Port competition in Latin America and the Caribbean: the role of concessions and competition policy

Appropriate port regulation and competitive forces tend to be related to higher levels of operational and economic performance of ports. From a policy-making perspective, pursuing efficiency and securing competition in ports to reach a level playing field is a two-step process requiring (1) ex-ante regulations to set the rules that maximize the competition for the market, especially when the policy objective is to attract private operations to ports on competitive concession processes and (2) ex-post competition policy to monitor and preserve competition in the market. This paper studies port regulation in Latin America and the Caribbean (LAC) from a competition perspective, analyzing both ex-ante and ex-post policies implemented in the region. The analysis reveals that the competitive environment in LAC is low, giving room for possible anticompetitive practices in the LAC port sector. Since the end of the 1990s, approximately 80% of container terminals in the region were granted to only five companies. Chile and Mexico have been found to be the best practices in the region, with better conditions assuring robust competition in the market. The main policy implication from this analysis is the need for a stronger involvement of antitrust agencies throughout the port concession processes.     

Managing port-related supply chain disruptions (PSCDs): a management model and empirical evidence

ABSTRACT

In the contemporary port business environment, port resilience is of paramount importance for supply chain continuity. A result of the increased integration of ports into supply chains is ports’ potential to supply chain disruptions. This paper introduces a PSCD management model that incorporates the application of risk management, business continuity management, and quality management theories with the purpose of increasing port resilience such that supply chain continuity is enhanced. To validate this model, primary data were collected from samples of port operators and port authorities and analyzed using structural equation modeling with AMOS 22.0. The results indicate that managing PSCD using the management model contributes positively to the identification of internal and external opportunities and through that to port’s resilience of internal operations. This, in turn, positively influences port’s financial health and market reputation. The management model has several managerial and academic implications as it offers meaningful insights on policy development as well as theory building.     

Container terminal employees’ perceptions of the effects of sustainable supply chain management on sustainability performance

ABSTRACT

Sustainability has become an important issue in container terminal operations. However, relatively little research has been conducted to assess its association with sustainable supply chain management (SSCM). In this study, SSCM consists of internal sustainability practices and external sustainability collaboration. We empirically examined the effects of internal sustainability practices and external sustainability collaboration on sustainability performance in container terminal operations at the Port of Kaohsiung in Taiwan. We developed a model adopting the SSCM construct, which consisted of two dimensions: internal sustainability practices and external sustainability collaboration. Several research hypotheses were formulated from the theory and the hypotheses were tested using survey data collected from 141 employees who worked with container terminals. We found that internal sustainability practices and external sustainability collaboration positively affected sustainability performance, whereas external sustainability collaboration had a positive influence on internal sustainability practices. There is a discussion of the implications of these findings for developing sustainability and improving sustainability performance in container terminals and ports.     

Comparative analysis of port competency requirements in Vietnam and Korea

ABSTRACT

Much research has been conducted recently on the changing role of ports in the context of international logistics and supply chain management focusing on issues such as port efficiency and competitiveness. However, little research has been found on the critical aspect that contributes to making a port efficient and effective, especially, in the new era: the port human capital. As seaports play a critical role in the supply chain, it is thus important that the port personnel possess necessary competencies to contribute to port efficiency and turn the port into an effective supply chain partner. In this paper, this research issue is explored through a conceptual model of competencies and validated empirically by a survey with port executives in Vietnam and Korea. As a result, important managerial insights are drawn to the design and implementation of human resource development policy for ports.     

An application of BBNs on the integrated energy efficiency of ship–port interface: a dry bulk shipping case

ABSTRACT

A considerable amount of energy is consumed with every completed ship voyage and each port operation performed. Recent regulative approaches by the IMO are to enforce the shipping industry to become more energy efficient and sustainable. There is a growing amount of literature on the energy efficiency management of ships and ports. However, there is still inadequate research effort on the ship–port interface in order to obtain an Integrated Energy Efficiency framework for marine transport operations. In this research, a theoretical concept is generated to measure holistic energy efficiency in shipping operations. The main purpose of this paper is to identify nodes of the integrated ship-port energy efficiency framework and develop a probabilistic approach, which can help to increase energy efficiency and reduce CO2 emissions for shipping companies. This research generates an application of BBNs on ship–port interface regarding the integrated operational energy efficiency interactions by aiming to optimise holistic operational energy efficiency and CO2 emissions. The outcomes suggest that it would be possible to increase the probability of a more energy efficient and sustainable marine transport operation by integrating the influences of port and ship operation performances and their elements on the related route planning and slow steaming decision-making.     

