May 17, 2010, 6:09 AM
EDT
By Chris Cooper and Kiyotaka
Matsuda
May 17
(Bloomberg) -- Port of Tokyo, with 13 percent of the annual
container volume of Singapore, today competed with other Japanese
cities for state funds as the government strives to create a harbor
able to challenge the world’s busiest.
Tokyo,
Japan’s biggest container port, teamed up with Kawasaki and
Yokohama for its presentation to the committee that will pick as
many as two groups to develop. Bids were also made by
Nagoya-Yokkaichi, Osaka-Kobe and ports in northern
Kyushu.
The
government created the competition as Japanese ports have lost
traffic to Chinese, South Korean and Singaporean terminals that
have lower costs. Japan’s ports have also suffered from exporters
such as Sony Corp. and Mitsubishi Heavy Industries Ltd. shifting
production to low-wage China.
“Japanese ports are losing market
share,” Takashi Nagayasu, parliamentary secretary for Land,
Infrastructure and Transport and a member of the selection
committee, said on May 13. “That’s hurting Japanese business, so we
have to fix it.”
The
winning ports will be decided next month, according to Transport
Minister Seiji Maehara. The main selection criteria will include
costs, location and security. The government is yet to say how much
funding will be made available.
“Japan’s port business is a long
way behind other Asia countries,” Maehara said last week. “The
selection process should stimulate ports to improve the efficiency
of their operations and attract private money.”
Singapore,
Shanghai
Singapore, the world’s busiest
container port, handled 25.9 million twenty-foot equivalent units
last year, beating out Shanghai with 25 million and Hong Kong with
21 million, according to figures from the Hong Kong Port
Development Council.
The
Port of Tokyo moved 3.4 million boxes last year. Port of Yokohama,
Japan’s second busiest, handled 2.8 million containers last year,
according to its website.
“It’s
not that Japan’s ports are bad, it’s that they’re expensive,” said
Edwin Merner, president of Atlantis Investment Research Corp. in
Tokyo. It may be “too late” to win customers
back.
Japan
is holding the port competition as the global economic rebound
revives container traffic. Industrywide volumes on transpacific
routes will likely rise as much as 5 percent this year, with
Asia-Europe demand growing even faster, Ron Widdows, chief
executive officer of Neptune Orient Lines Ltd., the owner of Asia’s
largest container line by fleet size, said in
March.
In
2009, Asia shipped 15 percent fewer boxes to the U.S., following a
7.7 percent slump a year earlier, according to the Japan Maritime
Center, as the global recession sapped demand for Asian-made toys,
furniture and auto-parts.
“Cheap
land prices are a big reason to choose Nagoya, " Takashi Kawamura,
Mayor of Nagoya City, told reporters in Tokyo today, while
discussing the merits of Ise Bay, home to Nagoya and Yokkaichi
ports. The Nagoya-Yokkaichi bid “should be chosen for the export
industry of Japan,” he said.
http://www.businessweek.com/news/2010-05-17/japan-port-contenders-bid-to-challenge-asian-rivals-update1-.html