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Sustainable port clusters and economic development

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PALGRAVE STUDIES IN MARITIME ECONOMICS Edited by Elvira Haezendonck Alain Verbeke Sustainable Port Clusters and Economic Development Building Competitiveness through Clustering of Spatially Dispersed Supply Chains Palgrave Studies in Maritime Economics Series Editors Hercules Haralambides Erasmus School of Economics Erasmus University Rotterdam Rotterdam, The Netherlands Elias Karakitsos EN Aviation & Shipping Research Ltd London, UK Stig Tenold Department of Economics Norwegian School of Economics Bergen, Norway Palgrave Studies in Maritime Economics is a new, original and timely interdisciplinary series that seeks to be pivotal in nature and improve our understanding of the role of the maritime sector within port economics and global supply chain management, shipping finance, and maritime business and economic history The maritime industry plays an increasingly important role in the changing world economy, and this new series offers an outlet for reviewing trends and developments over time as well as analysing how such changes are affecting trade, transport, the environment and financial markets Each title in the series will communicate key research findings, shaping new approaches to maritime economics The core audience will be academic, as well as policymakers, regulators and international maritime authorities and organisations Individual titles will often be theoretically informed but will always be firmly evidence-based, seeking to link theory to policy outcomes and changing practices More information about this series at http://www.palgrave.com/gp/series/15187 Elvira Haezendonck · Alain Verbeke Editors Sustainable Port Clusters and Economic Development Building Competitiveness through Clustering of Spatially Dispersed Supply Chains Editors Elvira Haezendonck Department of Business Vrije Universiteit Brussel (VUB) Brussels, Belgium Alain Verbeke Haskayne School of Business University of Calgary Calgary, AB, Canada Department of Business Vrije Universiteit Brussel Brussels, Belgium Henley Business School University of Reading Reading, UK Palgrave Studies in Maritime Economics ISBN 978-3-319-96657-1 ISBN 978-3-319-96658-8  (eBook) https://doi.org/10.1007/978-3-319-96658-8 Library of Congress Control Number: 2018951047 © The Editor(s) (if applicable) and The Author(s) 2018 Chapter 4 is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/) For further details see license information in the chapter This work is subject to copyright All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed The use of general descriptive names, registered names, trademarks, service marks, etc in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations Cover credit: Hans Berggren/GettyImages/Fatima Jamadar This Palgrave Macmillan imprint is published by the registered company Springer Nature Switzerland AG The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland Dedicated to our beloved families Foreword Nearly every segment of international supply chains is seeking to rationalize its operations through mergers or strategic alliances This includes shipping lines, terminal operators, and shippers It would appear, when engaging in a superficial analysis, that port authorities remain the one notable exception to far-reaching cooperative arrangements, at least in relative terms, vis-à-vis other economic actors in the supply chain It is correct that cooperation between port authorities has not yet resulted in a major consolidation wave, in contrast to what has occurred in other segments of the chain However, recent cases of consolidation at the port authority level exist One example is the well-reported case of Ghent and Zeeland Seaports, which merged into the “North Seaport” last year Other recent mergers include those of Hamina and Kotka in Finland, and the state-owned port companies of Ningbo and Zhoushan in China The Northwest Seaport Alliance is not a merger, but a far-reaching cooperation agreement between the ports of Seattle and Tacoma in the USA that joined the marine cargo operations of both ports The North Seaport and the Northwest Seaport Alliance are examples of bottom-up cooperation In contrast, the recent reform of the Italian port system, which reduced the number of port authorities vii viii     Foreword from 25 to 14, is a top-down case As the port authorities are owned by the central government, it was the Italian state that pushed forward this consolidation More consolidation of port authorities will become inevitable, given the developments in the market toward gaining scale and scope economies, but also given environmental and societal pressures Land is a scarce good, and competition for land use is therefore very high What complicates far-reaching forms of cooperation between port authorities are public ownership and related institutional impediments to common initiatives An important precondition for successful cooperation projects therefore lies in the autonomy of port authorities Port authorities should be free to determine the business case for cooperation and to act upon this If such business case is missing, then the likelihood of success becomes a lot smaller In addition to formal mergers and alliances, there are many other ways in which port authorities cooperate today with a variety of stakeholders Such cooperation can range from joint investments in hinterland connections to clean air programs The ports in San Pedro Bay are a good example of the latter We can expect a growing number of these initiatives, for instance, in the field of the “circular economy,” whereby port authorities work together with their industrial clusters, inter alia, to give new economic purpose to waste products such as wastewater that was used to cool down industrial installations, and can be used further for urban heating purposes As a complement to regional collaboration, ports also cooperate in a “transoceanic” fashion Think of initiatives such as ChainPort, a network started by the ports of Hamburg and Los Angeles, as a dissuasion tool against protective attitudes about data sharing Or think of the World Ports Sustainability Program, a partnership between IAPH and several international port-related organizations to develop and showcase the global leadership of ports in contributing to the Sustainable Development Goals of the United Nations and to empower ports in providing sustainable value added to their communities The above suggests substantial levels of ongoing cooperation in the port sector, including joint initiatives at the level of port authorities Mergers and alliances, however, remain rather exceptional cases, and Foreword     ix this is largely due to the institutional context within most port authorities function Given the increasing number of port authorities becoming “corporatized” (meaning their morphing into business units with arm’s length linkages with political decision makers)—and in some cases their privatization—it may be only a matter of time before we will witness more widespread consolidation, as observed in other segments of the supply chain I warmly welcome this exciting, new research volume by Elvira Haezendonck and Alain Verbeke, two leading scholars in the area of seaport strategic management The different chapters in this book rigorously highlight the many drivers and impediments to seaport cooperation, both at the cluster level and beyond This book will allow substantial reflection by enlightened seaport authorities and port cluster managers, on crafting win-win conditions for long-term, strategic collaboration One key lesson I have learned from reading this volume is that port authorities and port clusters alike should develop strategic capabilities in collaboration and understand the underlying industrial logic behind any cooperative initiative Opportunistic “get-togethers,” supported by some surface-scratching accounting data, are a particularly poor basis for long-term, strategic alliance formation involving seaports Antwerp, Belgium Dr Patrick Verhoeven Managing Director—International Association of Ports and Harbors (IAPH) Praise for Sustainable Port Clusters and Economic Development “In an era of growing concerns about port clusters’ externalities and their shift towards more international strategic cooperation and M&A activity, this book provides sound managerial advice on long-term, sustainable cluster development.” —Dr Jan Hoffmann, Chief, Trade Logistics Branch, Division on Technology and Logistics, UNCTAD and President of the International Association of Maritime Economists “As Series Editor, I am proud to include this ‘jewel’ in the collection: It delivers a fascinating and absorbing account on the role of cooperative initiatives in modern port management.” —Professor Hercules Haralambides, Editor-in-Chief of Maritime Economics and Logistics, Texas A&M University, USA xi *p 

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