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Investments in container terminals: public private partnerships

Author

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  • Wiegmans, Bart W.

    (Vrije Universiteit Amsterdam, Faculteit der Economische Wetenschappen en Econometrie (Free University Amsterdam, Faculty of Economics Sciences, Business Administration and Economitrics)

  • Ubbels, B.
  • Rietveld, P.

Abstract

The desire to create a more competitive, market based transport system has led to the involvement of the private sector in infrastructure investments. A private financing of transport infrastructure is one of the fìelds where this trend can be recognised. However, there are also distinct aspects, which make it unattractive to invest in transport infrastructure for private parties. This paper will elucidate the characteristics of investments in infrastructure in general, with the aim to clarify the hesitation under private investors. In addition, one specific category of infrastructure investments, viz. container terminals, will be discussed here as an exception. Container terminals are mostly financed with involvement of private parties. From a comparative study between ’normal’ investments in infrastructure and investments in container terminal infrastructure, we will argue that terminals have several features, which lead to a lower risk for private parties, in particular restricted competition in the terminal market and protected monopoly profits, labour productivity gains and fall in unit costs, and a light regulatory framework. Because of these characteristics public private partnerships occur rather often and seem to be attractive. However, without government support it is still not realistic to attract private investment in the terminal market.

Suggested Citation

  • Wiegmans, Bart W. & Ubbels, B. & Rietveld, P., 2002. "Investments in container terminals: public private partnerships," Serie Research Memoranda 0003, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    • Handle: RePEc:vua:wpaper:2002-3
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    Citations

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    Cited by:

    1. Musso, Enrico & Ferrari, Claudio & Benacchio, Marco, 2006. "Port Investment: Profitability, Economic Impact and Financing," Research in Transportation Economics, Elsevier, vol. 16(1), pages 171-218, January.
    2. Yang, Dong & Li, Lu & Notteboom, Theo, 2022. "Chinese investment in overseas container terminals: The role of investor attributes in achieving a higher port competitiveness," Transport Policy, Elsevier, vol. 118(C), pages 112-122.
    3. Roy, D. & Gupta, A. & Parhi, S. & de Koster, M.B.M., 2014. "Optimal Stack Layout in a Sea Container Terminal with Automated Lifting Vehicles," ERIM Report Series Research in Management ERS-2014-012-LIS, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    4. Parola, Francesco & Notteboom, Theo & Satta, Giovanni & Rodrigue, Jean-Paul, 2013. "Analysis of factors underlying foreign entry strategies of terminal operators in container ports," Journal of Transport Geography, Elsevier, vol. 33(C), pages 72-84.
    5. Francesca Medda & Qianwen Liu, 2013. "Determinants and strategies for the development of container terminals," Journal of Productivity Analysis, Springer, vol. 40(1), pages 83-98, August.
    6. Francesco Parola & Giovanni Satta & Simone Caschili, 2014. "Unveiling co-operative networks and 'hidden families' in the container port industry," Maritime Policy & Management, Taylor & Francis Journals, vol. 41(4), pages 384-404, July.
    7. Baccelli, Oliviero & Percoco, M. & Tedeschi, A., 2008. "Port Authorities as cluster managers: the case of the Ligurian ports," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 39, pages 44-58.
    8. Roy, D. & de Koster, M.B.M., 2014. "Modeling and Design of Container Terminal Operations," ERIM Report Series Research in Management ERS-2014-008-LIS, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    9. Debjit Roy & René De Koster & René Bekker, 2020. "Modeling and Design of Container Terminal Operations," Operations Research, INFORMS, vol. 68(3), pages 686-715, May.
    10. Feng, Hongxiang & Grifoll, Manel & Yang, Zhongzhen & Zheng, Pengjun, 2021. "Latest challenges to ports in public-private partnership: Case of Dandong Port (China)'s bankruptcy," Transport Policy, Elsevier, vol. 110(C), pages 293-305.
    11. Sergi Saurí & Francesc Robusté, 2012. "Promoting Incentives: Performance Improvement in Container Port Terminals," Transportation Science, INFORMS, vol. 46(2), pages 233-246, May.
    12. Xiao, Zengqi & Lam, Jasmine Siu Lee, 2020. "The impact of institutional conditions on willingness to take contractual risk in port public-private partnerships of developing countries," Transportation Research Part A: Policy and Practice, Elsevier, vol. 133(C), pages 12-26.
    13. Panayides, Photis M. & Parola, Francesco & Lam, Jasmine Siu Lee, 2015. "The effect of institutional factors on public–private partnership success in ports," Transportation Research Part A: Policy and Practice, Elsevier, vol. 71(C), pages 110-127.
    14. Gharehgozli, A.H. & Roy, D. & de Koster, M.B.M., 2014. "Sea Container Terminals," ERIM Report Series Research in Management ERS-2014-009-LIS, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.

    More about this item

    JEL classification:

    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning

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