China’s Engagement in Africa and a New Development of International Maritime Logistics

China’s Engagement in Africa and a
New Development of International
Maritime Logistics
MPA Visiting Professor Paul T-W Lee
Professor(客座敎授), Dept. of Business Administration
Soochow University, Taipei, Taiwan
paultwlee2030@gmail.com; paultwlee@scu.edu.tw
MPA Visiting Professor Public Lecture
NTU, 22 August 2013

I. Overview of growing China’s engagements in the world in
S-S trade routes
II. What is the impact of the China’s engagement on
international maritime logistics in association with trade
liberalisation, focusing on an emerging maritime logistics
in the southern hemisphere?
III. How to convert trade value into trade volume in container
boxes, reflecting liberalisation trade
• Lee & Lee’s Novel Approach (2008~present)
• Empirical Tests with South-South Trades
IV. Implications and discussions
V. Concluding remarks
VI. Q & A Time 2
My Presentation Outlines

3
Growing China’s Engagements in Trade Liberalization:
 China’s international trade volumes mostly relies on maritime
transport in South (North)-South trading routes.
 Since growing China’s engagement in trade liberalization and free
trade agreements would cause a structural change in commodity
trade, the derived demand for shipping services change, and
international logistics structure and services accordingly.
 Why COSCO active in S-S trade?
 Understanding of legacy of former state-owned shipping company (eg
Soviet Shipping, NYK during 1st and 2nd WW, COSCO)
 Maritime economists (industry) are hungry for accurate and reliable
forecasts of Container TEUs), NOT in trade value.
 Lee & Lee’s Approach (2009~2011): A method to convert trade value
into trade volume with help of GTAP model and UN COMTRADE
database
Research Motivation & Background

4
My Presentation aims
 First, to draw implications on China’s engagement in trade
liberalization from the perspective of international maritime
logistics;
 Second, to discuss about how to maximise the effect of China’s
engagement in South (North)-South trade by developing
international maritime logistics system in Africa; and
 Third, to explore where is the best place to develop international
maritime logistic system in Sub-Saharan Region connecting
South America.

Overview of Growing China’s
Engagement in the world

ChinAfrica (= China + Africa)
 Long history between China and Africa: 1421-
2008
 Exploitation and import of natural resources
 Increasing export and import trade volume
 China as a locomotive to develop African
economy
 China as a “new” lender
 In 2006, China pledged to double its aid
to Africa during the period of 2006 to
2009.
 Number of Chinese leaders’ visiting in
Africa, including New President of China,
Mr Xi Jin-Ping in March 2013.
Michel Beuret and Serge Michel (2008)
China’s Engagement in the Globalised Economy (1/8)
6

Chindia is a portmanteau word that refers to
China and India together in general.
 Coinned by Indian Member of Parliament Jairam
Ramesh.
 Chindia: How China and India Are
Revolutionizing Global Business by Pete
Engardio (2006)
 Understanding the combined impacts of the two
giants (Engardio’s speech, March 17, 2007)
 “The Exponential Power of ‘Chindia’”:
 “New joint ventures between Indian IT service
firms and their Chinese counterparts hint at the
formidable bilateral economy” (by Partha Iyengar
and Jamie Popkin, Business Week, Sept. 6, 2007)
Pete Engardio (ed) (2006)
7

Chindia Rising:
 How China and India will benefit the global
economy?
 Why the Rise of China and India is
Inevitable?
 The rise of Chindia is not only inevitable, but it
will be beneficial to the world economy.
 Consequently, the global integration of China
and India will impact global supply chain.
Jagdish N Sheth (2008)
8

CHINNOVATION:
How Chinese Innovators are
Changing the World.
Yinglan Tan (2011)
9

10
 Freer South-South trade has been recognized as a vital engine
for the globalised economy:
 to cause a substantial change in the move of cargoes, consequently changing
the derived demand for shipping and container port services, and
international logistics services.
 ChinAfrica and Chindia has accelerated China’s engagement
in South (North)-South trades:
 The IBSA (India, Brazil and South Africa) trade liberalization
draws considerable attention since:
 The three countries, IBSA, are respectively the leading economies in
the continents of East Asia, South America, and Africa
 The formation of IBSA is emblematic of new geography of
international trade
China’s Engagement and IBSA (5/8)

11
 Recent development of BRICS (Brazil, Russia, India, China
and South Africa), in particular with China’s impact on the
African Continent, is expected to further China’s engagement
in several fields such as:
China’s Engagement and BRICS (6/8)
 establishment of manufacturing centre
within and outside free trade zone,
 container hub port development and
mega-carrier services in Africa,
 Inland transportation networking
(corridors) connecting sea ports,
 transshipment networking, and
 logistics distribution centre for Sub-
Saharan Region.
26-27 March, 2013 in Durban
South Africa

Exports to China
US$ 26.0 billions
5.5 million tons
Imports from China
US$ 4.7 millions
0.9 million tons
Imports from other countries
US$ 6.6 billions
1.5 million tons
Exports to other countries
-US$ 13.4 billions; -1.8 mil.
tons
China’s Engagement and ECFA (7/8)
 Economic integration agreement
between Taiwan and mainland
China, known as “Economic
Cooperation Framework
Agreement” (ECFA) in 2010.
 Core Elements of ECFA
 Liberalization in Trade and
Investment
 Early Harvest : referred to as an
earlier or immediate tariff
concession on some particular
products and services at the initial
stage of trade liberalization.
 Promotion of tree direct-links
between Taiwan and China
12
Source: Lee et al (2011), Maritime Policy
Management, 38(2)

13
 International politics and international trade
 China’s scheme of Free Trade Agreements with ASEAN
 P-TPT led by USA
 FTA between Korea and China, China and Japan, Japan and
Korea.
 Growing influence in Myanmar among USA, China, and
Japan
 Sea power in East China Sea
China’s Engagement in ASEAN (8/8)

Shipping in China by T-W Lee et al
(2003)
 How has China’s state-owned shipping
lines, COSCO, been restructured
owing to her government’s open
policy?
 How has China’s container logistics
routes been transformed to meet
increasing cargo flow on South
(North)-South trade routes?
 Understanding of legacy of former
state-owned shipping line to promote
and support economic and foreign
policies of ChinaLee, T-W et al (2003)
Restructuring of State-Owned Shipping Lines in China, COSCO
14

 How has Chinese logistics service providers been coping with
South-South trade developments, i.e., between China and Africa and
South America?
 Where is the best location of logistics distribution centre to serve
the Sub-Saharan region, trying to relay service between Africa and
South America with Asian economies?
 Looking ahead, what are the likely challenges & responses China is
facing?
 To accelerate and promote the Economic and Strategic Rise of
China in Africa and S. America
 To keep sustainability of historical legacy of China in Africa
 What about Singapore’s position?
 What about S. Africa’s port policy?
 What bout shipping liners’ business options?
Questions raised by China’s engagement in South (North) -
South Trade
15

