Lecture 6: Port Ownership Flashcards
What is a Public Service Port?
Fully controlled by Port Authority/Ministry of Transport; owns, maintains, operates all assets; employs labour; focuses on public interests; leadership by public officials; common in developing countries.
Strength of Public Service Port?
Unity of command,
Weakness of Public Service Port?
Lack of internal competition, inefficiency, not market-oriented, underinvestment, lack of innovation.
What is a Tool Port?
Partly controlled by Port Authority; owns infrastructure and superstructure; leases superstructure to private cargo handling company; public employs labour except onboard vessel and apron.
Strength of Tool Port?
Avoiding duplication of facilities (wholly provided by govt)
Weakness of Tool Port?
-Conflict of Interest due to split operation
-Limited Future expansion as private operator does not own major equipment
-Risk of underinvestment
-Risk of Lack of innovation
What is a Landlord Port?
Port Authority/ MOT acts as regulatory body (ensure port safety regulations) and landlord that owns and maintains the port infrastructure that will be leased to the private port operator
The private port operator provides and maintains their own superstructure and employs labour for cargo handling activities
Aims to strike a balance between public and private interests
Dominant port model in busy medium/large sized ports (e.g. SG, HK, Rotterdam,, L.A.)
Strength of Landlord Port?
Market-oriented, no government interference in operations, encourages innovation and efficiency.
- Single entity to operate and likely make long-term investment
Weakness of Landlord Port?
-Risk of misjudging the proper timing of capacity addition
(usually due to poor communication betw govt and private operator)
, risk of overcapacity or poor timing of investments.
What is a Private Service Port?
Fully privatized; private sector owns, maintains, and operates all assets and infrastructure; focuses on private interests.
Strength of Private Service Port?
- No Government Interference
- Max. Flexibility to invest in port operations
- Market-Oriented
Weakness of Private Service Port?
Risk of monopoly, national security concerns, government loses financial and strategic control, job creation not prioritized.
What are the 4 types of Port Ownership?
Public Service Port, Tool Port, Landlord Port, Private Service Port.
What differentiates the types of Port Ownership?
Ownership of infrastructure and superstructure, private/public/mixed service provision, and status of labour and management.
Where is Landlord Port model most commonly found?
Busy medium to large ports like Singapore, Hong Kong, Rotterdam, and Los Angeles.
Why are Private Service Ports rare?
High capital intensity, national security concerns, and difficult government approval.
What is a challenge for Public Service Ports?
Inefficiencies from lack of competition and innovation.
What is a challenge for Landlord Ports?
Balancing public-private interests and ensuring communication to avoid overcapacity.
What is the key focus of Private Service Ports?
Maximizing private interests, profit, and operational flexibility.
