the port services.

2.      Facility factors: the berth capacity and container throughput.

3.      Demand factors: The sea route number and the calls to ports mainly represent the demands to the ports.

4.      Modernization factors: The information technology system and modern equipments can reduce cost, save time and improve services.

5.      Service factors: the loading and unloading efficiency, the customs classification procedures and the average time of vessel at port.

The components of each of the above five factors are defined as follows:

²       Spatial factors ( ) and its component factors ( ): =economic hinterland; =policy environment; =intermodal access; =industry development.

²       Facility factors ( ) and Its component factors ( ): =berth capacity; =container throughput; =container terminal number; =equipment and machine.

²       Demand factors ( ) and its component factors ( ): =destination port number; =sea route; =month frequency of calls to port.

²       Modernization factors ( ) and its component factors ( ): =EDI; =GPS; =CCTV; =other technology and systems.

²       Services factors ( ) and its component factors ( ): =loading and unloading efficiency; =import customs classification procedures; =export customs classification procedure; =average time of vessels on port; =container treatment.

A multi-decision criteria is used to analyze the involving seaports’ competitive strengths; we use the percentage value to evaluate the contribution of the component factors of each of the five core-factors. And the aggregate percentage value of these five factors is expected to express the competitiveness of the hub-seaport.

In order to get the comprehensive competitiveness, we use three steps to make the calculation and some equations are also used:

Ø        We first calculate the competitiveness of the component factors of each core-factor: = /  ( : means the component factors of ; : represents the core-factors; C: the cities we selected; 4: means we select four cities; i: means the number of the component factors; n: the number of the five core-factors)

Ø        Then we calculate the competitiveness of the five core-factors we used in this paper: =  ( : the competitiveness of the component factors; : the competitiveness of the core-factors)

Ø        At last we get the competitiveness of these four cities. Although it may need further treatments: =

4.    Analysis of the competitive strength

4.1. Spatial factor performance measurements

4.1.1. Economic hinterland:

Resource: http://www.gov.cn; http://www.tangshan.gov.cn/bbs/dispbbs.asp?BoardID=2&ID=271&page=1

4.1.2. Intermodal access:

Resource: http://www.shippingchina.com/nation_port_n.php

4.1.3. Business environment:

Resource: search from internet[I]

4.1.4: Evaluation of spatial factors:

4.2. Facility factor performance measurements

4.2.1. Berth capacity

Resource: search from internet[II]

4.2.2. Container capacity

Resource: search from internet[III]

4.2.3. Port equipment and machine

Resource: search from internet[IV]

4.2.4. Evaluation of facility factors:

4.3. Demand factor performance measurements

4.3.1. Sea route destination number:

Resource: search from internet[V]

4.3.2. International sea route number:

Resource: search from internet[VI]

4.3.3. Month frequency of calls to port:

Resource: search from internet[VII]

4.3.4. Evaluation of Demand factors:

4.4. Modernization factor performance measurements

Resource: search from internet[VIII]

4.5. Services factor performance measurements

4.5.1. Loading and unloading:

Resource: search from internet[IX]

4.5.2. Import customs classification procedures (Negative number):

Resource: search from internet[X]

4.5.3. Export customs classification procedures (Negative number):

Resource: search from internet[XI]

4.5.4. Crane operation efficiency:

Resource: search from internet[XII]

4.5.5. Evaluation of services factors:

5.    Overall evaluation:

The above tables include the original data of the component factors and the processed data, the result of the first and second steps of our calculation. With these intermedial data, we can go to the evaluation of the last step:

The results indicate that:

        First: among these four hub-seaports, Shanghai is the most competitive port and Shenzhen is the second. At year 2004 Shanghai’s container throughput ranged 3 at global market and top one China; Shenzhen’s container throughput ranged 4 among global seaports and the second in domestic market. This means Shanghai and Shenzhen has succeeded in achieved the goal the policymakers designed for them.  Xiamen is the least competitive one with its international ranged 29 and domestic ranged 7, so there is still a long way to its goal. While Tianjin just partly achieved the goal the policymakers designed for it.

        Second: if we saw these four seaports as China’s all seaports and their competitiveness represented China’s overall seaports competitiveness, then Shanghai contribute 36% to China’s seaport competitiveness, Shenzhen 26%, Tianjin 19%, and Xiamen contribute 11%.

        From figure 3, you can see that there is an error of 8% happened to our statistics. This may indicate that our research or count method should be further improved. But this is an acceptable figure.

6.    Conclusions:

This paper presents you a quantitative approach to examine and understand the hub-seaports development in mainland China, rather than a pure qualitative statement. 

From a strategic perspective we selected Shanghai, Shenzhen, Tianjin and Xiamen seaports to take this survey. These ports are designed by the policymakers of China to serve as hub-seaports for those four concentrated economic regions: Pearl River Delta, Channel West Coast, Changjiang River Delta, and Round Bohai Sea Area.

The evaluation of this paper indicates that the development of these hub-ports in mainland China is powered by their respective economic hinterland. Shanghai is the most competitive port because its economic hinterland has the largest economic scale and population. Even though Xiamen seaport only ranged at 29 internationally and a domestic range of 7, but its performance is outstanding relative to its economic hinterland scale. The development of Channel West Coast area is not as flourishing as other three concentrated economic regions because the uncertainty of the political relationship between Taiwan province and mainland China during the past decade. But we believe that after the unification of the two sides of Taiwan Channel, this region will be booming up quickly.

The study indicates that with the Chinese economy being booming up, the hub-seaports in mainland China will expand quickly to accommodate the prosperous international trade.

Reference:

Yonghua Park, (2003). An analysis for the competitive strength of Asian major airports, Journal of Air Transport Management 9, 353-360

James J. Wang, Brian Slack, (2000). The evolution of a regional container port system: the Pearl River Delta. Journal of Transport Geography 8, 263-275

Zhang Lianjun, Zong Peihua, (2003). Study on evaluation of index system for port competitive-force. World Shipping (Chinese Journal) 8, Vol.26-No.4

James J. Wang, Adolf Koi-Yu Ng, Daniel Olivier (2004), Port governance in China: a review of policies in an era of internationalizing port management practices. Journal of Transport Policy 11, 237-250

Data Resource: