Port Tianjin 2030: Longterm Prognosis & future prospects

The port authority of Nangang Industrial zone port Company (NIZPC, part of the port of Tianjin) approached the port authority of Rotterdam for a corporation in 2010. After several visits and exchanges of opinions, a service contract has been signed between the both parties. One of the deliverables in the signed service contract is the long-term planning for the Nangang North-zone; a reclaimed port area in the south of port Tianjin without any plans. However, before the long-term planning for the Nangang North-zone can be formulated, an analysis about the expected quantity of different commodities of the whole Tianjin port must be prepared in order to determine what sectors or industries would have the most market potential to be settled in the area. Therefore, different background information, e.g. about the economic trends and future throughput flows, must be analysed, and finally to formulate a prognosis of the whole Tianjin port area over the long-term. As different background information such as the economic trends and competitors in the vicinity are the “ingredients” of the final prognosis, these must be analysed before the prognosis can be prepared. Considering this structure, a scaling down method will be applied in order to analyse different factors from global economic trends to local sector situations. The structure of this study is as follows: The study starts with a brief introduction about the corporation between the port of Rotterdam and the port of Nangang. This introduction will be followed by the methodology of prognoses. In this chapter, a description about the definition of prognosis and planning will be given, and different methods of formulating a forecast in different sectors and study fields will be introduced. This chapter will be further deepened into the port sector to find out how port economists have drawn a long-term port planning. Finally, the long-term vision of Rotterdam will be used as an example (case study). In the third chapter, different global trends which might affect the port sector will be scrutinized. The most remarkable future developments are among other things the increasing The Port Tianjin 2030: Long term prognoses and future Prospects. Page 8 out 120 Zhankan Li attention of environmental issues (e.g. global warming), the modernised port management systems (such as the application of the ICT in ports) and the scale-up of container vessels etc. The scale will be zoomed into China in the next chapter. One of the main points in the analysis is the 12th five-year plan released by the Chinese national government in March 2011, which has mentioned the expected economic growth path and the macro-economic control policies in coming five years. Expectations are that China’s energy mix will shift from of conventional energy resources (such as coal and oil) to renewable energy resources (such as hydroelectric and Biomass). Moreover, the economy growth will be slowing down with an average annual rate of approximately 5%. Beside these rose-coloured prospects, Chinese economy also has to face different caveats from domestic inflations, polarizing welfare, and political instability. In Chapter 4, the above analysed developments will be applied in the Chinese port sector. Since the Chinese government will be stricter in environmental policies in the future, dirty heavy industries such as steel have to limit their production in order to realize sustainability in the Chinese economy. Therefore, less volume of different raw materials and products of heavy industry might be expected in the future. (E.g. Steel, iron ore, coal etc.) Moreover, the Chinese economy will shift gradually from public investments to private consumptions, as results, the purchasing power for imports of end-products will increase in the coming years which is favourable for the container transportation. The container transportation is also partly stimulated by the expected stronger RMB and the domestic urbanisation process. The port Tianjin will be scrutinized in chapter 5. Currently, the port Tianjin is the 5th busiest port in terms of total throughput (408 million metric tons in 2010) and the 11th container port (10,08 million TEU in 2010) in the world. However, the port did not have a good natural condition such as shallowness and the shortage of lands. After reclamation and deepening constructions, the port is now able to handle mega container vessels of 18,000 TEU. Furthermore, the policies of the port Tianjin will also be implementing in accordance with the five-year program, such as investing in renewable energy infrastructures and the low carbon areas (clusters). The Port Tianjin 2030: Long term prognoses and future Prospects. Page 9 out 120 Zhankan Li This part will be followed by a chapter about the ports in vicinity and competition analyses (chapter 6). Currently, the biggest competitors of port Tianjin are the port Dalian and the port of Qingdao. Because of the industrial characteristics in the hinterland, the commodities throughput of Dalian is mainly bulk port with a limited volume of containers. Qingdao is a sea port with the most throughputs in containers within Bohai, but the port lags behind in total throughput compared to Tianjin. As these ports all have different characteristics but similar size, no one of them can dominate in the Bohai area. Finally, a prognosis about the throughput of port Tianjin in 2030 can then be formulated through the found ingredients. Because of the lack of statistical data, the prognosis will be mainly based on growth rates and the judgmental methods. In this prognosis, three different scenarios have been used in order to reduce the uncertainties and provide an apparent image of different changes which might appear in the future. Moreover, the forecast will be made on the level of commodities, i.e. an estimation of throughput will be made for each commodity in three scenarios. As mentioned before, because of lack of internal statistical data, this forecast is based on data and information found on public domain. Therefore, the forecasts will not be expressed in absolute numbers of tonnage throughput, but the expected growth rates of each commodity and the possible trends in the future.