- Email: [email protected]
Political issues in inland waterways port development: prospects for regionalization
Transport Policy, Vol. 4, No. 4, pp. 251-265, 1997
PII: SO967-070X(97)00020-6
o 1997 Elsevier Science Ltd All rights reserved. Printed in Great Britain 0967-070X/97 $17.00 + 0.00
Political issues in inland waterways port development: prospects for regionalization Claude Comtois Departement de geographic, Centre de recherche sur les transports, Centre-ville, Montreal, Quebec H3C 357, Canada
Universite de Montreal,
C.P. 6128, succursale
Brian Slack Department of Geography, Center for Research on Transportation, West, Montreal, Quebec H3G lM8, Canada
Concordia University, 1455 De Maisonneuve
and Gunnar K. Sletmo Departement de Marketing, J&ole des Hautes l?tudes Commerciales, Montreal, Quebec H3T 2A7, Canada
3000 Chemin de la Cote Sainte-Catherine,
In the vast scientific literature on maritime transport, one theme appears neglected: the juridicopolitical framework in port development. We first examine how the jurisdictional control influences the allocation of resources and financial responsibilities. Second, we carefully evaluate conventional theoretical explanations of the process of port development as it generates important consequences on port policy formulation. We suggest that the concept of the port transition needs to be positioned within a new paradigm of the regional economy. Third, by focusing on three case studies namely France, China and Canada, we provide an understanding of institutional structure and how they reflect tendencies in port development. We then investigate regional flows, particularly the role of offshore, inshore and coastal traffic. Fourth, we present policy options for regionalization of ports. Fifth, we explore the regional elements of the port transition and provide an appreciation of the new role of the State in port development policies. The paper concludes on the adoption of new paradigm in port development strategies. @ 1997 Elsevier Science Ltd. All rights reserved Keywords: maritime transport,
ports, jurisdictions,
regions
Premises Most scenarios on the future growth of world trade accept ports as a fundamental element of exchanges. In Europe, major works are planned for an optimal use of major water arteries such as the Rhine and the Danube (ECIS, 1994). In North America, recent studies demonstrate a changing emphasis in the strategies of maritime companies to influence or fulfil the political agendas of government for the integration of South America into NAFTA (Slack et al., 1995). In East and Southeast Asia, a restructuring of maritime routes can be observed within a new political geography of transportation (Rimmer and Comtois, 1996). Evidently, these modifications to maritime geography raise predictable fears concerning port development policies that will be needed to accommodate this growth on the
one hand, and on the other hand, the problems raised by the creation of new infrastructures. These predictions of changes in the structure of the water transport industry are largely based within the framework of the existing port typology. Indeed, the new commercial horizon is a function of growth rates reflecting the performance of the previous decade that, when projected, suggest an increase in inequalities between big ports and secondary ports. This condition reflects the preponderance of ports having substantial comparative advantages, reinforced by their position at the summit of a hierarchy of jurisdictions. Without denying that port development must operate in a commercial context, the objective of this paper is to suggest that the working out of port policies requires a careful re-evaluation of the juridico-political framework, which in this investigation involves in part the discarding 257
Political issues in inland waterways port development:
C Comtois et al.
of the mental baggage of concepts and ideas that are part of a set of port theories that has grown out of the principles and experiences of the market economy.
Port policies Following an approach used by Vigarit (1987) and McGee (1994), three main factors of this market economy experience are apparent. Firstly, there is a fundamental divide between big ports and secondary ports (Mayer, 1973). This dichotomy is portrayed spatially by their relative position along the major maritime routes (Hoyle and Hilling, 1984), sectorally in terms of containerization and non-containerization (Chilcote, 1988), politically in jurisdictional control (Ircha, 1993; Goss, 1979, 1990), and even from an ideological point of view in the formulation of policies related to the different categories of ports. Secondly, the search for scale economies, in which a majority of port activities will be undertaken in big ports is unilinear and inevitable. Thirdly, the advantages of the process of accumulation are a necessary condition of the process of economic growth. A few conventional theoretical explanations of this process of port development even postulate that the distinction between big ports on the one hand and, on the other hand, small and medium size ports will be reduced as the latter will progressively disappear with the emergence of transactional world centers. There is no need to reiterate the arguments that are used to support this theoretical position, for there exists a vast scientific literature on the subject. But there is a need to underline that this body of theory and its assumptions are the major explanatory tools applied to maritime geography in Europe, in East and Southeast Asia and in North America and consequently dominate the perspectives on port development. In view of this we would like to suggest that a careful evaluation of this body of theory on ports is required as it generates important consequences on port policy formulation. Indeed, the conditions that preside over the implementation of contemporary port development projects are radically different from those in which they were conceived. More precisely, the inevitable transition towards major harbour infrastructures resulting from agglomeration economies and comparative advantages is put into question in three respects. Firstly, it is too narrow in its widely accepted presumption that the divide between big ports and secondary ports will persist with maritime traffic growth. There will indeed be a considerable growth in maritime traffic resulting from the application of WTO accords, from the concrete shaping of the European Union, from the development of NAFTA and the increasing partnership of ASEAN. Ports will have to support a heavier burden. But ports are hard compressed by increasing deficits, by the need to rationalize resources and by severe environmental legislations concerning coastal zones (Wessel and Hershman, 1988). 258
Secondly, it is inadequate in its assumptions that the transition towards important port industrial complexes will be inevitable, following operations of scale economies and comparative advantages, that pretend to facilitate the concentration of maritime traffic in ports located along major maritime routes. The vast majority of ports are not like Hong Kong, New York or Rotterdam. The conventional theoretical explanations appear generally inadequate to explain the growth and mostly the persistence of small and medium size ports (Comtois et al., 1993). The disappearance of these ports has not been demonstrated empirically (Hilling, 1988). The development of modem transport technology has greatly facilitated the internationalization of exchanges. Historical factors, the most important of which is certainly economic grouping, has created various spatial and functional organizations of maritime networks that structure international exchanges. Thirdly, the paradigm of the process of port transition draws its rationale from the historical experience as it has occurred in Europe, in North America and in East and Southeast Asia in the late 1980s which is clearly not transferable within the port context of the third millennium. We have previously argued that the integration of East and Southeast Asia into the areas of influence of Western European colonial powers from the sixteenth century onwards has imposed a new transactional network, thus forcing the marine merchants to adapt to the new network or to marginalize their activities (Comtois, 1993). Geopolitical events resulting from the cold war also imposed a new direction to the traditional transactional maritime network of these regions by dividing the world in two major political and ideological spheres of influence. This has further been supported by the recent work of Fremont (1996). In a similar manner, the doctrinal position of Eastern Europe concerning foreign trade has for a long time confined the maritime economy to a marginal role (Vigarie, 1987). These selfsufficient and continentalist tendencies were gradually softened to eventually allow a participation in maritime world trade generally at the same rhythm as its growth rate. But the delays resulting from this slow conversion, parallel to the considerable geopolitical changes in Eastern Europe, meant that the shipping and port sectors of these countries have emerged as very fragile, with very high waterborne trade demands and very low port assets. Finally, the planetary strategy of the United States required a logistical system of such magnitude that much of the transport responsibilities were contracted to the private maritime sector. Therefore, for almost half a century, the productivity and efficiency of a substantial part of the shipping industry was artificially maintained. With the profound mutations occurring across the world, following the collapse of the former Soviet Union, the United States has to engage in a new political and The prospects for maritime economic agenda. development are enormous and intermodal transportation will affect the complete restructuring of the
Political issues in inland waterways port development:
American transport industry. While many of the details still remain to be worked out, an element appears indisputable: the costs involved in such an endeavour require the practice of a continental solidarity. Given these inadequacies, it is suggested that the concept of the port transition needs to be positioned within a new paradigm of the regional economy of ports. This would include: (1) an understanding of institutional structure and how they reflect tendencies in port development; (2) an investigation of regional flows, particularly the role of offshore, inshore and coastal traffic; (3) a sensitivity to the regional elements of the port transition; and (4) an appreciation of the role of the State in port development policies. Essentially, such an approach attempts to present political options for port development within specific countries.
