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ReportNo. 11771-CHA China SoutheastCoastal Region Public Disclosure Authorized StrategicIssues in Portsand ShippingDevelopment December10, 1993 TransportOperations Division Chinaand Mongolia Department EastAsia and PacificRegional Office FOR OFFICIAL USE ONLY Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Dsame,t.flWodd Bank 4 ~Thisdoci4ntIm'a restricteddistribution and may be used by recipients only -in hie 44mia~o hir official duties. Its contents may not otherwise be 4dislosecwithotWoddBank authorization CURRENCY EQUIVALENTS (As of June 1992) Currency Name = Renminbi(RMB) Currency Unit = Yuan (Y) $1.00 = Y 5.45 Y 1.00 = $0.183 Note: The nationalstatstics used In tis report exclude Taiwan,Hong Kong and Macao FISCAL YEAR January 1 - December 31 WEIGHTS AND MEASURES Metric System ACRONYMS AND ABBREVIATIONS COSCO - China Ocean ShippingCompany dwt - Deadweighttons GNP - Gross National Product iMO - InternationalMaritime Organization kt - Knots MOC - Ministry of Communications MOFTEC - Ministry of Foreign Trade and EconomicCooperation MOR - Ministry of Railways SCR - Southeat CoastalRegion SEZ - SpecialEconomic Zone TEU - Twenty-footequivalent unit FOR OMCIAL USE ONLY CONTENTS Preface ......................................... vi Acknowledgments ........................................ vii Executive Summary ....................................... viii I EconomicGrowth and TransportDevelopment ................. 1 Introduction .................................. 1 Characteristicsof Economic Growth ................... 2 TransportationGrowth Trends ...................... 4 Water Transport Development....................... 5 Port Facilities and Current DevelopmentPlans .... ........ 6 Container Traffic ............................... 6 Trade with Hong Kong and Taiwan ................... 8 2 TraffIcForecasts ..................................... 10 Principal DevelopmentTrends Affectingthe SCR .... ....... 10 MaritimeTransport Developmentin the SCR .... ......... 11 Traffic Forecast for the Year 2000 .................... 11 Hong Kong ContainerTraffic ........................ 16 Taiwan ContainerTraffic .......................... 19 3 Key lsues ......................................... 22 A. Introduction ..................................... 22 B. Configurationsof Port Capacity ......................... 23 Load Centers and Their Role ....................... 23 Potential Load Center Locationsand Capacity ............. 24. Feeder Services ................................ 26 C. Intermodal SystemConstraints .......................... 28 Road Systems ................................. 28 Rail Systems ................................. 29 Waterways................................... 30 IntermodalTransfer and Storage ..................... 30 CommercialSystems ............................ 31 Flow of Information ............................. 31 Liability Network .............................. 32 The LogisticalApproach .......................... 32 Thisdocument has a restricteddistribution and may be used by recipientsonly in the performance of their officialduties. Its contentsmay not otherwisebe disclosedwithout World Bank authorization. - ii - D. Institutionaland RegulatoryConcerns 32 Introduction.................................. 32 Financial Resources ............................. 32 Managementand Operation ........................ 33 PlanningMajor Transport Corridors ................... 34 External RelationsImpact ......................... 35 E. TechnologicalTrends in ContainerTransport ................. 35 Introduction.................................. 35 Vessels..................................... 35 ManagementSystems ............................ 36 4 Goals and Recommendations ............................. 37 A. Planning ....................................... 37 MOC/MOFTEC ............................... 37 MOR/MOC .................................. 37 Port Users/Port OperatorsInterface ................... 38 Hong Kong/ShenzhenInterface ...................... 38 SCR's Relationshipwith Taiwan ..................... 39 RegionalPlanning .............................. 39 B. Forecasting...................................... 39 C. Port Operationsand HumanResource Development............. 40 Port Operations ................................ 40 ManagementSkills .............................. 41 Training . .................................... 41 D. Funding........................................ 41 Sources..................................... 41 SCR Port InvestmentNeeds to the Year 2000 ............. 42 E. InformationSystems ................................ 43 F. IntermodalInfrastructure ............................. 43 5 Role of the Bank ..................................... 