Influential factors in the design of port infrastructure tariffs

ABSTRACT

The main aim of this article is to examine the factors influential to the practical process of port infrastructure tariff design. The analysis is based on the survey data of 67 seaports representing the Australasian, East Asian, European, North American and South American regions. Exploratory factor analysis (EFA) was first carried out to identify the factors influential to the selection of the infrastructure tariff design model. Subsequently, confirmatory factor analysis (CFA) was used to confirm the relationship between the variables. The findings showed that demand, knowledge about pricing theories, the dynamics of port and shipping sectors (including competition and ship size), pricing objectives and port cost consideration are influential factors in infrastructure tariff design. Most ports use a mix of pricing approaches including price discrimination, cost-based pricing and market-based pricing. Ports are aware of the basic pricing approaches but have limited knowledge of their application. Based on the results of analysis, policy implications for port management in designing port infrastructure tariffs, limitations and recommendations for future research are discussed.     

Assessing port governance models: process and performance components

This paper develops a conceptual framework that integrates various relevant port performance components in a way that can be used for a comprehensive port evaluation and adjustment of existing port governance models. The paper presents a synthesis of the literature on port governance models and port performance, arguing that the process of change is a dynamic one, and that the performance outcome of a reform process influences the next round of reforms. It also explores the potential for decomposing performance into two different, although related, port performances components, namely efficiency and effectiveness. Bringing into the analysis concepts like the need to integrate users’ satisfaction in port performance assessment, the paper explores the content of each of these components and their relationship. This discussion, along with empirical evidence provided by port authorities, leads to the conclusion that governance decisions, both at firm and government levels, are largely based on a very limited assessment of port performance. The effectiveness of port reform is largely neglected, with user perspectives not being an integral part of an effort to improve performance by the port or as feedback to assess the effectiveness of the governance model imposed by the government's port policy.     

The visual effects of port redevelopment alternatives

Abstract

In the early 1970s, Seattle Piers 90/91 were declared surplus federal property by the GSA. These obsolescent half‐mile‐long piers and their adjacent uplands were purchased by the Port of Seattle for redevelopment. This urban waterfront site of almost 200 acres presents the Port of Seattle with a number of severe planning problems. While it is the last large deep‐water site on Elliott Bay, it is also in a very sensitive location, since it is overlooked on two sides by vocal residential communities with a history of active intervention in development projects on visual and other environmental grounds.

At Piers 90/91, public concerns over the visual effects of port redevelopment include:

1. nuisance effects of night‐operations lighting on adjacent hillside residences;

2. nighttime obstruction of distant views due to increased foreground illumination;

3. day and night view obstruction by tall structures such as container‐handling cranes;

4. alteration of the character of both day and nighttime views by new port facilities.

As part of a program to study the effects of alternative redevelopment strategies for Piers 90/91, the Port has undertaken a through examination of the visual effects of different uses, their visual appropriateness, and the ways by which adverse visual effects can be mitigated. The results were incorporated into an environmental impact statement which documented compliance with the Seattle Shoreline Master Program and with view protection and glare provisions of the City's S.E.P.A. guidelines.

A systematic Visual Resource Management (VRM) approach was successfully employed on this coastal zone project. Major elements included visibility mapping, key view selection, analysis of existing visual character, simulation of alternatives, assessment of relative visual compatibility, and determination of effective mitigation measures. Community involvement has also been a critical element in this approach to assessing and managing the visual effects of redevelopment in a major urban port.     

