26 April 2017
Singapore’s port depends on the transshipment business, accounting for roughly 85% of overall container volume. Nevertheless, the new complexities in operations and increased cost consciousness of shippers have allowed smaller ports in the region to compete with the maritime hub.
In recent years, overcapacity and low oil prices have driven freight rates to unprofitable levels, increasing the shipping industry’s pressure to consolidate. The sheer amount of logistics needed to service ultra-large container vessels (ULVCs) and mega alliances these days requires ports to have advanced logistics to stay competitive.
So far Singapore’s port has been more attractive for shippers due to the multitude of services and the comparative geographical advantage it offers. Nevertheless, to stay competitive, PSA International and Singapore authorities have committed to a two-step modernisation plan, led by a strategic shift towards transforming Tuas into a major port hub.
… Philipp Martin Dingeldey is a Research Analyst with the Maritime Security Programme at the Institute Defence and Strategic Studies (IDSS), S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University (NTU), Singapore.
IDSS / Online
Last updated on 26/04/2017