Despite having limitation of modern equipment, country’s key seaport, Chittagong port, secured top position in terms of efficiency among 69 ports of 17 countries in Asia, says a recent study.
The report — Benchmarking the Efficiency of Asian Container Ports — says Chittagong port is using existing old and new equipment at its optimum level, and the study found Chittagong port as the most efficient port.
The researchers reached this conclusion after evaluating data of five years and the study carried out in 2010. The study findings were published in African Journal of Business Management (Vol 5(4), pp 1397-1407) on February 18 this year. According to the study findings, 12 ports have been ranked for ‘super efficiency’ with Bangladesh topping the list.
The ports of Zamboanga and General Santos in Philippines were in the second and third position respectively in the super efficiency category.
Xiamen of China, Sihanoukville of Cambodia, Davao of Philippines, Yantian of China, Lianyungang of China, PSA Int of Singapore, Tianjin of China, Mumbai of India, and Guangzhou of China were among the other 12 ports in the category.
The remaining 47 ports are both scale and technically inefficient.
Given the current phase of globalisation and competition, port performance is of major importance for port competitiveness, the report said.
The study analysed the technical efficiency and scale efficiency of Asian container ports by means of DEA. The analysis shows that the main source of overall technical inefficiency in Asian container ports is due to pure technical inefficiencies rather than scale inefficiencies.
The report suggests that port managers must improve their management practices to favour efficient ways and to meet customer requirements. Ports must enhance their handling activities and computerise container terminal operations.
The next step would then be to improve their scale efficiencies. About 48 per cent of the ports are exhibiting increasing returns to scale. These ports should increase their scale of operations via expansion or internal growth and building alliances amongst shipping organisations.
About 35 per cent of the container ports exhibit decreasing returns to scale. These ports can decrease their scale of operations by giving up some of the terminal assets and operational functions to other specialised private entities via concessions and leaseholds.
This will allow efficient handling and transit of containers as well as help promote intra-port competition between multiple service providers within a port which can lead to higher efficiency gains.
Strategies that impact on the volume and nature of trade is to become a hub, seek for World Trade Organisation membership, provide dedicated container terminals, seek cooperation strategies between ports and improve on their transport infrastructure to link with the hinterland.
The analysis also revealed that Chinese container ports enjoy a clear lead in the Asian region in terms of containers handled and they are very competitive. Size and ownership structure are not determinants of efficiency level in container ports.
In the last decade, the shipping industry and the global seaborne trade have witnessed a rapid growth due to globalisation of the world economy, boom in international trade and borderless investments.
As competition among international ports has intensified, the evaluation of port operational efficiency has become increasingly important to enable individual ports to reflect on its current status quo and understand their strengths and weaknesses in the competitive environment.
The study was conducted to investigate the technical and scale efficiency of major container ports in the Asian region.
It employed the non-parametric Data Envelopment Analysis Technique to benchmark and evaluated the operating performance of 69 major Asian container ports to generate efficiency ranking.
The results indicate that the average technical efficiency of the Asian container ports is 48.4 per cent.
The overall technical inefficiency in Asian container ports is due to pure technical inefficiency rather than scale inefficiency.
The results of the study can indicate possible improvements in port management and operational planning at local and national levels.
-With New Age input
