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Purpose: The purpose of assignment one is to help you to develop a better understanding of the role, functions, and characteristics of a global port city of international trade.


Requirements:

While reading and attempting to review this piece of research work, you could have the opportunity to learn and discuss the role and management of global seaports from an international trade perspective as well as to establish the relationships between the theories that you will learn during lectures with current practices in the industry.
In your assignment, you are required to select one of the global port cities in the world and then undertake an in-depth analysis of comparative and competitive advantages. Examples of these port cities of global significance include:
Singapore
Shanghai
Shenzhen
Busan
Rotterdam
Hong Kong
Antwerp
Hamburg
Los Angeles
Dubai
Tokyo
Ningbo-Zhoushan
Guangzhou
Mumbai
Ho Chi Minh City
In this assignment, you are required to demonstrate a comprehensive knowledge regarding global port cities, particularly but not limited to the following topics.

- Comparative and competitive advantages,
- Operational challenges,
- Recommendations/ Business strategies

Location of the Port City

Shanghai is a port city found in China, the port has rapidly grown and undergone great modernization since the year 1949. Shanghai is now one of the major commercial centers in China since the year 1978 when the government of China shifted to economic policies that were more open. The port’s ambition is to transform into the largest shipping, financial, economic and trade center worldwide. The port’s status as an international city is unchallenged, in addition, the port’s infrastructural and urban architectural expansion is unmatched and this gives the port a greater expansion opportunity (Lau 2015). The vastness of the port makes it capable of handling large number of cargo per year, which in return increases the company’s revenue. The port has created employments opportunities to the residence hence there is improved living standards to the people of China. In addition, the port has also made large contribution to the growth of China’s domestic economy (Lau 2015). However, there are many other challenges that raise questions in regard to education, freedom of communication, social policies and the availability of clean water for drinking. Shanghai has been a significant port city since the time it was founded and in the mid-19th century, the port city progressed to a major exchange port. With the European’s influx, France in particular, the port was influenced and the name ‘Paris of the East’ was given to the port city of Shanghai (Krupar 2007).
Comparative and competitive advantages

In the year 1995, China’s central government decided to develop the Shanghai International Shipping Hub (SISH) which consisted of the main port at the Shanghai Municipality as the center, and the other ports being; Zhejiang and Jiangsu as the wings. In January 1996, the SISH was initiated officially, and it is a cluster of ports including the Jiangyin port, Yangzhou port, Zhenjiang port and many other ports (O’Connor, 2010). The ports in the SISH have rapidly developed as a result of the hinterland, which is the Yangtze River Delta that is growing rapidly. In the year 2010, data from China’s Communication Ministry indicated that the Delta controlled a total amount of 837 million tons of cargo from foreign countries (Lee, Song and Ducruet, 2008). The containers in the area are transported mainly through the Ningbo port and Shanghai port, therefore, the ports’ competitiveness is studied (Merk and Notteboom 2015). SISH’s direct hinterland, the Yangtze River Delta, is the main commercial region in China and one of the largest financial area worldwide. In the year 2010, the GDP of the Delta was about 6.99 Trillion Yuan and the GDP accounted for about 17.6% of the whole economy of China.

Cargo transportation with the containers has become more popular, this is because transportation with the containers is more fast, safe and convenient. More than 90% of the foreign exchange logistics volume relies on the Shanghai ports where transportation is mainly via the containers. The Yangtze service system tends to converge in various features with the historical improvement outline of the internal container services within the Rhine basin (Ducruet and Notteboom 2012). The government of China has restructured the transportation space of the Shanghai port-city; the restructuring is done in reflection to the rapid growth of the container port. The growth is mainly a result of the economic globalization of the world. Since the year 1993, the general plan and layout of the Shanghai port-city have been drawn, for the purpose of improving the container port, the special structuring gives the port-city an advantage over other port-cities, such as the Singapore port-city, to transport the containers efficiently (Laxe, Seoane and Montes 2012).

The Spatial Assembly of the Container Port

In comparison to other ports, the Shanghai global port-city has been structured to be large enough to avoid the cases of port congestion. Increase in port congestion y 10% results to an increase in the costs of the marine transportation y 0.7% and therefore, there is a reduction in the volumes of the exported goods (Wang and Ducruet, 2012). Inefficiency in trucking services result in an increased period of standing at the dockside and this leads to infrequency in the shipping services. The Shanghai global port-city, in comparison to the other port-cities (such as the port of Buenos), is large enough and the services offered at the port are efficient to avoid the problems of shipping irregularity. The Shanghai port has become greatly competitive globally due to the aspect of the port’s efficiency (Wan, Zhang and Li 2018).
Lower marine transportation costs

The Shanghai port-city has reduced its transportation costs to gain more customers than its competitors. The costs of marine transportation have a share of the value of the traded products, therefore, the customers tend to use the most affordable port for the transportation purpose. The Shanghai port-city has fair transportation costs in comparison to the other global port-cities, therefore, the port is preferred by most customers (Merk 2013).

Shanghai’s authorities say that more than half of the 2500 rivers and lakes close to the port-city are polluted heavily. In accordance to the census of the city water institute, from 2010-2012, 53% of the water is dangerous for uptake and only 3% of the water is clean for household intake and fish farming (Axel 2011). The deprived rating of Shanghai; which is the financial and shipping hub near the East China Sea and the Yangtze River is a negative sign of the uphill battle in China for clean water resources. The rates of cancer in Shanghai and China have risen steadily partly due to the increased intake and use of polluted water.

China’s education system is the largest worldwide with about 260 million scholars and over 15 million trainers in almost 514 000 schools. Shanghai port-city, being the country’s major economic zone, requires a lot of manpower, most of the students tend to drop out of the schools to be employed at the port. This educational challenge has forced the state to run the educational system of the country, the government at the county level governs the schools’ education. The Education Ministry steers the reforms of education through the administrative means, policies, laws, and plans. The strategies are set in response to increased rates of school dropouts in the Shanghai region.

Shanghai which is a rapid growing port-city, tends to face a challenge of increased cases of insecurity. The city is a metropolis with a population that is rapidly growing, a city like Shanghai is bound to have an increase in the rate of insecurity; the insecurity cases include rape cases, murder cases and theft cases (Axel 2011).
There are many other challenges faced by Shanghai and they include; meeting the severe competition experienced by the automobile industry, upgrading the structure of the industry. Developing management mechanisms that are market-oriented, retiring the current sunset industries and restructuring the composition of ownership are also the challenges that the port faces.

Shanghai is developing both long-term and mid-term goals for development in order to face the challenges as well as the opportunities that are likely to unfold in the 21st century (Campanella 2012). The goals of the port city are: to develop the port into the largest shipping, financial, economic and trading center worldwide and to recognize the city’s socialist modern global metropolis vision by the year 2020. The central government’s policies that favor the ports enhancement provide a great boost towards Shanghai’s economic growth.


The major elements of the city’s strategic plan include: Building industries to enhance economic growth; develop iron, steel and petrochemical industries; renovate the traditional industries. Encouraging the creation of metropolitan industries for the purpose of creating job opportunities and nurturing high and new technology industries were also the elements of the strategy.

Conclusion

The Shanghai global port city is the major economic center in China that is rapidly growing mainly due to its locality near the Yangtze River Delta. The port is working tirelessly towards being one of the largest port-cities worldwide, its good infrastructure and urban architectural structures have given Shanghai an upper hand towards attaining the economic breakthrough by the year 2020 (Krupar 2007). The port has advanced greatly, however, there are various challenges that the faced by the city, for instance, the scarcity of clean drinking water, the government, therefore, has developed strategies for the purpose of eliminating the challenges

References

Axel, B.N. ed., 2011. Environmental Impacts of International Shipping The Role of Ports: The Role of Ports (Vol. 2011). OECD Publishing.
Campanella, T.J., 2012. The concrete dragon: China's urban revolution and what it means for the world. Chronicle Books.
Ducruet, C. and Notteboom, T., 2012. The worldwide maritime network of container shipping: spatial structure and regional dynamics. Global networks, 12(3), pp.395-423.


Krupar, S.R., 2007. Shanghaiing the future. University of California, Berkeley.
Lau, G.L., 2015. Sustainable High-rise Construction in Shanghai, Tecnico Lisboa
Laxe, F.G., Seoane, M.J.F. and Montes, C.P., 2012. Maritime degree, centrality and vulnerability: port hierarchies and emerging areas in containerized transport (2008–2010). Journal of Transport Geography, 24, pp.33-44.


Lee, S.W., Song, D.W. and Ducruet, C., 2008. A tale of Asia’s world ports: the spatial evolution in global hub port cities. Geoforum, 39(1), pp.372-385.
Merk, O., 2013. The competitiveness of global port-cities: synthesis report.


Merk, O. and Notteboom, T., 2015. Port hinterland connectivity. International Transport Forum Discussion Paper.
O’Connor, K., 2010. Global city regions and the location of logistics activity. Journal of Transport Geography, 18(3), pp.354-362.

Wan, Y., Zhang, A. and Li, K.X., 2018. Port competition with accessibility and congestion: a theoretical framework and literature review on empirical studies. Maritime Policy & Management, 45(2), pp.239-259.
Wang, C. and Ducruet, C., 2012. New port development and global city making: emergence of the Shanghai–Yangshan multilayered gateway hub. Journal of Transport Geography, 25, pp.58-69.

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