Methodology:
How to convert trade value into trade
volume (container TEUs)
(Lee & Lee’s Approach)

17
Literature on Forecasting Seaborne Cargo Volumes (1/2)
 From the methodological viewpoint, the forecast tools in the
literature include, among others, econometrics with
regression analysis and time series technique/data; neural
networks; port input-output model; and etc
 Fung (2001): a vector error correction model to forecast container
throughput in Hong Kong.
 Veenstra & Haralambides (2001): multivariate autoregressive time
series model to produce long-term predictions.
 Seabrooke et al. (2003): a regression analysis to predict cargo growth.
 Zhang et al. (2005): regression analysis to examine the contribution
of regional economic growth to container throughput in the Pearl
River Delta region of China.
 Mak & Yang (2007): approximate least squares support vector
machines to forecast the monthly container throughput in Hong Kong.

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 Fung (2002):
 a three-player oligopoly model to analyze the strategic interaction
among the terminals and midstream in Hong Kong as well as the
terminals in Singapore.
 The game-theoretical model is then estimated with structural error-
correction method and is used to forecast the container throughput.
 Zachcial (2002): a modal split model is developed and estimated with
linear regression technique.
 Regarding studies adopting predictive tools rather than econometric analysis
 Lam et al. (2004): forecast 37 types of freight movements and cargo
throughput of Hong Kong port using neural networks approach.
 Moon (1995): port input-output model as a predictive tool to project the
growth of maritime traffic and to provide information for future planning
of ports, taking a Korean case.
Literature on Forecasting Seaborne Cargo Volumes (2/2)

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 The above literature survey shows that the cargo flow forecasts are
mainly based on econometric analysis with historic time series data
and business-as-usual assumption.
 None attempts to forecast the variations in cargo volumes
resulting from asymmetric shocks of tariff removal caused by
trade liberalization.
 As far as the increasing container trade is concerned, the forecasts
should also provide the details about routes (origin/destination) of
commodity trade flows for a better planning on maritime transport
capacity and international logistics services and integrated
transportation, including dry port, dedicated berth capacity, logistics
distribution centre.
 To authors’ best knowledge, few forecasts have been conducted with
these features. This fact stimulates Lee & Lee’s approach to fill such
a gap in the literature.
Lee & Lee’s first attempt to fill the research gap

20
A Comparison between Current Literature and Lee & Lee’s Approach
Item
Literature on forecasting
maritime cargo volumes
Literature on economy-
wide impacts of trade
liberalization
Lee & Lee’s Approach
Methodologies
Econometrics; neural
networks; port input-output
model
Mainly CGE models
A global CGE model,
GTAP, and external
computation based on
the official statistics
Features of
the studies
 Particular attention is paid
to the forecasts of cargo
volumes under the
business-as-usual
circumstance, assuming
unchanged structure of
commodity trade.
 The asymmetric structural
changes in commodity
trade arising from trade
liberalization and
economy-wide adjustment
are usually neglected.
 Special focus is
placed on the
economy-wide
impacts of the
reduction in trade
barriers.
 The results are
usually provided in
value terms, thus
give limited
understandings on
the variations in
cargo volumes.
 Lee & Lee’s
approach fills the
gap between the two
literatures by
extending the CGE
applications to
forecast variations in
cargo flows due to
trade liberalization
and by providing an
alternative predicting
methodology in the
field of
transportation
planning.
Source: TC Lee and Paul TW Lee (2012)

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 Although the CGE or GTAP models are widely adopted to
analyze the economic impacts of trade liberalization, the
application in maritime shipping studies concerning trade
liberalization is sparse.
 Lee & Lee’s approach makes a quantitative contribution by
integrating the GTAP model with the worldwide known, publicly
available United Nations COMTRADE database.
 Lee & Lee’s approach highlights the significance of high tariff rates in
determining the South-South trade geography, and sheds light on the
new trade geography and container port and shipping developments in
the south hemisphere after the IBSA trade liberalization. (on-going
research on BRICS and ASEAN region)
Contribution of Lee & Lee’s Approach
21

Introduction of Global Trade Analysis Project (GTAP)
 Major Features:
 Computable (Applied) General Equilibrium Model
 Multi-regions & Multi-sectors Incorporated
 Main Assumptions:
 Perfectly competitive markets, i.e., price taking behavior for all
economic agents
 Constant-returns-to-scale technology
 Demand for primary factors are determined based on Constant
Elasticity of Substitution (CES) functions
 Leontief functions are specified to determine the demands for
intermediate inputs and the primary factor composite
 “Armington Approach” (Armington, 1969) is adopted to determine
the optimal mix of imported and domestic goods
22

23
 This paper adopts the latest version (version 7
with 2004 as the base year) of the GTAP
database, which has
 113 regions
 5 primary factors (land, capital, nature resource, unskilled
labour, and skilled labour)
 57 production sectors (agricultural and food processing
sectors (sectors 1-25), the manufacturing sectors (sectors
26-42) and the service sectors (sectors 43-57))
GTAP Version 7 Database

24
 Global Trade Analysis Project (GTAP) model is adopted to forecast the
impacts of the IBSA on cargo value flows
 a global computable general equilibrium (CGE) model widely used in the
negotiation of trade liberalization under World Trade Organization (WTO) or
other free trade agreements (FTAs)
 Then a scientific approach is developed to convert the
estimated cargo value flows into volume flows
Methodology: Integration of GTAP and UN Database
IBSA Tariff Removal Simulation
by the GTAP model
Statistics on Trade Value and Weights from UN
COMTRADE Database
Mapping Concordance
(HS Codes)
GTAP Forecasts on Trade Value Flows Calibrated Conversion Factors
Volume Forecasts and Validation

Analysis on Trade Flows using
Global Trade Analysis Project
Model

26
Flow Chart of Analysis on Trade Flows
Data Aggregation
Simulation Design
Trade Flows Analysis
Identification of Relevant
Trading Countries (Routes)
S-2
T/S Cargoes from
Sub-Saharan Africa
S-3
Interlining Cargoes
to/from Brazil and Rest
of South America
S-1
Gateway Cargoes
of South Africa

Converting the GTAP Trade
Value Flows into Volume Flows
Lee & Lee’s Approach (2009~)

