A prominent shipping analyst has suggested that US ports could prosper by actively allowing private investors to take a stake in their operations. According to C. Kenneth Orski, a principal with the Urban Mobility Corporation (UMC), "investment by carriers in port facilities appears to be a growing trend." Orski believes that US ports could profit much more by permitting free market forces to dictate private ownership of terminal operations. Citing the recent example of NYK Line (Nippon Yusen Kaisha)'s substantial investment in Chinese port facilities, Orski said that US ports should ''ramp up'' their efforts to attract similar funding. Japanese carrier NYK Line is poised to take a stake in Phase 3B of Shanghai's flagship deep-water facility, the Yangshan container terminal. The shipping major said it expects to be chosen as one of the investors after a Christmas Eve meeting between its president Koji Miyahara and Shanghai Mayor Han Zhen. NYK's drive to increase its Chinese interests, in what some reports
are calling an 'aggressive expansion', has seen it recently acquire 20% of Dalian's Dayaowan Container Terminals' third phase.
It has also invested in several ro/ro facilities in Dalian along with Shanghai and Tianjin.
Although Orski pointed out that Maersk has done the same in Portsmouth (Virginia), he said that in most cases major improvements and expansion of a port's physical capacity and its intermodal transportation lies with local tax payers.
"That notion-that local tax-supported bonds should finance port expansion-is sometimes being challenged, as shown by a debate in Texas (currently) over who should bear the cost of improvements to the Port of Houston," he noted.
The challenge of expanding port and intermodal infrastructure is resonating strongly with operators, shippers and investors alike, said Orski.
"In the past five years container trade in North America has increased at an annual rate of 6.8%," he said.
While NYK's investment in China reportedly represents a huge cultural shift, Orski is doubtful that the same kind of tolerance will prevail in the US.
"Will the port dialogue include foreign investors?" he asked. "The DP World episode cast a deep shadow on foreign purchases of sensitive US assets.
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