45 Bank Involvementin Ports and ShippingDevelopment in the SCR 45 Recommendationsfor Future Bank Action. 45 ANNES Annex 1: Background Information on SCR Economy, Ports and Shipping ... 47 Geographyand Population.47 Ports and EconomicActivity .47 Basic Transport Network and Traffic .48 Ports and ShippingAdministration .50 Port Sector Reform .51 ShippingEnterprises .52 Annex 2: Regional Developments.54 - iii - Annex 3: Constraints and Options In Hong Kong ................... 58 AlternativeModal Links .58 Surge Traffic .59 Barge Options.59 Rail Option .59 Terminal 8 .61 Terminal 9 .61 Productivityof Hong Kong ContainerPort .62 Annex 4: Technological Trends in Container Transport .63 Introduction.63 InternationalContainer Transport Trends .63 Vessel Design .64 Roll-On/Roll-OffVessels .67 The Sealift System.69 Container Sizes.69 InformationManagement .70 TABLEs InText 1.1 Gross Output Value. 2 1.2 Industrial Structure in the SCR Provinces. 3 1.3 PrincipalFacilities of Major SCR Ports in 1990. 6 1.4 ContainerTraffic via SCR Sea Ports in 1990. 8 2.1 Cargo Traffic Forecast for the SCR Provinces (Scenario#1) 12 2.2 Cargo Traffic Forecast for the SCR Provinces(Scenario #2) 13 2.3 Waterborne Cargo Traffic Forecast for the SCR Provinces (Scenario#1) .13 2.4 WaterborneCargo Traffic Forecast for the SCRProvinces (Scenario #2) .13 2.5 SCR Seaport Forecast for the Year 2000 by PrincipalCommodity (Scenario #1) .14 2.6 SCR SeaportForecast for the Year 2000 by PrincipalCommodity (Scenario #2) .14 2.7 Forecasts of SCR-GeneratedContainer Throughput for the Year 2000 16 2.8 ContainerThroughput Forecast for Major Ports in the SCR for the Year 2000, Scenario#1 .17 2.9 ContainerThroughput Forecast for Major Ports in the SCR for the Year 2000, Scenario#2 .18 2.10 Table of Estimated Demand at Kwai Chung and Lantau, Using Sliding Growth Scales 5-17 Percent/Year.19 2.11 Volume of SeaborneContainerized Cargo, 1990 .21 - iv - In Annexes Annex 1 1 Mainlandand Island Coastlines ......................... 47 2 PopulationDistribution of the Three SCR Provincesin 1990 48 3 SCR Industrialand AgriculturalProduction in 1990 . .48 4 SCR per Capita Gross Output Value and NationalIncome . .49 5 Highway Density in SCR Provinces .. 49 6 ModalDistribution of SCR Traffic .. 50 7 SCR Vessel Fleet in 1990 ............... .............. 52 8 SCR Distributionof Berthing Length and Deep-WaterBerths ....... 53 Annex 2 1 Growth Rates - GDP, Manufacturingand Port Throughput(TEU) in East Asian Economiesand China .. 55 2 Percentageof Containerizationfor Direct Ocean Cargo by GeographicalZone .. 56 3 Percentageof Containerizationfor TransshipmentOcean Cargo by by GeographicalZone ................ ............... 57 Annex 3 1 Hong Kong ContainerThroughput, 1988-91 ......... ........ 58 Annex 4 1 World ContainerPort Traffic Top 20 (1988-90)............... 64 2 World ContainerPort Traffic by Country/Region-Top 20 (1988-90) .. 65 3 WorldwideContainer Ships in Operationand On Order in 1990 ..... 66 4 Main Characteristicsof Container Ships .66 5 ContractedNew BuildingsTonnage (TEU) Capacity as of July 1, 1992 for Far East and Round the World Routes.67 FIGURES In Text 1.1 SCR Foreign Trade ContainerPort Throughputby Province 7 In Annex Annex 1 1 OrganizationChart of Waterwayand Highway Transport Administration 51 - v - MArS M. 1 SoutheastCoastal Region M.2 GuangdongProvince M.3 Hong Kong Port and Airport DevelopmentStrategy - vi - PREFACE This is the report of a study undertaken jointly by the World Bank and the PlanningDepartment of the Ministry of Communications,Government of China. It deals with: (a) the identificationof strategic issues in the developmentof ports and shippingin the coastal area of the East and South China Seas, from the Port of Ningbo in Zhejiang Province to the Port of Zhanjiang in Guangdong Province and includingHong Kong and Taiwan; and (b) the formulationof goals and recommendationsto deal with these issues. The Planning Departmentof the Ministry of Communicationsand the World Bank each formed a team of experts to conduct the study. The World Bank team was headed by Suitbertus van der Meer. Harold Kurzman, Gunnar Sletmo, C. Stigter, Huikang Xu and ZhengyuZhu were membersof the team. On the Chinese side, Yan Qingbinwas the leader of the Chineseteam, formed by Shen Xueguang,Zhang Zhenying, Zhang Weirong, Lin Bingqing, Jiang Zongfu, Yang Shuilai, Zeng Fuyou, Song Xu and Zeng Yan as interpreter. The teams jointly visited the SoutheastCoastal Region in April/May 1991 and again in March/April 1992. In September 1991, a joint study visit was made to the ports of Le Havre, Rotterdamand Hamburg. In addition, Bank team membersvisited Hong Kong and Taiwan in April 1992. The teams met during August 1992 in Washington and in December 1992 in Beijingfor extensivediscussions of earlier
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