- Index -
 Projecting Trade Value Flows with GTAP Model
 UNCOMTRADE Data for the Conversion of Trade
Value Flows into Volume Flows
 Mappings between UNCOMTRADE Data and GTAP
Data
 Assumptions made for Conversion for gateway, T/S
and interlining cargoes
 Comparison of Historical data with Converted data in
2001 and 2004
 Projected Trade Volume Flows in 2015 and 2020
Converting the GTAP Trade Value Flows into Volume Flows
28

Projecting Trade Value Flows with GTAP Model
 Three Scenarios:
1. Gateway Cargoes (Import & Export) of South Africa
2. Transshipment Cargoes from Sub-Saharan Africa
3. Interlining Cargoes (from/to China, India, Rest of Asia, Oceania) to/from Brazil & Rest of
South America
 Evaluating the change in trade value flows by shocking
the expected changes in macro economic variables,
comprising the growth of real GDP, capital, and labour
 Providing the changes in trade value flows not only in
terms of total value, but also in terms of detailed
components (i.e., by commodity types & by routes)
 Details and results of trade value flows are provided in
final report.
 The focus of this presentation will be on the conversion
of trade value flows into trade volume flows.
29

Converting Trade Value Flows into Volume Flows
United Nations COMTRADE Data
used in the Conversion of Trade
Value into Trade Volume

 UN COMTRADE Data
United Nations Commodity Trade Statistics Database
http://comtrade.un.org/
 Use UN COMTRADE Data in 2001 and 2004 (i.e., the
base year of GTAP V6 and V7 Database) for Conversion
 Both Trade Value (USD) and Weight (Kg) are provided
in UN COMTRADE data.
UNCOMTRADE Data for the Conversion
31

 Commodities in UN COMTRADE Data are classified
based on HS codes (Harmonized System codes) or
SITC codes (Standard International Trade
Classification codes)
 Mappings b/w commodities in HS2002 codes and
GTAP sectors are available on the GTAP website
https://www.gtap.agecon.purdue.edu/resources/res_dis
play.asp?RecordID=1916
Mappings between UNCOMTRADE Data and GTAP Data
32

Mappings b/w HS Code and GTAP Sectors
HS HS02 Description GTAP GTAP Description
10110 Live purebred breeding horses and asses 9 Bovine cattle, sheep and goats,
10190 Live horses other than purebred breeding horses 9 Bovine cattle, sheep and goats,
10210 Live purebred bovine breeding animals 9 Bovine cattle, sheep and goats,
10290 Cows imported specially for dairy purposes 9 Bovine cattle, sheep and goats,
10310 Live purebred breeding swine 10 Animal products nec
10391 Live swine, other than purebred breeding swine, weighing less than 50 kg 10 Animal products nec
10392 Live swine, other than purebred breeding swine, weighing 50 kg or more 10 Animal products nec
10410 Live sheep 9 Bovine cattle, sheep and goats,
10420 Live goats 9 Bovine cattle, sheep and goats,
10511 Live chickens weighing not over 185 g each 10 Animal products nec
10512 Live turkeys weighing not more than over 185 g each 10 Animal products nec
10519 Live ducks, geese and guineas, weighing not more than 185 g each 10 Animal products nec
… … … …
970400
Postage or revenue stamps, stamp-postmarks, first-day covers, postal
stationery, and the like, used or unused, other than heading 4907
41 Machinery and equipment nec
970500
Collections and collectors' pieces of zoological, botanical, mineralogical,
anatomical, historical, archaeological etc. interest
42 Manufactures nec
970600 Antiques of an age exceeding one hundred years 42 Manufactures nec
33

34
Flow Chart for Historic Data Conversion in South Africa and
Sub-Saharan Africa (2001 and 2004)
Trade Value (USD) and
Weight (kg) in 2004 from
UN COMTRADE Data
TEU before considering
Containerisation Ratio (CR)
TEU after considering
TEU including
Empty Container
Total Estimated TEU
Average Weight
ton/Million USD
Average Weight
ton/TEU
Containerisation
Ratio of the total
export and import
Empty Container %
of the total
export and import
Transshipment
Container Cargo
% of the total
throughout
Additional Assumptions
for Converting Projected T
rade Value Data
Converting Weight into TEU
Considering Containerisation Ratio
Considering Empty Container
Considering T/S Container Cargo
Assumptions

35
Flow Chart for Projected Data Conversion in South Africa and
Sub-Saharan Africa (2015 and 2020)
TEU before considering
TEU after considering
TEU including
Empty Container
Total Estimated TEU
Average Weight
ton/TEU
Containerisation
Ratio of the total
export and import
Empty Container
% of the total
export and import
Transshipment
Container Cargo
% of the total
throughout
Converting Weight into TEU
Considering Containerisation Ratio
Considering Empty Container
Considering T/S Container Cargo
Projected Trade Value Flows
(USD) in 2015 and 2020 Average Weight
ton/Million USD
Based on UN
COMTRADE DataProjected Trade
Weight Flows (kg)
in 2015 and 2020
Converting Value into Weight
Assumptions

 Four Major Assumptions:
 Average Weight ton/TEU
Source: Data from Korean Custom Office and Stellenbosch Report
 Containerisation Ratio (CR) of the total export and import
Source: UNCTAD Maritime Report
 Empty Container % of the total export and import
Source: South Africa NPA Data
 Transshipment Container Cargo % of the total throughput (T/S
Container Cargo Volume)
Source: South Africa NPA Data
 Additional Assumption made for Converting Projected Trade Value
Flows into Volume Flows
 Average Weight ton/Million USD
Source: UN COMTRADE Data
Assumptions for Conversion in South Africa and Sub-Saharan Africa
36

My Joint Publications related to the Conversion
37
1. Lee, T-C, Wu, C-H, and Lee, Paul T-W (2011b), “Impacts of the ECFA
on Seaborne Trade Volume and Policy Development for Shipping and
Port Industry in Taiwan”, Maritime Policy and Management, 38(2), pp.
1-21.
2. Lee, T-C and Lee, Paul T-W (2012), “South-South Trade
Liberalisation and Shipping Geography: A Case Study on India,
Brazil, and South Africa”, International Journal of Shipping and
Transport Logistic, 4(4), pp.323-338.
3. Lee, T-C, Lee, Paul T-W, and Chen, T. (2012), “Economic Impact
Analysis of Port Development on the South African Economy”, South
African Journal of Economics, 80(2), pp.228-245.
4. Paul T-W Lee, Tsung-Chen Lee and Tzu-Han Yang (2013), “Korea-
ASEAN Free Trade Agreement: The Implications on Seaborne
Trade Volume and Maritime Logistics Policy Development in
Korea,” Journal of International Logistics and Trade, 11(1), pp.43-65.

