Port Management Essay Example | Topics and Well Written Essays - 3000 words

Port Management - Essay Example The report favours a part public and part private model since all public model has led to economic losses and burden on state budget while all private model may create social risks as massive layoffs. Ports, being public sector units in most of the nations, are target for institutional reforms. The similar port activities when compared in terms of performance differ between ports and even within same region. For e.g. in 1991, Western European ports handled containers ranging from 14 to 30 moves per hour per crane. An Asian port handles 458 containers in three and a half hour while another port in the same region took 2-3 days for same amount of work. The labour productivity also differs between ports. In 1993, a port in Far East employed 7200 workers to handle 200 million tons of cargo while another port in same region needed 52000 strong labour force to handle 150 million tons of cargo. It is evident nations realised that poor productivity and high costs are proving a deterrent to development of trade and national economy (UNCTAD, 1995). Sommer (1999) also noticed that unprecedented increase in world trade led captive port users (having cargo vertically integrated into productio n) to put political pressures on authorities to improve handling facilities and reduce cost of port services. Sommer also points out another important reason for reforms that developing superstructures with modern strategic location and improved efficiency was beyond the funding capacity of public port authorities. Particularly the developing countries are not getting advantages of low cost of production in their land due to the high costs of port services. As an example, loading of a cargo of soybean on board of a ship cost $65 in South American ports compared to only $20 per ton at North American ports (UNCTAD, 1995). Sometimes the port infrastructure does not have major defects yet the cost of port services is too high. In the UNCTAD survey on the ports of Cted'Ivoire, Ethiopia, Kenya and Senegal, the port facilities were reasonably good but the boundary between port and government was rather too heavy. As a result managers were restricted in utilising ports commercially. The unn ecessary intervention by the state and lengthy processing prevented management from responding quickly to market needs by reshuffling operations as the need may arise. Moreover, the decision makers catered to demands of government rather than to the market requirements. If at all the changes were made, these were either too late or too small to be cost effective for the client. Many countries have labour regulations. Excessive Labour and strong trade unions are not market friendly. If market tries to punish a port for not fulfilling its demands, ports are not threatened because government support comes as financial subsidy.