Port governance and finance

These skills have required continuous adaptation as port technology has progressed. As with the container revolution in the late 1960s, digitalization will produce great changes in logistics, with major implications for human capital. In the past decade the focus on research into digitalization by dedicated teams has produced a continuing stream of innovations, leading to new business models and technologies that improve efficiency and sustainability.

Some of those innovations have been centrally funded, such as the intelligent shipping program; others have come from port enterprises (Ministry of Transport et al. 2019). For example, China Merchants Port Holdings invests heavily in testing emerging technologies, and Qingdao Port has signed cooperation agreements with several public and private institutions to improve information and communication technology and digital maturity throughout the port cluster.

The 12th Five-Year Plan (2011–15) called for a “comprehensive, smart, green, and safe transportation system.” That goal was translated into the use of multimodal transport systems, greening practices, and digital solutions to enhance sustainability in the port sector. The use of onshore power when vessels are berthed and electric gantry cranes in the container stacks are good examples of the green use of current infrastructure. About 5,200 terminals have been equipped with shore power capabilities, and 2,300 rubber-tired container gantry cranes have been switched to electricity.

PORT GOVERNANCE AND FINANCE

China’s port development combines commercialization with the economic, social, and environmental policy goals of the central government. Although policies initially prioritized economic development and internationalization, they were later expanded to include innovation, environmental sustainability, reductions in the negative externalities of port activities for host cities, and narrower socioeconomic disparities between coastal and inland regions. Various initiatives were launched to reduce emissions from port operations and ships in port. The environmental efficiency of Chinese ports increased as a result, but the potential for further improvement is great.

In China, the state-owned enterprise (SOE) model ensured that the central government retained just enough control over port development. Although many private foreign companies act as service providers, the port enterprises are SOEs and, consistent with China’s overall institutional structure, follow the broad direction set out in national five-year plans. For instance, the SOEs increasingly invest in innovation and technology and have developed ambitious environmental initiatives, in line with the current five-year plan. Some countries may find China’s governance context inapplicable but may still learn useful lessons despite the differences.

State ownership of port enterprises in China has ensured that the actions and investments of those enterprises supported development strategies within and beyond the port gate, and that they were consistent with broad macroeconomic and social policies. Such coordination is not necessarily dependent on who owns and operates port assets, but, in a relatively weak legal and contractual environment, coordination within the state sector was arguably easier than it would have been under a public-private partnership approach. Port SOEs have also