Regionalizing port development The issues raised above are central to an understanding of the limits to port development. The major question must be whether ports can experience a structural transformation in their juridico-political framework that is associated with a new form of regionalization and the successful realignment of their strategies into regional economies during this transition. One way in which to make these processes clearer is to illustrate them through case studies. We wish to understand port policies in three major areas, namely Europe, East Asia and North America because we want to document and analyze the limits to port development under radically different conditions. The countries that are at the core of our research efforts are France, China and Canada. They have been selected because they do not share the same conditions or processes. Indeed, the major coastal and inland waterways of France are underused, while secondary ports continue to persist. Besides, France has a long history of State intervention in local and regional planning that has integrated the economic and physical needs of ports and their relative impact (Marcadon, 1988). China, on the other hand, is a country with very high demographic density where most maritime trade is handled by large ports, but where small and medium size ports fulfil very specific functions. Furthermore, in China, administrative and economic changes are influencing very strongly the functioning integrity of the port system (Vigarie, 1992). Finally, Canada is characterized by a vast territory with a low population density where maritime trade is essentially resource based. But, more interestingly, Canadian ports are administratively fragmented by a considerable variety of jurisdictions (McCalla, 1994). France The waterways of France have been highly influenced by a rigid model of bureaucratic State centrality that
C Comtob et al.
confers high regard to the development of a depersonalized control through public laws (Strohl, 1990). Ideological or political factors have had little influence upon this process. Centralized sectoral management and governmental direction, characteristic of the French public policy system planned the country’s water transport network and infrastructures. The State Plan provides the principal water transport policy directives. Basically it is a planning document that represents a set of priorities for financing and realisation. Through a large and complex body of administrative laws, it provides oversight, technical and policy formulation for France’s inland waterways and ports. In view of this, the steps engaged towards decentralization that have taken place in France since the mid-fifties must be interpreted as a process to formalize the mechanics of the Plan in the region through the regional transport master plan together with the possibility for some subsidy from a commission for land use and regional action: the Delegation a 1’AmCnagement du Territoire et a 1’Action Regionale (DATAR) rather than a true decentralization of autonomy and responsibilities. There are essentially two types of ports in France: the autonomous ports - a status granted in 1965 to six ports, namely Dunkerque, Le Havre, Rouen, Nantes, Bordeaux, and Marseille, where the State assumes 70% of infrastructural investments; and ports of national interest jointly managed by local Chambers of Commerce and Departments of Equipment, where the State assumes 40% of investments in infrastructures. The administration of the waterways infrastructures is under the authority of the Ministry of Transport. Since 1991, the application of regulations concerning the commercial exploitation of navigable waterways is under the jurisdiction of the Voies Navigables de France (VNF). VNF is responsible for the exploitation, the maintenance, the modernization and the extension of the network as well as the management of the public fluvial domain. With a total length of 8568 km, the French interior navigable waterway system has been able to profit from the most important inland waterway systems of Europe. But it is marked by five major characteristics. Firstly, 60% of the navigable waterways are located north of a line linking Le Havre to Mulhouse. This area accounts for one of the most urbanized and economically prosperous regions of France. Secondly, the network is of unequal capacity. Many of France’s rivers and canals are commercially exploitable. But very few are of European scale class (over 3000 tons) and can thus be considered as having long-term prospects of commercial viability. Only the Dunkerquevalenciennes canals, the Moselle, the Rhine, the Seine, the Rhone rivers and the estuaries of the Loire and the Garonne are of European scale class. As a result, the European scale class carries 90% of the waterways traffic volume (tons) and 95% of the waterways traffic turnover (ton km). Thirdly, of these large-scale inland waterways, only the Dunkerque259
Political issues in inland waterwaysport
development:
C Comtois et al.
Valenciennes canals, the Moselle and the Rhine rivers are connected to other European waterway systems. As a result, these waterways serve a transit function. Figures demonstrate that 30% of the exchange traffic tonnage with Germany is undertaken by waterways. This figure increases to 44% with Belgium and the Netherlands (Strohl, 1990). Fourthly, many river ports such as Le Havre, Rouen and Paris along the Seine, Dunkerque and Valenciennes in the north, Strasbourg along the Rhine, Lyon along the Rhone are directly accessible by fluvio-maritime ships from other European countries or even North Africa. But many of these waterways are either isolated or linked to one another through small scale canals. Inter-basin traffic is not preponderant. As a result, France’s commercial waterway traffic is essentially single basin oriented. Studies and government reports published in the late 1980s underline the need to create inter-basin linkages of European scale class (Boussuge, 1990). Therefore, the localized traffic density of canals of European gauge, coupled with service fragmentation, has led to a reduction in inland water traffic. The implementation of policy decisions to improve the role and the share of inland waterways in the country’s commercial activities thus becomes very complicated. Fifthly, another important factor is that the waterway fleet of France is largely composed of separate business enterprises operating single barges. It is the owneroperators that own the majority of self-propelled boats. French politics have protected the owner-operator of the individual boat from competition not only with the fleet owners that are usually more capital intensive, but also from other owner-operators. This strategy however will need to be carefully re-examined. The abolition of international boundaries will not only reduce national administrative protection, but will introduce the prospects of having part of the traffic being diverted to eastern waterway vessels that could be highly competitive on a commercial basis. In 1995, acknowledging that the port and water transport geographic reality was marked by organizathe French authorities have tional deficiencies, mandated VNF to link four major fluvial arteries: (1) the Northern Seine linking the Seine, the Oise and the Northern canal; (2) the Rhine-Rhone between Niffer and Saint-Jean-de-Losne; (3) the Eastern Seine between the Seine and the Moselle; and (4) the Moselle-Saone permitting to integrate the network (Marcadon, 1996). One of the first impacts of this public initiative has been the emergence of regional port alliances. Hence the ports of Lille and Paris are carrying out a uniform program of development, while the ports of ChPionsur-Saone, Macon, Villefranche and Vienne have merged with a view to create a regional port authority: Aproport.
China China is officially a centrally is formulated by the Chinese 260
planned economy. Policy Communist Party and the
Central Committee through five-year plans, that embody the socio-economic development of the country. The country is now in the first phase of its ninth five-year plan (19962000). Water transport is under the responsibility of the Ministry of Communications. The Ministry manages directly 15 major seaports, two coastal shipping lines, China Ocean Shipping Company (COSCO) and the main stream of the major waterways. But it must be underlined that even at the height of the centrally planned economy, neither the individual’s choice of means of transportation nor the desired amount of water transport within the country were restricted by the State. While decision making in rail, pipeline and air transport is highly centralized, all levels of government have a role to play in the decision making process related to the water transport sector (Yenny, 1990). The central government concentrates on major infrastructural projects, while the local and provincial governments are responsible for inland waterways. Most of the extensive water transport systems, including infrastructure and equipment and their operations, are managed by provincial and local authorities. But recently, more flexibility has been introduced into the very rigid and bureaucratic system. A decentralization process is taking place in China where more autonomy and responsibilities are being granted to major seaports and shipping companies. Besides, the reforms have allowed villages, household or private owners to operate on a free market basis. This process however is much more conjectural than structural as it fails to consider the meso network of Chinese inland waterway ports. China has a long water transport history and the detailed analysis of the growth of the country’s waterway network and shipping industry has been well studied (Leung, 1981; Comtois, 1990; Comtois et al., 1990; Song, 1990; Sletmo and Boyd, 1993). These authors have demonstrated how the development of marine infrastructures is conducive to participation into the world economic market. Two points appear neglected however. Firstly, the 1983 administrative reform undertaken by the central government changed the traditional province prefecturecounty hierarchy to that of province-citycounty hierarchy. As a result, there are now four types of administrative division conditions occurring in China: (1) a strong leading city surrounded by poor counties; (2) weak or poor city and counties; (3) strong city and counties; and (4) a weak leading city surrounded by strong or wealthy counties. In the first case, the reform could have a positive impact since the city assumes the role of growth pole. The second case does not represent much of a change from the prereform era. The administrative entities still rest their development on self autonomy. In the third and fourth the reform has brought severe cases however, competition between the city and its surrounding counties. The city leading county system has had negative impact on port development. Indeed, in the
Political issues in inland waterways port development:
third case, since the economic structure of city and county are very similar, monopoly policies are being promoted or even implemented. As a result, the catchment areas are very small. These administrative units will distribute much, but over a small territory. In the fourth case, since cities are developing at a slower rate then their surrounding counties, they have their own incentive for economic growth. Cities will often prefer to develop their own administrative area to the detriment of the counties under their jurisdiction. As a result, many developments that could or should have occurred in the counties are now occurring in the cities. This is particularly verifiable with regard to ports. Indeed, if a city has a facade on the Yangzi river, it will attempt to develop its own port. This has even led to the development of unnecessary port infrastructures. There is thus a very intensive competition between small and medium size ports on the Yangzi river. These were traditionally national or provincial ports but the tendency is towards city-based ports. This system will not only have an impact on urban development but will hinder the comprehensive development of the Chinese port system (Comtois and Foggin, 1996). Secondly, Chinese ports are classified under four categories: inland waterways ports, the Yangzi river ports, the coastal ports and the ocean oriented ports. Inland ports can be planned by local administration, while the Yangzi river ports are designed by the Yangzi River Water Transport Bureau and the Ministry of Communication. But this classification is somehow simplistic as some inland ports also handle ocean shipping. More importantly, the recent changes in the port management system are not uniformly applied. Of all the 15 ports under the responsibility of the Ministry of Communication, only the port of Qinghuangdao is totally run by the central government. All the others are jointly supervised by the central and the provincial governments or between the provincial and the local governments. The small ports are managed by the local governments. Moreover, in many cases, rights and responsibilities have been transferred to the port authority. The port authority thus possesses the port assets and has considerable power over the organization of distribution of berths and over the establishment of handling companies as subsidiaries. The port authority can thus fix its own agenda and development plans that are not coordinated either with the city plans or those of the Communication Ministry. The apparent jurisdictional hierarchy is therefore blurred by the fact that there is still a clear division between entrepreneurial and political management. The problem is exacerbated by the fact that each administrative unit has its own freight station and shipping company. Many ports have their own transport company. On the Yangzi River, there are presently more than 800 shipping companies. Besides, private ports are being implemented. But all the ports on the Yangzi river are feeder ports for Shanghai. It would be impossible for any one of them
C Comtois et al.