The urban port: A hidden resource for the city and the coastal zone

Abstract

This paper is concerned with the changing pattern of activity on the urban waterfront. It examines developments in marine transportation technology and in the economic structure of the central city that have influenced the function of the urban port. Drawing upon data related to the West Side of Manhattan, the impact of the changes in cargo and passenger ship operations on the urban port is described and analyzed. A twofold strategy for public agencies to identify and understand the opportunities presented by technological change and to formulate policies for the redevelopment of the urban coastal zone is discussed.     

A dynamic model for marginal cost pricing of port infrastructures

ABSTRACT

A dynamic model for marginal cost pricing of port infrastructures links costs to system performance by combining a power-law function with time-dependent queueing analysis. Additionally, the model incorporates the marginal cost of capacity, including the effects of economies of scale. This allows the calculation of the marginal cost price under a dynamic framework. The model accounts for nonlinear behaviour of port demand, which is sensitive to price and service levels. The effects over time of cost and service levels on the port’s operational performance are quantified. The proposed model allows determining the optimal timing for capacity investment. The model is a starting point for the application of marginal cost pricing to ports. However, for practical application of such pricing method it is necessary to apply a system’s approach, as productivity and costs must be assessed at the terminal’s component level. This should allow the derivation of a marginal cost function at the terminal’s component level.     

Shorebased Processor Outcomes Under Catch Shares

Abstract

Fishery management measures often aim to regulate harvesting behavior but can have downstream effects on fish processors, output markets, and consumers. Empirical analysis of these impacts is generally limited due to data availability. In this article, we utilize census costs and earnings data to examine operational characteristics and economic outcomes for shorebased processors before and after implementation of the West Coast Groundfish Trawl Catch Share Program. While the overall number of buyers of catch share species along the coast decreased and fish input prices generally increased, patterns in outcomes were different for processors with Pacific whiting operations compared to those that produce nonwhiting groundfish, including lengthened seasonal whiting operations but a decrease in the number of days receiving nonwhiting groundfish. These differences in outcomes illustrate the complexities involved in the management of multispecies fisheries with heterogeneous participants in both the harvest and post-harvest sectors. This review contributes to the fairly limited empirical work on the fish processing sector, which is an integral part of the seafood supply chain and important to the economic resilience of coastal fishing communities.     

The changing role of ports in supply-chain management: an empirical analysis

As integrated supply-chain management (SCM) is now at the epicentre of business transformation, firms are breaking down boundaries between internal functions, as well as between the enterprise itself and key partners in the value chain (e.g. customers, distributors, suppliers and carriers). One of the main goals of such new management approach is to get everyone in the supply chain into a common platform of logistics transactions and information systems.

Against such background, the aim of this work is to analyse how and if port operators can face the challenge of higher integration, on the assumption that the higher the integration between the actors the higher the competitiveness of the whole supply chain.

Accordingly, we adopted an SCM approach in the analysis of the port of Le Havre in Renault's supply chain. More specifically, we referred to the Lambert tri-dimensional model based on supply chain's structure (actors), key business processes and links between actors. The field work—which mainly consisted of semi-structured interviews to Renault, logistics and port operators, and, finally, to the Le Havre Port Authority—was crucial to gather the needed information.     

Artificial forces for virtual autonomous ships with encountering situations in restricted waters

ABSTRACT

Even if the same two ships operate in the same encountering situation, the actual strategies and timing of operations may be different. Therefore, the fixed collision avoidance trajectory and ship movements are no longer suitable for simulating the real ship behaviour. This paper tries to develop an artificial intelligent system that fully sensitive to the local circumstances and command a ship in virtual environment. Based on AIS (Automatic Identification System) data, this study has developed artificial forces which help decision makings on-board independently under different situations and catching the stochastic nature of ship behaviours during collision avoidances manoeuvring. Actual ship tracks are helpful for ascertaining the parameters that contribute to artificial forces in collision avoidances, while the correlation coefficient analysis is helpful to distinguish the parameters. This study will help to develop a navigation traffic simulation to reflect the realistic ship behaviour and provide reliable information for port and waterway planning, risk analysis, and mitigation measures. The method can be used in developing algorithms for autonomous ships. The method introduced in this study lays a foundation for developing artificial forces at intersections or bends, although the model is only applicable in straight channels at the moment.     

