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A rivalry at sea

A rivalry at sea

As established ports, both Singapore and Hong Kong will have to fend off younger, lower-cost and more eager competitors that will work harder to grab market share. Information technology is critical in helping them retain the top two slots in the global league table of busiest container ports.

In the last few decades, the ports of Hong Kong and Singapore have dominated the top two slots in the global league table of busiest container ports. Except for three years (1990, 1991 and 1998, when Singapore briefly held first place), Hong Kong has been the busiest container port between 1987 and 2004. In 2005, the Lion City overtook Hong Kong in terms of containers handled and has held first place ever since.

Technology certainly helped Singapore clinch first place, though Hong Kong's current third position -- Shanghai has overtaken it as well -- is probably more the result of greater local competition. Hong Kong is no longer the sole gateway to China, especially with the rise of the ports of Shanghai and Shenzhen.

The ability of container ships to unload cargo and take on new loads quickly, relies very much on the technology used by the port authorities and terminal operators. The terminal operators handle the actual loading and unloading of ships. They use technology to help them plan the whole process, how to load and unload cargo, how to transport the cargo to and from container yards, and even how and where to stack the containers in an optimum fashion. Port authorities, on the other hand, rely on technology to monitor the safety of the waters and handle the paperwork, so that ships can enter and leave the respective ports quickly and easily, without compromising the safety of other port users.

Both ports rely on similar technologies to process ships and cargo quickly. Where both differ, is in the speed of adoption of new technology. Singapore regularly leads the way in terms of deploying new technology, possibly driven by Hong Kong's long stretch of unchallenged supremacy.

Speeding up the administration and information flow is one of the easiest and fastest ways to improve efficiency. Both Singapore and Hong Kong offer electronic port clearance to enable ships to enter or leave their respective waters quickly.

Online submission

Singapore's Maritime and Port Authority developed and launched Marinet in April 1999. Marinet allowed the shipping community to submit statutory declarations for vessel arrivals and departures, dangerous goods, and information on bunker operations to the MPA online. Processing and validation are done online and approvals are granted immediately within a single transaction. Marinet also facilitates the online application of licences and permits issued by the MPA. Some of these services include applications for a temporary harbor craft permit. It also acts as a one-stop facility for shipping agents to order pilotage and towage services from any of the licensed tug operators servicing the port. Marinet currently has almost 4,000 users from some 1,200 companies, according to Toh Ah Cheong, director (Technology) at the MPA.

Hong Kong's marine department introduced its equivalent, the electronic business system, in December 2003, with the second phase of the system rolled out earlier this year. Under the first phase, a ship's agent could file the paperwork electronically using a web-based interface. Once approval was given, someone would have to go down to the counter to make payment.

The rollout of the second phase, in April this year, means everything is now done electronically, including payment. And apart from the marine department, paperwork that has to be filed with the immigration department and the department of health, can also be filed through EBS.

"The whole process now takes less than 10 minutes," notes senior marine officer Michael Chau, the head of the IT management section of the marine department. The long-term aim is to make EBS the shipping portal for Hong Kong's shipping community, he says.

Dangerous goods documentation

Related to the EBS is electronic submission of the dangerous goods manifest. Introduced in 2006, this allows registered shipping companies to submit their dangerous good manifest in XML format to the Marine Department, using a web interface. This was the first time that systems from private enterprise, namely the shipping industry, talked directly to the government's system, according to Chau.

The entire system is automated now, even on the Marine Department's end. If the paperwork is in order, the system can issue the approval immediately. Previously, everything had to be manually approved, which could take up to half a day. The success of this system was that in 2007, 95 per cent of dangerous good manifest submissions were done online.

Apart from using technology to speed up the information flow, IT is also used to improve the monitoring of ships in the port. In the old days, ports relied on people using radio and telescopes. Today, both Singapore and Hong Kong use advanced radar and communications systems to monitor ships in their waters.

The Marine Department's Vessel Traffic Centre (VTC) uses a vessel traffic system to track all vessels in Hong Kong waters. This system involves nine radars, covering all major shipping areas and their approaches. Together with a fully integrated radio and communication system and a database information system, VTC provides full surveillance of all navigable waters in Hong Kong.

Set up in 1989, the Vessel Traffic System is a vast improvement over the traditional method used by the port's old communication center. That relied on VHF radio and a hand-held telescope for the watch-keepers to check a vessel's movement. This limited the monitoring as it depended on the vessels being within the line of sight.

Vessel monitoring in Singapore is also very advanced. The MPA has two Port Operations Control Centres (POCCs) that monitor traffic in the eastern and western part of Singapore's port waters, as well as traffic in the Singapore Strait. Both centers use a Vessel Traffic Information System (VTIS) which serve as full back-up for each other. The system uses 11 radars and can monitor up to 5,000 vessels in real-time. Each POCC has 13 VTIS work stations to monitor different sectors of the port's waters and the Singapore Strait.

In addition, the MPA has implemented an initiative to automatically track and monitor small powered harbor and pleasure craft in Singapore's port waters. The harbor craft transponder system (HARTS) was rolled out in early 2007. All such craft will need to carry a transponder on them that is turned on when they are in Singapore waters. The system allows real time data from the transponder such as vessel identity, position, speed, course and other information are transmitted to a shore-based system via the wireless communication link. There is also a panic button to alert the control center if there is a security threat or emergency. The system was developed by MPA, and jointly implemented by the MPA, the Police Coast Guard and Republic of Singapore Navy.|

Containing containers

While the port authorities handle the big picture, it is the terminal operators who must ensure that ships are able to load and unload quickly; no easy task because of the volume of work, the need for speed and safety, and the need to manage the inventory of containers, cranes and trucks in the container yard. Terminal operators rely heavily on technology to help them do this.

Singapore has two terminal operators, but PSA Singapore Terminals is, by far, the largest. In 2007, PSA Singapore Terminals, with its four terminals, alone handled 27.1 TEU (Twenty-foot Equivalent Units) out of the 27.9 TEU handled by the entire port. PSA used to be the port authority, but no longer. Since 1996, PSA Singapore Terminals has become a terminal operator, while the MPA has become the regulator.

Hong Kong, on the other hand, has five different terminal operators--Hongkong International Terminals (HIT), Modern Terminals, COSCO Pacific, Dubai Port International Terminals and Asia Container Terminals. Of the five operators, HIT is the largest. Situated in the Kwai Chung container port area of Hong Kong, HIT operates 12 berths and another two through its joint venture with COSCO Pacific. In 2006, HIT and COSCO-HIT handled a combined throughput of 8.235 million TEU. HIT is the flagship operation of the Hutchison Port Holdings Group.

Both PSA Singapore Terminals and HIT rely heavily on IT. Both have adopted electronic data interchange (EDI) systems to allow paperwork to be filed faster. In addition, both rely on IT systems to help them unload, transport, store and subsequently reload ships.

PSA Singapore Terminals has two major systems, Portnet and CITOS, that help them be efficient. Developed in 1984, Portnet is an electronic paperless platform for shipping lines, hauliers, freight forwarders and local government agencies, including Customs, to better communicate with the port and with each other. Shipping companies can use it to relay cargo instructions, order berth and pilot services, documentation, enquiry and real-time tracking.

Since it was originally developed it has evolved considerably. In 1999, it moved to the Internet. Portnet has recently been redeveloped to support multiple party collaboration and integration, workflow automation and proactive exception management. Today, Portnet services 8,000 users and processes some 100 million transactions annually.

Enterprise Resource Planning

The other major system is CITOS, which stands for Computer Integrated Terminal Operations System. First developed in 1988, CITOS is an enterprise resource planning system that coordinates and integrates all assets, from prime movers, to yard cranes and quay cranes to containers and drivers.

CITOS also helps to plan the stacking of containers. When the information is keyed into the system through Portnet, CITOS automatically generates ship stowage plans and yard layout plans based on factors, such as ship stability (for stowage planning), weight of container, destination of container, size and special requirements.

This allows PSA to maximize land use and optimize retrieval, to track the location of each container and maximize resource productivity through planning ahead, says Chua Kee Thiam, the head of information technology at PSA Singapore Terminals.

HIT in Hong Kong has a similar system, which it first rolled out in 1996 as the productivity plus program (3P). The program decides how to route trucks in the yard, where to store containers, how many quay cranes, trucks and yard cranes to deploy and scheduling of trucks for container pickup.

Using 3P, HIT saved about US$100 million a year. HIT replaced 3P with a new system, the next generation terminal management system, or nGen, in 2005. This new system controls the entire terminal operations, from ship and yard planning to gate operations, vessel operations and interactions, yard configuration and performance and overall operations monitoring.

HIT and sister company Yantian International Container Terminals in Shenzhen, worked with HP to develop nGen. The terminal management system was launched in 2003 at Yantian before it was rolled out at HIT. The system will be use at other ports owned by Hutchinson.

Control tower systems

Apart from nGen, HIT relies on other systems to ensure efficiency. The control tower, for example, uses the Operations Monitoring System (OMS) and the Ship Planning System (Guider).

OMS is a tool used to help HIT staff visualize terminal operations and container stacking. Graphic representations of the terminal's operations enable staff to easily understand the situation. The system has an overview that covers the entire container yard down to details of individual containers. The system can predict yard congestion so operators can take pre-emptive action.

The process of loading and unloading vessels has to be done carefully to ensure the stability of the ship is not compromised by speed. The Guider system has a library of every vessel berthed in the terminal and it is able to outline the optimal sequence for discharging and loading ships.

When containers are loaded into the container yard, it is critical for HIT to know exactly where is each container. The yard automation system has detailed information on each container, plus a map that has the precision location of up to 90,000 TEUs in the terminal.

Naturally, HIT also relies on EDI to speed up paperwork between ships and the terminal. The customer plus platform was launched in 1998, and extended in 2003.

The Future

While it is common to propose the ports of Singapore and Hong Kong as rivals, in some ways, this is a superficial construct. Topping the league table may bestow bragging rights but, in truth, both Singapore and Hong Kong serve very different markets, thanks to their location. The real rivals that both ports face are in their own backyard.

Singapore's biggest rival is the Port of Tanjung Pelepas in nearby Malaysia, while Hong Kong has numerous rivals in the Pearl River Delta Region, as well as elsewhere along the coast of mainland China.

As established ports, both Singapore and Hong Kong will have to fend off younger, lower-cost and more eager competitors that will work harder to grab market share. Hong Kong faces a considerably more competitive environment, already being behind Shanghai.

As a result, while Singapore has held a traditional lead in terms of technology deployment, the fierce rivalry between Hong Kong and the port of Shenzhen, as well as the port of Shanghai, will probably force Hong Kong to make changes.

Hong Kong cannot change its comparatively higher cost base and the fact that its rivals are on the mainland and thus closer to China's factories. It can, however, use technology to become even more efficient.

Fairfax Business Media

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