. to become a major port. All this points to a water transport organization that responds in an anarchic way to the sudden increase in demand. This leads to: (1) a modification of port distribution, (2) a redistribution of catchment areas for ports, (3) an overcapacity on waterways, and (4) a surplus in handling capacity for water transport. Given the increasing growth of container movement, there is an urgent and mutual need for ports to consider the strength of linkages and promote the development of a regional network. Canada Public responsibility for the management of inland water transportation in Canada is extremely complex. Domestic maritime transport activities in Canada are defined as marine cargo traffic between Canadian ports. These activities are divided into five sectors: the inland waterways which comprise the Saint Lawrence-Great Lakes system and all the shipping activities occurring in the rivers and lakes located in Canada; the coastal activities of the Atlantic, the Pacific and the Arctic ocean and the MackenzieGreat Slave Lake systems. Two important features of Canada influence the country’s water transport policy. Firstly, the federal character of Canada, where the basic organizations of government levels can possess a considerable degree of autonomy, and secondly, the size of the country which constitutes a primary obstacle to the country’s integration. These two facets account not only for the basic characteristics of water transportation policy but also for many problems faced in other policy areas. Several administrative reforms have been adopted and vigorously implemented since the founding of the confederation in 1867. Despite many modifications to the port system of the country, the problem has remained the same: organizational linkages tend to be horizontal, across jurisdictions, rather than vertical. Within the dual federal and provincial hierarchical system, there is no unified central administrative bureaucracy ultimately responsible for the inland waterway system. Policy making is exercised by several technically oriented agencies. This fragmentation is further compounded by Canadian federalism which reproduces many counterpart agencies at the provincial level. As a result, water transport policy is scattered among very diverse administrative units that each exhibit particular legal, financial and operational norms and procedures that are not fully coordinated by a single political actor. On the Saint Lawrence system alone, there exist six different types of administrative agencies, corporations, commissions or ministries that perform maritime or port activities. Funding and operation of ports are divided among the levels of governments and the private sector. Therefore, port infrastructure investments are not necessarily complementary to the national system. Small ports finances have been adversely affected by a politically motivated investment policies. The public corporations with
Political issues in inland waterways port development:
C Comtois et al.
government capital participation and oversight have added to the politization of ports. The special status given to some ports proves to be problematic. Some ports have a special responsibility for providing transportation services to the general public. But this situation leads to demands of services and investment without any thought given to the ports’ financial health. There is thus a lack of balance within the Canadian port structure because each port administration and agency has evolved as a function of their own politicaladministrative dynamics. Many policy decisions have been aimed at correcting this imbalance. But coordination requires major initiatives coupled with a maintenance of funding. With large internal debt contributing to a serious economic crisis, the Canadian government has not been able to sustain such a system. Throughout most of its history, transportation in Canada evolved as a function of the economic exploitation of the land’s potential. The points of origin of the most important cargos, the raw material hinterland in Alberta, Saskatchewan and Manitoba for instance, have fostered the development of transport corridors. Many port investment projects were thus driven by the country’s mineral export policies. Furthermore, given the sporadic ecumene of large areas of Canada and the need to integrate the whole country, the national government was forced to subsidize many of the ports and water transport in remote areas. In 1996, the federal transport ministry presented a bill to modify the government operational role in the maritime sector by proposing to withdraw from direct exploitation while maintaining commitments with regards to transport safety, environment and services to remote communities. Under the proposed legislation, of the former 607 ports accounted in Canada, only 60 will remain under the jurisdiction of the Ministry of Transport, 245 will be turned over to local and regional authorities, eight major ports will be established as local commissions, 59 will be transfered to the fishery department, 200 will be declassified and the remaining 35 will be under private, municipal or provincial jurisdiction. These changes in the administrative structure of the Canadian port network are the result of thorough analysis in inland waterways trade flows. Despite the magnitude of the country’s extensive water network, over half of the domestic marine cargo was handled within Canadian inland waters, essentially on the Saint Lawrence-Great Lakes system. Of these inland areas, the national government concentrated on the construction or modernization of ports along the Saint Lawrence. These new ports have been designed for specific products and have been equipped with the But these fluvial navigation latest technology. improvements were following rather than leading other economic activities. On the Saint Lawrence river system, freight volume accounted for 110 million tons in 1995. The traffic of international marine cargo reached 72% during the same period. 262
Recent discussions and policy options presented to the national government suggest major transfers of water transportation responsibilities to the provinces and municipalities, the privatization of the marine services and the adoption of the principle user pay. Because of the geographical situation of the waterways, this decentralization and deconcentration processes will not change the performance of the water transport sector unless Canada adopts the principle of subsidiarity by identifying services to the water transportation industry that the local organizations can perform more effectively in terms of responsibility, capacity and efficiency than the dominant central organization.
Policy options for regionalization
of ports
There is a vast scientific literature demonstrating the positive aspects of inland waterways. Very briefly, waterway systems consume the least amount of energy per ton- km as compared with the other modes of transport, and the ton- km cost for waterway transportation is very low. As a result, waterways are most apt to be used for bulk commodities, some agricultural products and construction materials. In some areas, waterway services are absolutely required for the continued economic health of many outlying areas. Moreover, waterway traffic is environmentally more favourable than competing modes. Finally, ever increasing freight traffic on highways that results in congestion lends support to a renewal of waterways. Besides, it must be remembered that some highways continue to operate at a deficit, with the likelihood that shortfalls will become proportionally large over time because of the increased maintenance costs. The above highlights the important role played by national government in the development of inland waterways and the port system of France, China and Canada. In these countries, there is a commitment to a mode of transport that only contributes marginally to the economy. But the inland waterways sector with its considerable economic implications and ramifications reveals itself consistently across the case studies, as a weak point in the transportation structure of each country. This is the more surprising since the opportunities for the State to influence supply and demand in that sector have been considerably broadened with increasing trade opportunities. We have also shown the limits of national policy responses to the demands of changes and and technological the economic imperatives of ports. Policies have been initiated in response to expressed needs to improve upon an existing policy or to improve upon the operation of the service that the existing policy provided always upon a background of changes and rising expectations. The results of this situation are that the general scarcity of investment resources has stood in the way of a speedy, uninterrupted and comprehensive modernization and
Political issues in inland waterwaysport development: C Comtois et al.
expansion of traffic and fleets of the water transportation systems. Much points to the fact that planning for port as well as commitment of investment resources for the past years has been oriented towards short-range development. If inland shipping and ports are to achieve greater significance, then new canals must be built, networks in industrial areas must be expanded, shipping fleets must be modernized and inland ports favoured. The main question is what will it cost and who will pay for it? Faced with increasing pressures to provide fresh investments, national authorities have responded either by massive privatization or by strengthening public ownership. We suggest that a significant increase in the capacity and efficiency of the water transport system can be realized through another alternative in port planning, namely regionalization. Traditionally, maritime transport has helped the construction of regional territories, and in turn, regional territories have been at the source of maritime demand. Much research has been undertaken on the relationship between maritimization, the process of developing maritime trade, as coined by Guillaume (1996) and regionalization. But the standardization of freight handling, the geographical discontinuity of different elements, notably the tertiary service sector in maritime transport and the limits in port complex in polarizing economic activities both sectorally and spatially have considerably altered the mutual fertilization of regions and maritime trade. We therefore propose three issues to animate the relationship between ports and regions. Firstly, port regionalization will be successful if it is included within a market economy framework of competition. Regionalization must become a means for increasing responsibility of regions. It is thus within this context of responsibility that regionalization must be evaluated. The responsibility for the functioning of each port or group of ports operations must be assigned to a region that would be responsible to animate its port system within the whole country. The carriers and the forwarders of commodities are often located outside the port area. But by adopting a regionalization approach, the functions of ports would then be modified so as to consider the environment within which they operate. This would firstly permit to internalize within the region the externalities generated by the ports; secondly, reduce the cost of transactions through complementarities generated within the region; and thirdly increase the exchange of information between forwarders and carriers within the region thus rendering the ports more competitive. The realization of an optimal port system is discouraged by frequently changing orientations and guidelines which alter, abolish or reverse previous ones, hence confirming the need for the creation of regional markets. The new structure reflects the importance of developing comprehensive and efficient policies in the areas of international and regional local transportation and freight
distribution. The reorganization of various levels of transportation administration into regional transportation bureaus emphasizes policies based on a more objective assessment of needs rather than the vertical or individual systems which have led either to an inefficient and uncontrolled use of public resources or to unnecessary duplication of investments for the development and expansion of ports and water transportation systems. Secondly, the size of the region must allow the regional authority to have the capacity to solve problems. There is no ideal size of region, but the size must be small rather than large and must rest on spatial proximity. This will play an important role related to maritime dynamics notably as a base for information exchanges, agreement on common objectives and collective process of learning between ports. Indeed, certain ports are more dynamic then others. But all ports located within a region could observe the secret of success, reduce the rate of decline or assist in the elaboration of initiatives of the other ports. More importantly, the size of the regions must be defined or composed of several types of ports so as to enhance the necessary competition required for successful accountability. The region’s port system must be sufficiently pluralistic so as to permit the participation of all types of ports. Indeed, a sectoral approach based on type of traffic for instance would not be appropriate for regionalization. There are very few sectors where scale economies can be achieved. Levels of expenses per port tend to increase rather then diminish with the size of regions. Revenue in turn is difficult to evaluate with the size of regions but recent work demonstrates that cost-benefit analysis exhibits certain weaknesses because the compatibility of results between different regions is not always available (Slack et al., 1993). A grouping of ports could lead to the separation of economically viable and non-viable services and thus increase pressure to eliminate the latter. But a thoughtful regionalization process could permit cross-subsidy. Profit making ports or routes could make up for losses in another port, services or routes. The main problem has and will be the lack of investment capital. The over-riding strategy should then be to determine funding level according to the level of traffic. Thirdly, what is needed is a total systems approach to transportation, one considering traffic demand in terms of regions, commodities and corridors, not just port by port, thus stimulating balanced regional growth. Of particular concern is the need to coordinate the water transportation improvements in big ports with secondary ports in the surrounding region. Many small ports bring a considerable support to the regional and local economy while not being located along the major liners route. The task of regionalization is to lower the level of subsidies and to achieve the greatest economic yield. Obviously, this process would influence the supply side of the market through incentives for market restructuring. To avoid 263
Political issues in inland waterways port development:
C Comtois et al.
chronic overcapacity in ports, a regionalization approach could reduce the number of ports. This could be achieved through a flexibility in the maintenance of a stable number of ports, a number that would initially be tied to demand. Given that performance is not measured by distance, but by density and volume, there is a need to emphasize high volume transportation improvements or quick turnover if small ships serving regional needs can prove to have comparative advantages over big ships. As a result, the remaining infrastructures would exhibit a high degree of modernity. The goal of capacity equilibrium at the regional level would be achieved. The regionalization approach would increase the coherence and reduce the cost of water transportation administration and through tight solidarity would increase opportunities for profit by increasing accountability. Opportunities thus abound for the cabotage sector to continue to play a major role in shaping the direction of economic development.
A new role for the state One must always remember that the proprietor of the transportation infrastructure, namely the waterways, still remains the national government. But the adoption of a regionalization of the port system raises interesting avenues in port policy decisions for the State. Given some regions’ low levels of competence in the areas of planning and development, the first task of the national government would be to provide training in port and water transportation planning with a view to facilitate the process of regionalization. This should include public relations and communication techniques, quality control methods, qualitative and quantitative data interpretation analysis and project management administration. We believe that such training would enhance investment planning processes. Secondly, given the major technological changes, the varied strategies of enterprises, the implementation of free trade agreements, it becomes necessary to develop networks, partnership, alliances and even acquisitions with carriers and forwarders located outside the region, acknowledging that economic integration does not respect political boundaries. Therefore, to avoid a fragmentation of countries into multiple disconnected regional territories, the State has to assume a second task, namely to reinforce complementarity relations between regions through reductions of investment barriers, free movement of transport services across regions and unification of rules, standards and certilications. This would foster the integration of regional port planning across national borders. A third task would be for the State to concentrate on investing massively and without hesitation on the development of containerization and on the information highway. Combined transport offers operational as well as managerial advantages, while information flow generates transport which in turn brings traffic. 264
A final task would be for the State to increase its responsibilities in developing economic, social and cultural exchanges, to assist in favourable foreign exchange position and to enhance the image of the country abroad.
Concluding remarks The waterway transport and port policies are exhibiting the appearances of undergoing fundamental changes. The highly centralized model is no longer thought to meet the values and needs of the system, neither is the privatization approach. There is thus a need for a shift in the present institutional and jurisdictional structures of port systems. The option suggested here rests on the need to consider port regionalization in future water transportation policies. This approach however must not be interpreted as a panacea for all difficulties facing port systems. Some ports will have to be closed down while other berths will have to be built. It is not immediately apparent whether the regionalization of ports mentioned above will lead to further growth of the world trade. Two scenarios are imaginable. In one scenario port regionalization progresses in such a way as to complement the globalization of business activities. In another scenario part regionalization stratifies the global trade system. It is expected that maritime countries in Europe, East and Southeast Asia and in North America will discuss the conditions and procedures required to adapt their port system in relation to the maintenance and improvement of world trade. In this context, it is imperative for these countries to understand that the purpose of port regionalization resides in the qualitative improvement and quantitative expansion of the port system at home. In view of this, the paradigm of regionalization certainly deserves to be closely examined. This research was undertaken with the financial support of les Fonds pour la Formation des Chercheurs et 1’Aide a la Recherche, programme soutien aux equipes de recherche, Quebec and the Social Sciences and Humanities Research Council of Canada.
References Boussuge, A. (1990) Le transport fi’uvial en Prance. Office national de la navigation, Paris. Chilcote, P. (1988) The containerization story. In Urban Ports and Harbor Management, ed. M. Hershman. Taylor and Francis, New York, pp. 125-145. Comtois, C. (1990) Transport and territorial development in China, 1949-1985. Modern Asian Studies, 24(4), 777-818. F. and Rodrigue, J. P. (1990) The Comtois and , C., Soulard, Canadian foreland of Chinese ports. Journal of Oriental Studies, 28(2), 167-187. Comtois, C. (1993) The restructuration of transportation in China: the emergence of a new transactional environment. Publication No. 946, Centre de recherche sur les transports, Universite de Montreal, Montreal, 25 pp. Comtois, C., Slack, B., Lagimoniere, L. and Vallec, D. (1993) Role et la fonction des ports de petite et moyenne taille dans le systeme Saint-Laurent. Les Cahiers de geographie du Quebec, 37(100), 17-33.