38
South Africa: Change in Exports of Containerisable General
Commodities from 2001 to 2004 (Million USD in 2004 (%))
SSA: Sub-Saharan Africa; NEU: North Europe; ASIA: The Asian Countries
MDE: Middle East; NAM: North America; SAM: South America; MET: Mediterranean
NAM

39
South Africa: Change in Imports of Containerisable General
SSA: Sub-Saharan Africa; NEU: North Europe; ASIA: The Asian Countries
MDE: Middle East; NAM: North America; SAM: South America; MET: Mediterranean

40
Sub-Saharan Africa: Change in Exports of Containerisable General
Commodities from 2001 to 2004 (Million USD in 2004 (%)
ZAF: South Africa; NAM: North America; SAM: South America
EU: Europe; NCA: Non-China Asia; CHN: China

41
China: Change in Exports of Containerisable General
ZAF: South Africa; BRZ: Brazil; IND: India; RASIA: Rest of Asia;
OCE: Oceania; RSA: Rest of South America 1,194(130%)
Arrows in pink correspond to interlining cargoes and
those in cyan correspond to non-interlining cargoes.

42
China: Change in Imports of Containerisable General
ZAF: South Africa; BRZ: Brazil; IND: India; RASIA: Rest of Asia
OCE: Oceania; RSA: Rest of South America
-57(-19%)
Arrows in pink correspond to interlining cargoes
and those in cyan correspond to non-interlining
cargoes.

IBSA Case
Outputs excerpted from
Lee, T-C and Lee, Paul T-W (2012), “South-South Trade
Liberalisation and Shipping Geography: A Case Study
on India, Brazil, and South Africa”, International
Journal of Shipping and Transport Logistic, 4(4),
pp.323-338.
Analysis on Trade Flows in the V7 Database

IBSA Trade Liberalisation
The IBSA trade liberalization draws considerable attention,
given the facts that:
• India, Brazil, and South Africa are the leading economies
in the continents of South Asia, South America, and Africa,
respectively.
• IBSA cooperation acts as an excellent role model for the
South-South cooperation.
• IBSA countries have become influential players in
international trade, and the formation of IBSA is
emblematic of new geography of international trade.

Regional Aggregation of GTAP Version 7 Database
45
Regional description Comprising the GTAP version 7 countries/regions
India India
Brazil Brazil
South Africa South Africa
China China
Rest of
Hong Kong; Japan; Korea; Taiwan; Rest of East Asia; Cambodia; Indonesia; Lao People's Democratic
Republic; Myanmar; Malaysia; Philippines; Singapore; Thailand; Viet Nam; Rest of Southeast Asia;
Bangladesh; Pakistan; Sri Lanka; Rest of South Asia
Oceania Australia; New Zealand
Rest of
Argentina; Bolivia; Chile; Colombia; Ecuador; Paraguay; Peru; Uruguay; Venezuela; Rest of South
America
Rest of the World
Rest of Oceania; Canada; United States of America; Mexico; Rest of North America; Costa Rica;
Guatemala; Nicaragua; Panama; Rest of Central America; Caribbean; Austria; Belgium; Cyprus; Czech
Republic; Denmark; Estonia; Finland; France; Germany; Greece; Hungary; Ireland; Italy; Latvia;
Lithuania; Luxembourg; Malta; Netherlands; Poland; Portugal; Slovakia; Slovenia; Spain; Sweden;
United Kingdom; Switzerland; Norway; Rest of EFTA; Albania; Bulgaria; Belarus; Croatia; Romania;
Russian Federation; Ukraine; Rest of Eastern Europe; Rest of Europe; Kazakhstan; Kyrgyztan; Rest of
Former Soviet Union; Armenia; Azerbaijan; Georgia; Iran Islamic Republic of; Turkey; Rest of Western
Asia; Egypt; Morocco; Tunisia; Rest of North Africa; Nigeria; Senegal; Rest of Western Africa; Central
Africa; South Central Africa; Ethiopia; Madagascar; Malawi; Mauritius; Mozambique; Tanzania;
Uganda; Zambia; Zimbabwe; Rest of Eastern Africa; Botswana; Rest of South African Customs

Sectoral Aggregation of GTAP Version 7 Database
Note : Lee and Lee (2011a) develops a scenario of removing trade barriers among India, Brazil, and South Africa (IBSA).
* : Crude oil is not traded among the IBSA countries.
46
Sectoral descriptions Comprising the GTAP version 7 sectors
Tariff rates (%)
India –
Brazil
Brazil -
India
Brazil -
South
Africa
South
Africa -
Brazil
India –
South
Africa
South
Africa -
India
Water transport water transport
Containerizable general
commodities
gas; textiles; wearing apparel; leather products; wood
products; paper products, publishing; transport equipment
nec; electronic equipment; machinery and equipment nec;
manufactures nec
15.69 14.61 5.26 13.61 15.27 10.16
Containerizable
Agriculture
commodities
vegetables, fruit, nuts; oil seeds; sugar cane, sugar beet;
plant-based fibers; crops nec; bovine cattle, sheep and goats,
horses; animal products nec; raw milk; wool, silk-worm
cocoons; fishing; bovine meat products; meat products nec;
vegetable oils and fats; dairy products; processed rice; food
products nec; beverages and tobacco products
10.66 108.17 14.30 12.59 3.16 44.77
Major bulk paddy rice; wheat; cereal grains nec; coal; minerals nec 3.63 6.54 0.05 0.77 0.25 16.55
Break bulk and minor
bulk
forestry; sugar; mineral products nec; ferrous metals; metals
nec; metal products
13.45 83.62 8.59 8.57 5.55 15.80
Liquid petroleum, coal products; chemical, rubber, plastic products 5.53 15.31 4.06 8.08 2.96 14.96
Crude oil* oil — — — — — —
Automobile motor vehicles and parts 16.59 58.78 19.10 17.13 18.69 16.20
Others
electricity; gas manufacture, distribution; water;
construction; trade; transport nec; air transport;
communications; financial services nec; insurance; business
services nec; recreational and other services; public
administration, defense, education, health; dwellings

