Trujillo, L. and Nombela, G. - _Privatization and regulation of the seaport industry_

||**Asia**|
|---|---|
|**China**|Shanghai's port authority and the private firm_Hutchinson Whampoa Ltd._fortned in 1993<br>a joint-venture to create the company_Shanghai Container Terminals Ltd (SCT),_that<br>owns and operates the container terminals at the port. During its first year in operation,<br>SCT handled 25% more containers than in the previous year, and productivity was<br>increased in more than 30%. There are investment plans of $673 million, to be completed<br>by 1999. Moreover, SCT has preferential rights for the development of container<br>terminals at other ports. Hutchinson Whampoa is also involved in the development of the<br>Yantian port, a locations that is intended to become one of the four China's hubs, together<br>with Dalian's Daiyo Bay, Beilun and a port in the Fujian province.<br>The parties that are more interested in the development of Chinese ports are shipping<br>companies with regular services in the region and private investors based at Hong Kong<br>(Peters, 1995). For example, Maersk has a preferential agreement as the main user at the<br>port of Yantian, and P&O has made significant investments in the container terminal at<br>Shekou and in the development of the Tianjin port.|
|**Philippines**|One of the first concessions in the Asian region was the_Manila International Container_<br>_Terminal (MICT),_granted in 1988 to a consortium of private firms. The terminal was<br>concessioned for a 25-year term, and it has had a positive impact on the terminal<br>productivity, since ship turn-round time was reduced a 60%. The concession contract<br>includes a minimum income level guaranteed for the government, and it involves<br>investments for $54 million. There are plans to enlarge further the capacity of Manila<br>with a fifth berth that would permit the port to handle more than I million TEUS/year.<br>Regarding other ports,_Asian Terminals Inc. (ATI),_a joint-venture formed by_P&O_and<br>the local firm_7-R Port Services,_has a 15-year contract with the Philippines Port<br>Authority to operate the South Harbor of Manila (Peters, 1995)._HPH_has won a bid to<br>develop and operate a container terminal at the American naval base of_Subic Bay,_for a<br>25 year-term.|
|**India**|The_Indian Ports Association (IPA)_is opening doors to private participation at seaports,<br>though the process is very slow. The only relevant plans are to grant 3-year BOT<br>contracts to private operators.|
|**Malaysia**|Privatization was initiated in 1986 at the port of Kelang, when the container operations<br>were granted for 21 years to the joint-venture_Kelang Container Terminal_(KCT), formed<br>by the port authority and private investors. In 1992, a second privatization phase was<br>launched, by concessioning the rest of the port's infrastructure to another private<br>company_(Kelang Port Management,_KPM). Although the port authority does not have<br>participation at KPM, it possesses a golden share to keep control over essential issues.<br>The KPM container terminal thus competes with the KCT terminal within the port of<br>Kelang (an example of inter-port competiton).<br>There is a project to develop new facilities at Westport, located also in Kelang. The initial<br>plan was designed by the government to reduce congestion at existent facilities, and te<br>intention was to finance it with public funds. But eventually it was concessioned to a<br>private consortium_(Kelang Multi-Terminal Consortium, KMTC)_with a 30-year term<br>contract. It is planned that these new facilities developed by KMTC will compete against<br>those of KCT and KPM, reinforcing even more the competitive framework of the Kelang<br>port.|

_Sources:_ Juhel (1994), Peters (1995), Hall (1997), Webster y Cohen (1997), Alvarado (1998).

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