Political issues in inland waterwaysport Comtois, C. and Foggin, P. (1996) La transformation des ports secondaires dans le delta du Yangzi. Cahiers Nantais, 46,99-l 15. ECIS (1994) Proposal for a Council and European Parliament decision on community guidelines for the development of the tram-European transport network. European Centre for Infrastructure Studies, Bruxelles. Fremont, A. (1996) L’espace maritime et marchand: pour une problematique. L’espace geographique, 3, 203-213. Goss, R. 0. (1979) Comparative Study of Seaport Management and Administration. Government Economic Service, London. Goss, R. 0. (1990) Economic policies and seaports: are port authorities necessary?. Maritime Policy and Management, 17(4), 257-271. Guillaume, J. (1996) Quelques re!exions sur les relations entre regionalisation et maritimisation par les transports. Seminaire de I’URA 904: Transports maritimes et ports de commerce, Universite de Nantes, Nantes, pp. 14-15. Hilling, D. (1988) Maritime transport technology and the revival of B&in’s small ports. In Transport Technology-and Spatial Changes, ed. R. S. Tooley. Transportation Geography Study Group, Stokeon-Trent, pp. 79-107. Hoyle, B. S. and Hilling, D. (1984) Spatial approaches to port development. In Seaport Systems and Spatial Change, eds B. S. Hoyle and D. Hilling. Wiley, Chichester, pp. l-20. Ircha, M. C. (1993) Institutional structure of Canadian ports. Maritime Policy and Management, 20(l), 5166. Leung, C. (1981) Shipping and port development for modernization. In Development and Change in China, eds E. K. Y. Chen and S. S. K. Chin. Center of Asian Studies, University of Hong Kong, Hong Kong, pp. 127-143. Mayer, H. M. (1973) Some geographic aspects of technological change in maritime transport. Economic Geography, 49, 145155. Marcadon, J. (1988) L’avant-pays des ports franpais. Masson, Paris, 208 pp. Marcadon, J. (1996) Lesportsfluviaux et les voies d’eau de France, etat des lieux et perspectives d’avenir. Institut de geographie de l’universite de Nantes, Nantes, 10 pp.
development:
C Comtois et al.
McCalla, R. S. (1994) Water Transport in Canada. Format, Halifax, 259 pp. McGee, T. G. (1994) Labour force change and mobility in the extended metropolitan regions of Asia. In Mega-City Growth and the Future, eds R. J. Fuchs et al.. United Nations University Press, Tokyo, pp. 62-102. Rimmer, P. J. and Comtois, C. (1996) Transforming the Asia-Pacific’s Strategic Architecture: Transport and Communications Platforms, Corridors and Organisations. Department of Geography, Research School of Pacific Studies, Australian National University, Canberra, 25 pp. Slack. B.. Comtois. C. Laaimoniire. L. and Vallee. D. (1993) The econom>c impact of small and medium size ports. Publication No. 890, Centre de recherche sur les transports, Universitt de Montreal, Montreal, 23 pp. Slack, B., Comtois, C. and Sletmo, G. K. (1995) Shipping lines as agents of change in the port industry. Maritime Policy and Management, X3(3), 289300. Sletmo, G. K. and Boyd, G. (eds) (1993) Pacific Service Enterprises and Pacific Cooperation. Westview Press, Boulder, CO, 274 pp. Song, Y. (1990) Shipping and shipbuilding policies in the People’s Republic of China. Marine Policv. 1. 53-70. Strohl, M. P. (1990) France.. In’ International Handbook of Transportation Policy, ed. S. Akaha. Greenwood Press, New York, pp. 93-124. Vigarib, A. (1987) .&changes et Transport Znternationaux. Sirey, Paris, 206 pp. Vigarie, A. (1992) La longue marche de I’Asie orientale vers la mer. In Le Quart Nord-Ouest du Pacifigue, ed. J. Beaujeu-Garnier. Sedes, Paris, pp. 97-171. Wessel, A. E. and Hershman, M. J. (1988) Mitigation: compensating the environment for unavoidable harm. In Urban Ports and Harbor Management, ed. M. Hershman. Taylor and Francis, New York, pp. 253-287. Yenny, J. (1990) China. In International Handbook of Transportation Policy, ed. S. Akaha. Greenwood Press, New York, pp. 41-62. I
,
I
265
PII: SO967-070X(97)00020-6
o 1997 Elsevier Science Ltd All rights reserved. Printed in Great Britain 0967-070X/97 $17.00 + 0.00
Political issues in inland waterways port development: prospects for regionalization Claude Comtois Departement de geographic, Centre de recherche sur les transports, Centre-ville, Montreal, Quebec H3C 357, Canada
Universite de Montreal,
C.P. 6128, succursale
Brian Slack Department of Geography, Center for Research on Transportation, West, Montreal, Quebec H3G lM8, Canada
Concordia University, 1455 De Maisonneuve
and Gunnar K. Sletmo Departement de Marketing, J&ole des Hautes l?tudes Commerciales, Montreal, Quebec H3T 2A7, Canada
3000 Chemin de la Cote Sainte-Catherine,
In the vast scientific literature on maritime transport, one theme appears neglected: the juridicopolitical framework in port development. We first examine how the jurisdictional control influences the allocation of resources and financial responsibilities. Second, we carefully evaluate conventional theoretical explanations of the process of port development as it generates important consequences on port policy formulation. We suggest that the concept of the port transition needs to be positioned within a new paradigm of the regional economy. Third, by focusing on three case studies namely France, China and Canada, we provide an understanding of institutional structure and how they reflect tendencies in port development. We then investigate regional flows, particularly the role of offshore, inshore and coastal traffic. Fourth, we present policy options for regionalization of ports. Fifth, we explore the regional elements of the port transition and provide an appreciation of the new role of the State in port development policies. The paper concludes on the adoption of new paradigm in port development strategies. @ 1997 Elsevier Science Ltd. All rights reserved Keywords: maritime transport,
ports, jurisdictions,
regions
Premises Most scenarios on the future growth of world trade accept ports as a fundamental element of exchanges. In Europe, major works are planned for an optimal use of major water arteries such as the Rhine and the Danube (ECIS, 1994). In North America, recent studies demonstrate a changing emphasis in the strategies of maritime companies to influence or fulfil the political agendas of government for the integration of South America into NAFTA (Slack et al., 1995). In East and Southeast Asia, a restructuring of maritime routes can be observed within a new political geography of transportation (Rimmer and Comtois, 1996). Evidently, these modifications to maritime geography raise predictable fears concerning port development policies that will be needed to accommodate this growth on the
one hand, and on the other hand, the problems raised by the creation of new infrastructures. These predictions of changes in the structure of the water transport industry are largely based within the framework of the existing port typology. Indeed, the new commercial horizon is a function of growth rates reflecting the performance of the previous decade that, when projected, suggest an increase in inequalities between big ports and secondary ports. This condition reflects the preponderance of ports having substantial comparative advantages, reinforced by their position at the summit of a hierarchy of jurisdictions. Without denying that port development must operate in a commercial context, the objective of this paper is to suggest that the working out of port policies requires a careful re-evaluation of the juridico-political framework, which in this investigation involves in part the discarding 257
Political issues in inland waterways port development:
C Comtois et al.
of the mental baggage of concepts and ideas that are part of a set of port theories that has grown out of the principles and experiences of the market economy.