Routes/Commodities Containerizable general Containerizable
agriculture
Major bulk Break bulk and minor
bulk
Liquid Automobile
Trade within IBSA countries
1. India-Brazil 118 (361)** 8 (7)* 1 (0) 20 (37)** 419 (184) 4 (6)**
2. Brazil-India 104 (165)** 361 (5,419)** 95 (14) 219 (7,831)** 77 (89)** 25 (239)**
3. Brazil-South Africa 291 (76) 288 (176)* 32 (-2) 98 (51)* 85 (14) 305 (387)**
4. South Africa-Brazil 43 (89)** 6 (5)* 47 (4) 120 (102)* 74 (44)* 16 (25)**
5. India-South Africa 251 (678)** 77 (14) 6 (0) 126 (76)* 213 (47) 51 (84)**
6. South Africa-India 128 (150)** 13 (28)** 42 (30)* 1,747 (1,205)* 244 (305)** 10 (11)**
Trade between IBSA countries and other countries/regions
7. India-China 783 (70) 184 (11) 2,958 (89) 614 (61) 688 (7) 10 (1)
8. India-Rest of Asia 6,240 (562) 2,868 (143) 1,204 (36) 2,085 (209) 4,527 (45) 327 (16)
9. India-Oceania 523 (47) 97 (4) 20 (0) 140 (13) 113 (1) 21 (1)
10. India-Rest of South America 268 (29) 10 (1) 3 (0) 37 (5) 278 (8) 49 (4)
11. China-India 4,072 (-122) 73 (-33) 265 (-5) 712 (-263) 1,463 (-29) 24 (-3)
12. Rest of Asia-India 9,102 (-182) 2,023 (-910) 398 (-8) 2,335 (-864) 3,154 (-63) 834 (-92)
13. Oceania-India 265 (-3) 211 (-95) 1,075 (-11) 3,241 (-1,167) 80 (-1) 7 (-1)
14. Rest of South America-India 56 (-2) 422 (-194) 487 (-10) 34 (-13) 29 (-1) 1 (0)
15. Brazil-China 1,089 (-196) 2,353 (-235) 2,449 (-147) 522 (-78) 202 (-16) 161 (-18)
16. Brazil-Rest of Asia 1,304 (-235) 3,410 (-409) 1,802 (-126) 2,063 (-309) 495 (-45) 245 (-27)
17. Brazil-Oceania 181 (-34) 132 (-17) 13 (-1) 49 (-7) 64 (-6) 75 (-8)
18. Brazil-Rest of South America 5,326 (-905) 1,202 (-132) 257 (-15) 1,714 (-223) 3,100 (-248) 3,496 (-280)
19. China-Brazil 2,206 (110) 37 (3) 27 (2) 191 (15) 939 (19) 18 (1)
20. Rest of Asia-Brazil 4,652 (279) 131 (10) 35 (2) 276 (22) 1,181 (24) 620 (31)
21. Oceania-Brazil 46 (3) 13 (1) 326 (23) 50 (5) 28 (1) 16 (1)
22. Rest of South America-Brazil 1,457 (58) 1,236 (99) 1,473 (88) 931 (65) 2,517 (25) 941 (38)
23. South Africa-China 238 (-10) 31 (0) 772 (-8) 566 (-23) 144 (-3) 35 (0)
24. South Africa-Rest of Asia 1,017 (-41) 574 (-11) 692 (-7) 4,579 (-183) 475 (-10) 989 (-10)
25. South Africa-Oceania 338 (-14) 64 (-1) 15 (0) 158 (-6) 112 (-2) 408 (-4)
26. South Africa-Rest of South America 64 (-1) 15 (0) 23 (0) 76 (-1) 50 (-1) 4 (0)
27. China-South Africa 2,116 (-21) 72 (-2) 23 (0) 256 (0) 286 (0) 57 (-2)
28. Rest of Asia-South Africa 3,202 (-32) 433 (-13) 11 (0) 423 (0) 824 (0) 2,080 (-83)
29. Oceania-South Africa 222 (0) 108 (-2) 118 (2) 616 (6) 78 (1) 53 (-2)
30. Rest of South America-South Africa 48 (-1) 357 (-11) 154 (2) 34 (0) 26 (0) 35 (-2)
47
Numerical Results: Volume Flows among IBSA

Source: TC Lee and Paul TW Lee (2011a) 48
Routes/Commodities Containerizable general Containerizable agriculture Break bulk and minor bulk Sum
1. India-Brazil 2,134 (6,530)** 1,506 (1,265)* 2,103 (3,911)** 5,742 (11,705)**
2. Brazil-India 4,195 (6,670)** 77,114 (1,157,475)** 29,383 (1,050,718)** 110,691 (2,214,863)**
3. Brazil-South Africa 8,851 (2,301) 57,456 (35,048)* 17,142 (8,914)* 83,449 (46,263)*
4. South Africa-Brazil 2,001 (4,123)** 838 (721)* 7,340 (6,239)* 10,180 (11,083)**
5. India-South Africa 3,891 (10,504)** 14,639 (2,635) 17,997 (10,798)* 36,526 (23,937)*
6. South Africa-India 6,896 (8,068)** 2,024 (4,332)** 101,544 (70,066)* 110,465 (82,466)*
Trade between IBSA countries and other countries/regions
7. India-China 13,800 (1,242) 36,851 (2,211) 79,871 (7,987) 130,523 (11,440)
8. India-Rest of 113,880 (10,249) 470,193 (23,510) 278,869 (27,887) 862,941 (61,646)
9. India-Oceania 8,368 (753) 13,224 (529) 16,403 (1,476) 37,996 (2,758)
10. India-Rest of 5,829 (641) 1,895 (114) 4,949 (643) 12,673 (1,398)
11. China-India 75,671 (-2,270) 11,291 (-5,081) 53,697 (-19,868) 140,659 (-27,219)
12. Rest of Asia-India 183,178 (-3,664) 752,668 (-338,701) 222,506 (-82,327) 1,158,352 (-424,692)
13. Oceania-India 4,660 (-47) 42,517 (-19,132) 100,471 (-36,170) 147,647 (-55,349)
14. Rest of South America-India 2,851 (-114) 86,955 (-40,000) 2,362 (-874) 92,168 (-40,987)
15. Brazil-China 35,438 (-6,379) 493,346 (-49,335) 84,651 (-12,698) 613,435 (-68,411)
16. Brazil-Rest of 43,249 (-7,785) 591,067 (-70,928) 342,114 (-51,317) 976,430 (-130,030)
17. Brazil-Oceania 5,596 (-1,063) 19,235 (-2,501) 7,313 (-1,097) 32,145 (-4,661)
18. Brazil-Rest of 195,287 (-33,199) 239,064 (-26,297) 284,238 (-36,951) 718,589 (-96,447)
19. China-Brazil 24,818 (1,241) 5,131 (410) 14,986 (1,199) 44,934 (2,850)
20. Rest of Asia-Brazil 59,507 (3,570) 46,643 (3,731) 27,140 (2,171) 133,290 (9,473)
21. Oceania-Brazil 472 (33) 2,412 (217) 1,702 (170) 4,585 (420)
22. Rest of South America-Brazil 63,501 (2,540) 234,909 (18,793) 67,498 (4,725) 365,907 (26,058)
23. South Africa-China 10,968 (-439) 4,705 (-47) 48,747 (-1,950) 64,420 (-2,436)
24. South Africa-Rest of 47,502 (-1,900) 66,265 (-1,325) 411,156 (-16,446) 524,924 (-19,672)
25. South Africa-Oceania 15,027 (-601) 5,621 (-112) 11,567 (-463) 32,215 (-1,176)
26. South Africa-Rest of 3,213 (-64) 2,115 (-21) 6,824 (-68) 12,153 (-154)
27. China-South Africa 18,339 (-183) 10,120 (-304) 29,739 (0) 58,197 (-487)
28. Rest of Asia-South 32,687 (-327) 154,990 (-4,650) 57,546 (0) 245,223 (-4,977)
29. Oceania- 1,702 (0) 20,238 (-405) 44,198 (442) 66,138 (37)
30. Rest of South America-South 1,968 (-39) 68,524 (-2,056) 3,747 (-37) 74,239 (-2,133)
(Units: TEUs; numbers in ( ) are the changes in volume flows caused by IBSA liberalization)