Cruise traveler satisfaction at a port of call

ABSTRACT

No studies have been conducted on cruise traveler expectations for a port of call in Asia. Current literature on general tourism shows that the research to measure traveler satisfaction is divided into two dominant approaches, the disconfirmation model, based on the Expectancy Disconfirmation Paradigm, and the perceptions-only model. However, previous disconfirmation models used different sample populations to measure traveler expectations and perceptions, resulting in biased results. The main objectives of this research was two-fold: (1) to develop a measurement scale for evaluating the expectations of cruise travelers during their visit to a port of call; and, (2) to examine the satisfaction of cruise travelers using the same sample population of the pre-visit expectations and post-visit experiences. The measurement scale for cruise travelers was developed using exploratory factor analysis and confirmatory factor analysis. Three factors, “Overall convenience/People,” “Culture/Exploration,” and “Commodities/Attractions,” were extracted from the analysis. Among these factors, the “Culture/Exploration” factor explained the largest part of overall satisfaction. The results also showed that the perception-only model outperformed the disconfirmation model in explaining overall satisfaction. Additionally, overall satisfaction was found to have a greater impact on the intention to recommend the visit to others than on the intention to revisit.     

A simulation study for the logistics planning of a container terminal in view of SCM

This paper aims to apply a supply-chain modelling and its analysis framework to the supply chain in the port industry. The simulation approach serves two purposes: to model a supply-chain network in quantity approach and to evaluate its supply-chain performance based on proposed strategies. Through the modelling works to improve the performance, components of simulation model, such as input model, strategy model, operational policy model and performance model, in the port supply chain were identified. The effects of various strategies can guide the way to administrate the supply chain in the different objectives.     

A simulation study for the logistics planning of a container terminal in view of SCM

This paper aims to apply a supply-chain modelling and its analysis framework to the supply chain in the port industry. The simulation approach serves two purposes: to model a supply-chain network in quantity approach and to evaluate its supply-chain performance based on proposed strategies. Through the modelling works to improve the performance, components of simulation model, such as input model, strategy model, operational policy model and performance model, in the port supply chain were identified. The effects of various strategies can guide the way to administrate the supply chain in the different objectives.     

Which terminals should expand investment: a perspective of internal non-cooperative competition in a port?

ABSTRACT

With the increasing container cargo throughput and the arising of port congestion, container ports start to choose the investment expansion strategy to increase the port efficiency and then to figure out the problem of port congestion. To analyze this strategy, we formulate a non-cooperative game model for a two-terminals-one-port system, and derive the optimal equilibrium outcomes of the investment expansion strategy and investment constant strategy. In the game, we find that when the investment parameter of expansion strategy and impact of handling efficiency on demand changes, both pure-strategy Nash equilibrium and mixed-strategy Nash equilibrium exist, and two terminals are more likely to choose the investment expansion strategy in most cases. Numerical simulation is applied to explore the equilibrium strategy under different circumstance.     

宁波港发展现代物流的模式及策略初探

现代物流已成为我国经济发展的重要产业和新的经济增长点。发展现代物流服务成为港口企业的一种必然选择。通过现状的分析,探讨宁波港发展现代物流的模式及策略。     

Influence of local government on port investment: implications of China’s decentralized port governance system

ABSTRACT

The pursuit of better performance by the local government can influence the investment decision-making related to port expansion. This paper compares the ceilings at which the port enterprise and the local government would stop making investments. To achieve this, the benefits to the port enterprise and the local government are measured over a given time period. An empirical study investigating how a port would respond if a rival port uses a type of capacity investment strategy is conducted for two major ports in Liaoning. The time at which the local government and the port enterprise would stop making investments and the final equilibrium are developed using the data from 2010. From the empirical results, it was found that investment in port capacity contributes greatly to the local government’s performance. Meanwhile, different investment ceilings are discovered for the port enterprise and the local government. This research is meaningful for discussing the institutional relationship between the local government and the port enterprise in China’s current decentralized port governance system.

This paper is a revised and expanded version of a paper entitled ‘Port expansion mechanism in the context of political achievement of local government: a special phenomenon in China’ presented at International Association of Maritime Economists 2012 Taipei Conference during 5th September –8th September.