Port policies Following an approach used by Vigarit (1987) and McGee (1994), three main factors of this market economy experience are apparent. Firstly, there is a fundamental divide between big ports and secondary ports (Mayer, 1973). This dichotomy is portrayed spatially by their relative position along the major maritime routes (Hoyle and Hilling, 1984), sectorally in terms of containerization and non-containerization (Chilcote, 1988), politically in jurisdictional control (Ircha, 1993; Goss, 1979, 1990), and even from an ideological point of view in the formulation of policies related to the different categories of ports. Secondly, the search for scale economies, in which a majority of port activities will be undertaken in big ports is unilinear and inevitable. Thirdly, the advantages of the process of accumulation are a necessary condition of the process of economic growth. A few conventional theoretical explanations of this process of port development even postulate that the distinction between big ports on the one hand and, on the other hand, small and medium size ports will be reduced as the latter will progressively disappear with the emergence of transactional world centers. There is no need to reiterate the arguments that are used to support this theoretical position, for there exists a vast scientific literature on the subject. But there is a need to underline that this body of theory and its assumptions are the major explanatory tools applied to maritime geography in Europe, in East and Southeast Asia and in North America and consequently dominate the perspectives on port development. In view of this we would like to suggest that a careful evaluation of this body of theory on ports is required as it generates important consequences on port policy formulation. Indeed, the conditions that preside over the implementation of contemporary port development projects are radically different from those in which they were conceived. More precisely, the inevitable transition towards major harbour infrastructures resulting from agglomeration economies and comparative advantages is put into question in three respects. Firstly, it is too narrow in its widely accepted presumption that the divide between big ports and secondary ports will persist with maritime traffic growth. There will indeed be a considerable growth in maritime traffic resulting from the application of WTO accords, from the concrete shaping of the European Union, from the development of NAFTA and the increasing partnership of ASEAN. Ports will have to support a heavier burden. But ports are hard compressed by increasing deficits, by the need to rationalize resources and by severe environmental legislations concerning coastal zones (Wessel and Hershman, 1988). 258
Secondly, it is inadequate in its assumptions that the transition towards important port industrial complexes will be inevitable, following operations of scale economies and comparative advantages, that pretend to facilitate the concentration of maritime traffic in ports located along major maritime routes. The vast majority of ports are not like Hong Kong, New York or Rotterdam. The conventional theoretical explanations appear generally inadequate to explain the growth and mostly the persistence of small and medium size ports (Comtois et al., 1993). The disappearance of these ports has not been demonstrated empirically (Hilling, 1988). The development of modem transport technology has greatly facilitated the internationalization of exchanges. Historical factors, the most important of which is certainly economic grouping, has created various spatial and functional organizations of maritime networks that structure international exchanges. Thirdly, the paradigm of the process of port transition draws its rationale from the historical experience as it has occurred in Europe, in North America and in East and Southeast Asia in the late 1980s which is clearly not transferable within the port context of the third millennium. We have previously argued that the integration of East and Southeast Asia into the areas of influence of Western European colonial powers from the sixteenth century onwards has imposed a new transactional network, thus forcing the marine merchants to adapt to the new network or to marginalize their activities (Comtois, 1993). Geopolitical events resulting from the cold war also imposed a new direction to the traditional transactional maritime network of these regions by dividing the world in two major political and ideological spheres of influence. This has further been supported by the recent work of Fremont (1996). In a similar manner, the doctrinal position of Eastern Europe concerning foreign trade has for a long time confined the maritime economy to a marginal role (Vigarie, 1987). These selfsufficient and continentalist tendencies were gradually softened to eventually allow a participation in maritime world trade generally at the same rhythm as its growth rate. But the delays resulting from this slow conversion, parallel to the considerable geopolitical changes in Eastern Europe, meant that the shipping and port sectors of these countries have emerged as very fragile, with very high waterborne trade demands and very low port assets. Finally, the planetary strategy of the United States required a logistical system of such magnitude that much of the transport responsibilities were contracted to the private maritime sector. Therefore, for almost half a century, the productivity and efficiency of a substantial part of the shipping industry was artificially maintained. With the profound mutations occurring across the world, following the collapse of the former Soviet Union, the United States has to engage in a new political and The prospects for maritime economic agenda. development are enormous and intermodal transportation will affect the complete restructuring of the
Political issues in inland waterways port development:
American transport industry. While many of the details still remain to be worked out, an element appears indisputable: the costs involved in such an endeavour require the practice of a continental solidarity. Given these inadequacies, it is suggested that the concept of the port transition needs to be positioned within a new paradigm of the regional economy of ports. This would include: (1) an understanding of institutional structure and how they reflect tendencies in port development; (2) an investigation of regional flows, particularly the role of offshore, inshore and coastal traffic; (3) a sensitivity to the regional elements of the port transition; and (4) an appreciation of the role of the State in port development policies. Essentially, such an approach attempts to present political options for port development within specific countries.
Regionalizing port development The issues raised above are central to an understanding of the limits to port development. The major question must be whether ports can experience a structural transformation in their juridico-political framework that is associated with a new form of regionalization and the successful realignment of their strategies into regional economies during this transition. One way in which to make these processes clearer is to illustrate them through case studies. We wish to understand port policies in three major areas, namely Europe, East Asia and North America because we want to document and analyze the limits to port development under radically different conditions. The countries that are at the core of our research efforts are France, China and Canada. They have been selected because they do not share the same conditions or processes. Indeed, the major coastal and inland waterways of France are underused, while secondary ports continue to persist. Besides, France has a long history of State intervention in local and regional planning that has integrated the economic and physical needs of ports and their relative impact (Marcadon, 1988). China, on the other hand, is a country with very high demographic density where most maritime trade is handled by large ports, but where small and medium size ports fulfil very specific functions. Furthermore, in China, administrative and economic changes are influencing very strongly the functioning integrity of the port system (Vigarie, 1992). Finally, Canada is characterized by a vast territory with a low population density where maritime trade is essentially resource based. But, more interestingly, Canadian ports are administratively fragmented by a considerable variety of jurisdictions (McCalla, 1994). France The waterways of France have been highly influenced by a rigid model of bureaucratic State centrality that
C Comtob et al.
confers high regard to the development of a depersonalized control through public laws (Strohl, 1990). Ideological or political factors have had little influence upon this process. Centralized sectoral management and governmental direction, characteristic of the French public policy system planned the country’s water transport network and infrastructures. The State Plan provides the principal water transport policy directives. Basically it is a planning document that represents a set of priorities for financing and realisation. Through a large and complex body of administrative laws, it provides oversight, technical and policy formulation for France’s inland waterways and ports. In view of this, the steps engaged towards decentralization that have taken place in France since the mid-fifties must be interpreted as a process to formalize the mechanics of the Plan in the region through the regional transport master plan together with the possibility for some subsidy from a commission for land use and regional action: the Delegation a 1’AmCnagement du Territoire et a 1’Action Regionale (DATAR) rather than a true decentralization of autonomy and responsibilities. There are essentially two types of ports in France: the autonomous ports - a status granted in 1965 to six ports, namely Dunkerque, Le Havre, Rouen, Nantes, Bordeaux, and Marseille, where the State assumes 70% of infrastructural investments; and ports of national interest jointly managed by local Chambers of Commerce and Departments of Equipment, where the State assumes 40% of investments in infrastructures. The administration of the waterways infrastructures is under the authority of the Ministry of Transport. Since 1991, the application of regulations concerning the commercial exploitation of navigable waterways is under the jurisdiction of the Voies Navigables de France (VNF). VNF is responsible for the exploitation, the maintenance, the modernization and the extension of the network as well as the management of the public fluvial domain. With a total length of 8568 km, the French interior navigable waterway system has been able to profit from the most important inland waterway systems of Europe. But it is marked by five major characteristics. Firstly, 60% of the navigable waterways are located north of a line linking Le Havre to Mulhouse. This area accounts for one of the most urbanized and economically prosperous regions of France. Secondly, the network is of unequal capacity. Many of France’s rivers and canals are commercially exploitable. But very few are of European scale class (over 3000 tons) and can thus be considered as having long-term prospects of commercial viability. Only the Dunkerquevalenciennes canals, the Moselle, the Rhine, the Seine, the Rhone rivers and the estuaries of the Loire and the Garonne are of European scale class. As a result, the European scale class carries 90% of the waterways traffic volume (tons) and 95% of the waterways traffic turnover (ton km). Thirdly, of these large-scale inland waterways, only the Dunkerque259
Political issues in inland waterwaysport
development:
C Comtois et al.
Valenciennes canals, the Moselle and the Rhine rivers are connected to other European waterway systems. As a result, these waterways serve a transit function. Figures demonstrate that 30% of the exchange traffic tonnage with Germany is undertaken by waterways. This figure increases to 44% with Belgium and the Netherlands (Strohl, 1990). Fourthly, many river ports such as Le Havre, Rouen and Paris along the Seine, Dunkerque and Valenciennes in the north, Strasbourg along the Rhine, Lyon along the Rhone are directly accessible by fluvio-maritime ships from other European countries or even North Africa. But many of these waterways are either isolated or linked to one another through small scale canals. Inter-basin traffic is not preponderant. As a result, France’s commercial waterway traffic is essentially single basin oriented. Studies and government reports published in the late 1980s underline the need to create inter-basin linkages of European scale class (Boussuge, 1990). Therefore, the localized traffic density of canals of European gauge, coupled with service fragmentation, has led to a reduction in inland water traffic. The implementation of policy decisions to improve the role and the share of inland waterways in the country’s commercial activities thus becomes very complicated. Fifthly, another important factor is that the waterway fleet of France is largely composed of separate business enterprises operating single barges. It is the owneroperators that own the majority of self-propelled boats. French politics have protected the owner-operator of the individual boat from competition not only with the fleet owners that are usually more capital intensive, but also from other owner-operators. This strategy however will need to be carefully re-examined. The abolition of international boundaries will not only reduce national administrative protection, but will introduce the prospects of having part of the traffic being diverted to eastern waterway vessels that could be highly competitive on a commercial basis. In 1995, acknowledging that the port and water transport geographic reality was marked by organizathe French authorities have tional deficiencies, mandated VNF to link four major fluvial arteries: (1) the Northern Seine linking the Seine, the Oise and the Northern canal; (2) the Rhine-Rhone between Niffer and Saint-Jean-de-Losne; (3) the Eastern Seine between the Seine and the Moselle; and (4) the Moselle-Saone permitting to integrate the network (Marcadon, 1996). One of the first impacts of this public initiative has been the emergence of regional port alliances. Hence the ports of Lille and Paris are carrying out a uniform program of development, while the ports of ChPionsur-Saone, Macon, Villefranche and Vienne have merged with a view to create a regional port authority: Aproport.