49
Note: 1. On the numerical results of value flows among IBSA, see TC Lee and Paul TW Lee (2011a)
2. * indicates a change exceeding 50%; ** indicates a change exceeding 100%
Routes/Commodities Containerizable
general
Containerizable
agriculture
Break bulk and
minor bulk Sum
1. India-Brazil 2,134 (6,530)** 1,506 (1,265)* 2,103 (3,911)** 5,742 (11,705)**
2. Brazil-India 4,195 (6,670)** 77,114 (1,157,475)** 29,383 (1,050,718)** 110,691 (2,214,863)**
3. Brazil-South Africa 8,851 (2,301) 57,456 (35,048)* 17,142 (8,914)* 83,449 (46,263)*
4. South Africa-Brazil 2,001 (4,123)** 838 (721)* 7,340 (6,239)* 10,180 (11,083)**
5. India-South Africa 3,891
(10,504)*
*
14,639 (2,635) 17,997 (10,798)* 36,526 (23,937)*
6. South Africa-India 6,896 (8,068)** 2,024 (4,332)** 101,544 (70,066)* 110,465 (82,466)*
(Units: TEUs; numbers in ( ) are the changes in volume flows caused by IBSA liberalization)

50
 IBSA trade liberalization will increase the loaded
container shipping in the six IBSA trade routes by
2.39 million TEUs
 In terms of routes:
 A significant increase in the exports from Brazil to India
(2.21 million TEUs)
 In terms of commodity types:
 the increase in containers mostly comes from
containerizable agriculture commodities (1.20 million
TEUs) and break bulk and minor bulk (1.15 million
TEUs)

Numerical Results: Volume Flows between China and
IBSA Countries
51
Routes/Commodities
Containerizable
general
Containerizable
agriculture
Break bulk and
minor bulk
Sum
7. India-China 13,800 (1,242) 36,851 (2,211) 79,871 (7,987) 130,523 (11,440)
11. China-India 75,671 (-2,270) 11,291 (-5,081) 53,697 (-19,868) 140,659 (-27,219)
15. Brazil-China 35,438 (-6,379) 493,346 (-49,335) 84,651 (-12,698) 613,435 (-68,411)
19. China-Brazil 24,818 (1,241) 5,131 (410) 14,986 (1,199) 44,934 (2,850)
23. South Africa-China 10,968 (-439) 4,705 (-47) 48,747 (-1,950) 64,420 (-2,436)
27. China-South Africa 18,339 (-183) 10,120 (-304) 29,739 (0) 58,197 (-487)
Note: On the numerical results of value flows among IBSA, see TC Lee and Paul TW Lee (2012).
Numbers in ( ) are the changes in volume flows caused by IBSA liberalization.
(Units: TEUs)

Summary (1) : South Africa’s Case
 Gateway Cargoes of South Africa
 Our estimate of gateway cargoes in South Africa is 1.68 million
TEUs in 2001 and 2.12 million TEUs in 2004. The actual (historical)
gateway cargoes in 2004 is 2.62 million TEUs.
 Note that the estimate is sensitive to the major assumptions such as
average weight, CR, % of empty and % of T/S cargoes. Given the fact
that our major assumptions rely highly on real world data, the
estimate is not significantly different from the historic data.
 Our projected gateway cargoes for South Africa in 2015 and 2020 are
respectively 5.49 million TEUs and 7.54 million TEUs. These figures
are of no significant difference from those in Stellenbosch report
version 14 (5.31 million TEUs in 2015 and 7.30 million TEUs in
2020, respectively).
52

 Transshipment Cargoes from Sub-Saharan Africa
 Our estimates of transshipment cargoes from Sub-Saharan
Africa represent the maximum volume of transshipment.
 The projected volumes of trade (export + import), empty
containers and T/S cargoes are 15.78 million TEUs in 2015,
and 21.43 million TEUs in 2020, respectively.
53

 Interlining Cargoes
 Our estimates of interlining cargoes represent the
maximum volume, i.e., the trade flows between S.
America and Asia, and between S. America and Middle
east and India that might pass through South Africa.
 The estimates are 7.81 million TEUs in 2015, and 11.09
million TEUs in 2020, respectively.
 These figures are of no significant difference from those
of interlining estimates by FC (6.52 million TEUs in 2015
and 10.04 million TEUs in 2020, respectively).
54

International Maritime Logistics
and
China’s Engagement in South (North)-
South Trade

56
 Maritime Logistics, as the primary means of transporting parts and finished goods
(viz., outbound logistics) on a global scale, has recently attracted increasing attention
from academics. (by DW Song and Paul TW Lee (2009), International Journal of
Logistics: Research and Applications, Vol.12, No.2. )
 Maritime Logistics, however, is a term which is not easy to define, and its precise
definition, scopes and roles within the global supply chain network are yet to be
established.
 Logistics and Supply Chain Management generally relates to the co-ordinated
management of the various functions responsible for the flow of materials from
suppliers into an organisation through a number of operations within the organisation,
and then reaching out to its customers. Hence, it consists of a series of activities along
the network concerned, which in many cases will involve maritime activities.
 There has been some convergence of Maritime Transport and Maritime Logistics,
and this can be attributed to the physical integration of transport modes driven by
containerisation and the evolving demands of end-users that require the application of
logistics concepts to the use of these modes and the achievement of logistics goals.
Defining Maritime Logistics in the Global Supply Chain

57
 Studies on Logistics and Supply Chain tends to pay little
attention to maritime transport aspects in the international
trade.
 Maritime Logistics covers not only flows of cargo,
information, idea, and money on the sea trading
routes, but also maritime and inland transport and
logistics activities among international trading
partners, applying logistics and SCM concepts to the
use of intermodal transport and the achievement of
seamless and efficient logistics goals. (Paul T-W Lee.
2011)
Defining Maritime Logistics in the Global Supply Chain