China China is officially a centrally is formulated by the Chinese 260
planned economy. Policy Communist Party and the
Central Committee through five-year plans, that embody the socio-economic development of the country. The country is now in the first phase of its ninth five-year plan (19962000). Water transport is under the responsibility of the Ministry of Communications. The Ministry manages directly 15 major seaports, two coastal shipping lines, China Ocean Shipping Company (COSCO) and the main stream of the major waterways. But it must be underlined that even at the height of the centrally planned economy, neither the individual’s choice of means of transportation nor the desired amount of water transport within the country were restricted by the State. While decision making in rail, pipeline and air transport is highly centralized, all levels of government have a role to play in the decision making process related to the water transport sector (Yenny, 1990). The central government concentrates on major infrastructural projects, while the local and provincial governments are responsible for inland waterways. Most of the extensive water transport systems, including infrastructure and equipment and their operations, are managed by provincial and local authorities. But recently, more flexibility has been introduced into the very rigid and bureaucratic system. A decentralization process is taking place in China where more autonomy and responsibilities are being granted to major seaports and shipping companies. Besides, the reforms have allowed villages, household or private owners to operate on a free market basis. This process however is much more conjectural than structural as it fails to consider the meso network of Chinese inland waterway ports. China has a long water transport history and the detailed analysis of the growth of the country’s waterway network and shipping industry has been well studied (Leung, 1981; Comtois, 1990; Comtois et al., 1990; Song, 1990; Sletmo and Boyd, 1993). These authors have demonstrated how the development of marine infrastructures is conducive to participation into the world economic market. Two points appear neglected however. Firstly, the 1983 administrative reform undertaken by the central government changed the traditional province prefecturecounty hierarchy to that of province-citycounty hierarchy. As a result, there are now four types of administrative division conditions occurring in China: (1) a strong leading city surrounded by poor counties; (2) weak or poor city and counties; (3) strong city and counties; and (4) a weak leading city surrounded by strong or wealthy counties. In the first case, the reform could have a positive impact since the city assumes the role of growth pole. The second case does not represent much of a change from the prereform era. The administrative entities still rest their development on self autonomy. In the third and fourth the reform has brought severe cases however, competition between the city and its surrounding counties. The city leading county system has had negative impact on port development. Indeed, in the
Political issues in inland waterways port development:
third case, since the economic structure of city and county are very similar, monopoly policies are being promoted or even implemented. As a result, the catchment areas are very small. These administrative units will distribute much, but over a small territory. In the fourth case, since cities are developing at a slower rate then their surrounding counties, they have their own incentive for economic growth. Cities will often prefer to develop their own administrative area to the detriment of the counties under their jurisdiction. As a result, many developments that could or should have occurred in the counties are now occurring in the cities. This is particularly verifiable with regard to ports. Indeed, if a city has a facade on the Yangzi river, it will attempt to develop its own port. This has even led to the development of unnecessary port infrastructures. There is thus a very intensive competition between small and medium size ports on the Yangzi river. These were traditionally national or provincial ports but the tendency is towards city-based ports. This system will not only have an impact on urban development but will hinder the comprehensive development of the Chinese port system (Comtois and Foggin, 1996). Secondly, Chinese ports are classified under four categories: inland waterways ports, the Yangzi river ports, the coastal ports and the ocean oriented ports. Inland ports can be planned by local administration, while the Yangzi river ports are designed by the Yangzi River Water Transport Bureau and the Ministry of Communication. But this classification is somehow simplistic as some inland ports also handle ocean shipping. More importantly, the recent changes in the port management system are not uniformly applied. Of all the 15 ports under the responsibility of the Ministry of Communication, only the port of Qinghuangdao is totally run by the central government. All the others are jointly supervised by the central and the provincial governments or between the provincial and the local governments. The small ports are managed by the local governments. Moreover, in many cases, rights and responsibilities have been transferred to the port authority. The port authority thus possesses the port assets and has considerable power over the organization of distribution of berths and over the establishment of handling companies as subsidiaries. The port authority can thus fix its own agenda and development plans that are not coordinated either with the city plans or those of the Communication Ministry. The apparent jurisdictional hierarchy is therefore blurred by the fact that there is still a clear division between entrepreneurial and political management. The problem is exacerbated by the fact that each administrative unit has its own freight station and shipping company. Many ports have their own transport company. On the Yangzi River, there are presently more than 800 shipping companies. Besides, private ports are being implemented. But all the ports on the Yangzi river are feeder ports for Shanghai. It would be impossible for any one of them
C Comtois et al.
. to become a major port. All this points to a water transport organization that responds in an anarchic way to the sudden increase in demand. This leads to: (1) a modification of port distribution, (2) a redistribution of catchment areas for ports, (3) an overcapacity on waterways, and (4) a surplus in handling capacity for water transport. Given the increasing growth of container movement, there is an urgent and mutual need for ports to consider the strength of linkages and promote the development of a regional network. Canada Public responsibility for the management of inland water transportation in Canada is extremely complex. Domestic maritime transport activities in Canada are defined as marine cargo traffic between Canadian ports. These activities are divided into five sectors: the inland waterways which comprise the Saint Lawrence-Great Lakes system and all the shipping activities occurring in the rivers and lakes located in Canada; the coastal activities of the Atlantic, the Pacific and the Arctic ocean and the MackenzieGreat Slave Lake systems. Two important features of Canada influence the country’s water transport policy. Firstly, the federal character of Canada, where the basic organizations of government levels can possess a considerable degree of autonomy, and secondly, the size of the country which constitutes a primary obstacle to the country’s integration. These two facets account not only for the basic characteristics of water transportation policy but also for many problems faced in other policy areas. Several administrative reforms have been adopted and vigorously implemented since the founding of the confederation in 1867. Despite many modifications to the port system of the country, the problem has remained the same: organizational linkages tend to be horizontal, across jurisdictions, rather than vertical. Within the dual federal and provincial hierarchical system, there is no unified central administrative bureaucracy ultimately responsible for the inland waterway system. Policy making is exercised by several technically oriented agencies. This fragmentation is further compounded by Canadian federalism which reproduces many counterpart agencies at the provincial level. As a result, water transport policy is scattered among very diverse administrative units that each exhibit particular legal, financial and operational norms and procedures that are not fully coordinated by a single political actor. On the Saint Lawrence system alone, there exist six different types of administrative agencies, corporations, commissions or ministries that perform maritime or port activities. Funding and operation of ports are divided among the levels of governments and the private sector. Therefore, port infrastructure investments are not necessarily complementary to the national system. Small ports finances have been adversely affected by a politically motivated investment policies. The public corporations with
Political issues in inland waterways port development:
C Comtois et al.
government capital participation and oversight have added to the politization of ports. The special status given to some ports proves to be problematic. Some ports have a special responsibility for providing transportation services to the general public. But this situation leads to demands of services and investment without any thought given to the ports’ financial health. There is thus a lack of balance within the Canadian port structure because each port administration and agency has evolved as a function of their own politicaladministrative dynamics. Many policy decisions have been aimed at correcting this imbalance. But coordination requires major initiatives coupled with a maintenance of funding. With large internal debt contributing to a serious economic crisis, the Canadian government has not been able to sustain such a system. Throughout most of its history, transportation in Canada evolved as a function of the economic exploitation of the land’s potential. The points of origin of the most important cargos, the raw material hinterland in Alberta, Saskatchewan and Manitoba for instance, have fostered the development of transport corridors. Many port investment projects were thus driven by the country’s mineral export policies. Furthermore, given the sporadic ecumene of large areas of Canada and the need to integrate the whole country, the national government was forced to subsidize many of the ports and water transport in remote areas. In 1996, the federal transport ministry presented a bill to modify the government operational role in the maritime sector by proposing to withdraw from direct exploitation while maintaining commitments with regards to transport safety, environment and services to remote communities. Under the proposed legislation, of the former 607 ports accounted in Canada, only 60 will remain under the jurisdiction of the Ministry of Transport, 245 will be turned over to local and regional authorities, eight major ports will be established as local commissions, 59 will be transfered to the fishery department, 200 will be declassified and the remaining 35 will be under private, municipal or provincial jurisdiction. These changes in the administrative structure of the Canadian port network are the result of thorough analysis in inland waterways trade flows. Despite the magnitude of the country’s extensive water network, over half of the domestic marine cargo was handled within Canadian inland waters, essentially on the Saint Lawrence-Great Lakes system. Of these inland areas, the national government concentrated on the construction or modernization of ports along the Saint Lawrence. These new ports have been designed for specific products and have been equipped with the But these fluvial navigation latest technology. improvements were following rather than leading other economic activities. On the Saint Lawrence river system, freight volume accounted for 110 million tons in 1995. The traffic of international marine cargo reached 72% during the same period. 262
Recent discussions and policy options presented to the national government suggest major transfers of water transportation responsibilities to the provinces and municipalities, the privatization of the marine services and the adoption of the principle user pay. Because of the geographical situation of the waterways, this decentralization and deconcentration processes will not change the performance of the water transport sector unless Canada adopts the principle of subsidiarity by identifying services to the water transportation industry that the local organizations can perform more effectively in terms of responsibility, capacity and efficiency than the dominant central organization.