China – India Route:
: China (Shanghai, Ningbo) - Hong Kong - Singapore - India - Sri
Lanka – Malaysia - Thailand , taking 21 days, as of June 2011
YEAR 2011: Chindia Route
India
Source: http://www.coscon.com/home.screen 58

China’s Extra Asian Maritime Logistics
 COSCO Container Shipping is a key player to expand and promote maritime
logistics and catalyst to promote South-South trade liberalization thru IBSA
and BRICS mechanism.
 Development of China’s Extra Asian Maritime Logistics Network has
contributed to promote China’s engagement in South (North) – South trade,
where COSCO has been transforming from cosseted national player to global
champion. [See Shipping in China by TW Lee et al (2003)]
 Expansion of Maritime Logistics Network since 1990
 China – Singapore – West Africa
 China – Singapore – South Africa - West Africa
 China – Singapore – West Africa – South Africa – South America
59

YEAR 1990: China – West Africa Route (Skipping S. Africa)
1. Shanghai & Hong Kong are dominant international hubs bounding for Europe
and Intra-Asia and N. America.
2. China-West Africa route without calling at Durban and Cape Town in S Africa
Skipping
South Africa
60
West
Africa
China
© Rimmer and Comtois, 2005; modified by the author (2011)
N. America
Oceania
Europe

YEAR 2000/2010: China – South Africa Route
Container liner service between China and South Africa, taking 26 – 33 days from
Shanghai to Durban/Cape Town in South Africa, as of June 2011.
South
Africa
Singapore
© Rimmer and Comtois, 2005; modified by the author (2011)
61
Europe
N. America
Oceania

YEAR 2011: China – South America Route
Emerging new service line between China – Singapore – South America
: 3 ports in S. America, taking 29 to 35 days from Shanghai to S. America,
as of June 2011.
Brazil
Source: http://www.coscon.com/home.screen
62

 International Maritime Logistics in Africa are organized along key trade and
transport corridors originating from the ports of entry and exit to the
hinterland.
 The map shows a couple of corridors from the seaport Walvis Bay to
neighboring countries by connecting corridors.
The various transport corridors are
characterized as follows:
 geography (entry ports and landlocked areas
served)
 corridor institutional structure and the degree
of competition between corridors and
transport modes
 shipping connections
 regulatory regime and market structure
Understanding of Maritime Logistics in Africa
63

Corridors
West Africa Central Africa East Africa Southern Africa
Main Ports of
entry
Abidjan,
Tema,
Lome,
Cotonou,
Dakar
Douala Mombasa,
Dar-es-Salaam
Durban, Ngqura
Maputo, Beira,
Dar-es-Salaam
Landlocked
countries served
Mali, Burkina,
Niger
Chad,
Central
African
Republic
Uganda, Rwanda,
Burundi,
Democratic
Republic of
Congo (east)
Botswana,
Malawi,
Zambia,
Zimbabwe,
Democratic
Republic of
Congo (south)
Four Key Transport Corridors in Africa: Ports & Countries
64

65
Fundamental Impediments to Maritime Logistics in Africa
 Extremely high port congestion in West African ports
 Poor inland transportation network (rail and road)
 low productivity of the trucking industry in Africa, notably
because of infrastructure constraints; low levels of competition
between service providers; and weak infrastructure
 Under-developed Port MIS (cargo tracking system ) and RFID
system
 Bureaucratic customs office
 Low port efficiency compared to major Asian container ports
 Under-developed short sea shipping network in collaboration with
and logistics providers and major liners
Consequently,
 highly logistics cost (time and freight cost) + surcharge
 Higher doing business cost

 Asia-South Africa (SA) trade routes are the most important
ones, totaling 48% of the whole market share in SA;
 There are seven major trade routes in SA. Maersk is
dominant in five major routes; another two, the
Mediterranean–SA and the East/West-SA ones, are
dominated by MSC shipping line;
 Among the seven trade routes in SA, Asia-SA is a
relatively competitive one;
Key Findings about South Africa’s Maritime Logistics
 The sea freight rates charged in Greater China-SA trade routes are located in
the ‘low’ level, which represent the sea freight rates charged are similar to the
East-West trade routes;
 Around 85% of the space of the containership has been assigned to ports in
Greater China; fewer supply of space of containership in South East ports, as
a result, the sea freight rates in SE port range are maintained at higher level.
 South Africa is seen as a hub for traffic emanating from and destined for
Europe, Asia, South America and the east and west coast of Africa.
Source: Paul T-W et al (2008), Port Economics Study on South Africa, Transnet Port
Terminals, South Africa. 66

Policy Implications from China’s
Perspective and
China’s Challenges and Responses

68
Policy Implications from China’s Engagement Perspective (1/3)
68
 Trade liberalisation contributes to increasing maritime cargo flows.
This has been supported by a series of maritime cargo flows analysis
employing GTAP model + Lee & Lee approach.
 China would be benefitted from her engagements in liberalization of
South (North) – South trade, laying down a platform to promote
merchandise exchange in the three countries, even though the South
Africa and Brazil are far away from China.
 The Exponential Power of ChinAfrica and Chindia will generate
more cargo movements on the South (North)- South Trades.
 Thus there will be increasing more demand for deep sea shipping and
international logistics services.
 Accordingly, opportunities are envisaged to create COSCO’s
shipping lines to further increase the vessel size deployed for
transshipment and relay activities on the route of India and South
Africa and Brazil.

6969
 As for a container hub port as
well as logistics distribution
centre in South Africa, e.g.
Ngqura, China (COSCO &
Logistics Providers) needs
 to develop short sea shipping
network to provide feeder service
for East and West Africa;
 to secure integrated inland
transportation network (corridors) in
association with dry ports; and
 to consider strategic options of
maritime logistics, relaying services
between S Africa and S. America
Ngqura port in South Africa
Ngqura
Large
deepsea
call
Feeders
SA’s Load Centre
Feeders
Feeders
Inland
distribution
Ngqura
Large
deepsea
call
Feeders
SA’s Load Centre
Feeders
Feeders
Inland
distribution

70
China’s Strategic Options:
Towards a new South America Route?
= typical nodes for transhipment / relay / interlining
Shanghai
Santos
Routing alternatives on the trade between China and Brazil
Asia – Europe/Med
Typical vessel size =
5000-13000 TEU
Europe/Med – South-America
Vessel size =
2000-3500 TEU
Asia – Latin-America
3000-5000 TEU
Latin America - ECSA
1500-4500 TEU
Southern Africa - ECSA
1700-5500 TEU
Asia - Southern Africa
Average vessel size =
2500 TEU
Maximum vessel size =
5500 TEU
= 11270 nm, sailing time = 22 days (at 21 knots)
= 13590 nm, sailing time = 27 days (at 21 knots), Suez Canal transit
= 13130 nm, sailing time = 26 days (at 21 knots), Panama Canal transit
Note: distances via Dataloy Distance Tables
The hub potential of the South-African container port system: example of routing
alternatives between China and Brazil (sailing time excludes port time and canal
transit time)
Source: Flynn Consulting (2011)

China’s Strategic Options: Competition with Major Shipping Liners -
SAEC
West Africa
Oceania
East Africa
India/Pakistan
SE Asia
East Asia
Northern Europe: interlining of Europe-Far East services and North Europe – West Africa/South America services
Main interlining ports: Antwerp (mainly MSC), Le Havre (mainly CMA CGM), Rotterdam
Straits of Gibraltar: interlining of Europe-Far East services and North Europe – West Africa/South America services
Main interlining ports: Algeciras (mainly Maersk), Valencia (mainly MSC), Tanger Med, Sines (relation Portugal-Brazil only)
Middle East: interlining of Europe-Far East services and Middle East – East Africa services
Main interlining ports: Salalah (mainly Maersk), Dubai, Jeddah
INDIA
SA
BRAZIL
Source: Flynn Consulting (2011)
CHINA
71
[Existing interlining regions (RED) which will compete with relay/interlining
business via SA (BLUE) - Competing interlining regions indicated in red circles]

72
 Asia’s increasing involvement in Africa with China’s engagement with trade
liberalization on South (north)-South trade encourages.
 South Africa to develop a container-port hub as a transport node as well as to
capture transshipment cargoes and/or interlining cargoes on this route.
72
 Port competition: Ngqura
(Durban) vs Maputo
 Port Choice in Sub-
Saharan region for
distribution centre of
Sub-Saharan region and
relaying cargo for South
America?
Durban
Ngqura
Maputo
Port Louis
Cape Town
South Africa
Gauteng

73
 Port attractiveness index: Application on African ports (Caschili and
Medda, 2013 IAME Conference, Marseilles)
 Three sets of determinants (endogenous, exogenous and subjective) that
influence attractiveness.
 Top ten positions in Africa out of 41 container ports in 23 African countries for
average 2006-2010 (Port Said, Durban(2), Damietta, Tangier, Alexandria, Cape
Town(6), El Dekheila, Port Elizabeth(8), Ngqura(9), Sokhna). Red ports in SA.
 Nacala port in Mozambique jumped from 32nd position in 2006 to 8th in 2010:
recent improvements of her multimodal transport infrastructure, due to her
strategic position (corridor to landlocked neighbours such as Zimbabwe, Zambia
and Malawi), reduction of transport costs, and logistics efficiency.
 South Africa has been providing container port capacity and free
trade zones nearby the ports, e.g. Ngqura.
 Short sea shipping network and inland transportation in the Sub-
Sahara region are easily to be connected in southern part of Africa.
 S. African ports are well located in to capture T/S cargoes, and
interlining and gate way cargoes.
Which ports are most attractive in Africa?
73

CONCLUDING REMARKS:
 China’s Challenges and Responses
 Singapore’s Challenges and Responses
 Future Agenda for Promoting
International Maritime Logistics
in South – South Trade

 Optimizing ship size deploying on South (North)-South
tra`ding routes with short sea shipping network development
for Sub-Saharan region
 Seeking China’s own dedicated container berth in South
Africa, as a gateway and transshipment port for Sub-Saharan
region and a relaying port for South America
 Finding dry ports in Africa in connection with inland transport
system (corridors) to minimize transportation costs
 Integrated and intermodal transportation system in Africa in
collaboration with COSCO’s overseas schedules and logistics
providers
 COSCO’s Logistics integrating trucking, warehousing &
barges, i.e. establishing International Maritime Logistics
system.
China’s Challenges and Responses (1/3)
75

76
 Investment in marine terminals, container depots & service
companies in Africa for South (North) – South trade
 Establishment Logistic Distribution Centre in South Africa for
Sub-Saharan region, e.g. South Africa, and to relay cargoes to
S. America
 Integration of a container port in South Africa in alliance with
shipping alliance members
 Developing feeder North-South network services in West and
East Africa and Transshipment Hub for relaying cargoes to and
from South America responding to forecasting containerizable
and containerized cargo flow [see a series of papers applying
the Lee and Lee’s approach]

77
 To make S-S trade route profitable, interplay between extra-
Asian and intra-Asian traffic is required to capture more
cargoes for the route.
 COSCO needs to co-operate with major shipping lines to
expand frequencies to South (North)-South trade routes.
(recent movement: One shipping alliance is to start services for
S. Africa from September 2013.)
 Logistics Providers in China need to establish logistics network
in S. Africa, including dry ports, to serve the Sub-Saharan
region.

78
Structural Changes in Major Container Ports
Notes: Containerisation International (several issues). Numbers in parentheses indicate million container throughputs in
twenty-foot equivalent container unit (TEU). Lee and Flynn (2013), Transport Reviews.
Los Angeles
Long Beach
New York/
New Jersey
Hamburg
Bremers/Bremerhaven
Rotterdam
Giola Tauro
Dubai
Antwerp
Felixstowe
Tokyo
Hong Kong
Singapore
Tanjung Priok
Busan
Shanghai
20
15
10
5
TEUs (millions)
Tianjin
Cingdao
Guangzhou
Laem
Chabang
Port Klang
Tanjung Pelepas
Kachsiung
Ningbo
Year N. America Europe Asia Others Total
1970 7 14 2 2 25
1980 7 6 8 4 25
1990 6 6 11 2 25
2000 3 6 14 2 25
2010 3(19m) 5(32m) 15(211m) 2(16m) 25(278m)

79
 Where a container hub port in Sub-Sharan region?
 Location of logistics distribution centre for Sub-Saharan Region
 International maritime logistics network for Sub-Saharan
Region
 Establishment of hub-and-spoke system in Sub-Sahara region
and S. America
 Lowering doing business costs in Africa
Future Agenda for Promoting International Maritime Logistics
in South – South Trade
79

Singapore’s Challenges and Responses
80
 Singapore’s Hinterland: “The World”
 Impact of China’s engagement on S-S trade on Singapore
maritime industry?
 Singapore’s reaction to China’s engagement in S-S trade?

Thank you for your attention!
Professor Paul T-W Lee
Department of Business Administration
Soochow University, Taipei, Taiwan
Email: paultwlee2030@gmail.com; paultwlee@scu.edu.tw
Q & A

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