Policy options for regionalization
of ports
There is a vast scientific literature demonstrating the positive aspects of inland waterways. Very briefly, waterway systems consume the least amount of energy per ton- km as compared with the other modes of transport, and the ton- km cost for waterway transportation is very low. As a result, waterways are most apt to be used for bulk commodities, some agricultural products and construction materials. In some areas, waterway services are absolutely required for the continued economic health of many outlying areas. Moreover, waterway traffic is environmentally more favourable than competing modes. Finally, ever increasing freight traffic on highways that results in congestion lends support to a renewal of waterways. Besides, it must be remembered that some highways continue to operate at a deficit, with the likelihood that shortfalls will become proportionally large over time because of the increased maintenance costs. The above highlights the important role played by national government in the development of inland waterways and the port system of France, China and Canada. In these countries, there is a commitment to a mode of transport that only contributes marginally to the economy. But the inland waterways sector with its considerable economic implications and ramifications reveals itself consistently across the case studies, as a weak point in the transportation structure of each country. This is the more surprising since the opportunities for the State to influence supply and demand in that sector have been considerably broadened with increasing trade opportunities. We have also shown the limits of national policy responses to the demands of changes and and technological the economic imperatives of ports. Policies have been initiated in response to expressed needs to improve upon an existing policy or to improve upon the operation of the service that the existing policy provided always upon a background of changes and rising expectations. The results of this situation are that the general scarcity of investment resources has stood in the way of a speedy, uninterrupted and comprehensive modernization and
Political issues in inland waterwaysport development: C Comtois et al.
expansion of traffic and fleets of the water transportation systems. Much points to the fact that planning for port as well as commitment of investment resources for the past years has been oriented towards short-range development. If inland shipping and ports are to achieve greater significance, then new canals must be built, networks in industrial areas must be expanded, shipping fleets must be modernized and inland ports favoured. The main question is what will it cost and who will pay for it? Faced with increasing pressures to provide fresh investments, national authorities have responded either by massive privatization or by strengthening public ownership. We suggest that a significant increase in the capacity and efficiency of the water transport system can be realized through another alternative in port planning, namely regionalization. Traditionally, maritime transport has helped the construction of regional territories, and in turn, regional territories have been at the source of maritime demand. Much research has been undertaken on the relationship between maritimization, the process of developing maritime trade, as coined by Guillaume (1996) and regionalization. But the standardization of freight handling, the geographical discontinuity of different elements, notably the tertiary service sector in maritime transport and the limits in port complex in polarizing economic activities both sectorally and spatially have considerably altered the mutual fertilization of regions and maritime trade. We therefore propose three issues to animate the relationship between ports and regions. Firstly, port regionalization will be successful if it is included within a market economy framework of competition. Regionalization must become a means for increasing responsibility of regions. It is thus within this context of responsibility that regionalization must be evaluated. The responsibility for the functioning of each port or group of ports operations must be assigned to a region that would be responsible to animate its port system within the whole country. The carriers and the forwarders of commodities are often located outside the port area. But by adopting a regionalization approach, the functions of ports would then be modified so as to consider the environment within which they operate. This would firstly permit to internalize within the region the externalities generated by the ports; secondly, reduce the cost of transactions through complementarities generated within the region; and thirdly increase the exchange of information between forwarders and carriers within the region thus rendering the ports more competitive. The realization of an optimal port system is discouraged by frequently changing orientations and guidelines which alter, abolish or reverse previous ones, hence confirming the need for the creation of regional markets. The new structure reflects the importance of developing comprehensive and efficient policies in the areas of international and regional local transportation and freight
distribution. The reorganization of various levels of transportation administration into regional transportation bureaus emphasizes policies based on a more objective assessment of needs rather than the vertical or individual systems which have led either to an inefficient and uncontrolled use of public resources or to unnecessary duplication of investments for the development and expansion of ports and water transportation systems. Secondly, the size of the region must allow the regional authority to have the capacity to solve problems. There is no ideal size of region, but the size must be small rather than large and must rest on spatial proximity. This will play an important role related to maritime dynamics notably as a base for information exchanges, agreement on common objectives and collective process of learning between ports. Indeed, certain ports are more dynamic then others. But all ports located within a region could observe the secret of success, reduce the rate of decline or assist in the elaboration of initiatives of the other ports. More importantly, the size of the regions must be defined or composed of several types of ports so as to enhance the necessary competition required for successful accountability. The region’s port system must be sufficiently pluralistic so as to permit the participation of all types of ports. Indeed, a sectoral approach based on type of traffic for instance would not be appropriate for regionalization. There are very few sectors where scale economies can be achieved. Levels of expenses per port tend to increase rather then diminish with the size of regions. Revenue in turn is difficult to evaluate with the size of regions but recent work demonstrates that cost-benefit analysis exhibits certain weaknesses because the compatibility of results between different regions is not always available (Slack et al., 1993). A grouping of ports could lead to the separation of economically viable and non-viable services and thus increase pressure to eliminate the latter. But a thoughtful regionalization process could permit cross-subsidy. Profit making ports or routes could make up for losses in another port, services or routes. The main problem has and will be the lack of investment capital. The over-riding strategy should then be to determine funding level according to the level of traffic. Thirdly, what is needed is a total systems approach to transportation, one considering traffic demand in terms of regions, commodities and corridors, not just port by port, thus stimulating balanced regional growth. Of particular concern is the need to coordinate the water transportation improvements in big ports with secondary ports in the surrounding region. Many small ports bring a considerable support to the regional and local economy while not being located along the major liners route. The task of regionalization is to lower the level of subsidies and to achieve the greatest economic yield. Obviously, this process would influence the supply side of the market through incentives for market restructuring. To avoid 263
Political issues in inland waterways port development:
C Comtois et al.
chronic overcapacity in ports, a regionalization approach could reduce the number of ports. This could be achieved through a flexibility in the maintenance of a stable number of ports, a number that would initially be tied to demand. Given that performance is not measured by distance, but by density and volume, there is a need to emphasize high volume transportation improvements or quick turnover if small ships serving regional needs can prove to have comparative advantages over big ships. As a result, the remaining infrastructures would exhibit a high degree of modernity. The goal of capacity equilibrium at the regional level would be achieved. The regionalization approach would increase the coherence and reduce the cost of water transportation administration and through tight solidarity would increase opportunities for profit by increasing accountability. Opportunities thus abound for the cabotage sector to continue to play a major role in shaping the direction of economic development.
A new role for the state One must always remember that the proprietor of the transportation infrastructure, namely the waterways, still remains the national government. But the adoption of a regionalization of the port system raises interesting avenues in port policy decisions for the State. Given some regions’ low levels of competence in the areas of planning and development, the first task of the national government would be to provide training in port and water transportation planning with a view to facilitate the process of regionalization. This should include public relations and communication techniques, quality control methods, qualitative and quantitative data interpretation analysis and project management administration. We believe that such training would enhance investment planning processes. Secondly, given the major technological changes, the varied strategies of enterprises, the implementation of free trade agreements, it becomes necessary to develop networks, partnership, alliances and even acquisitions with carriers and forwarders located outside the region, acknowledging that economic integration does not respect political boundaries. Therefore, to avoid a fragmentation of countries into multiple disconnected regional territories, the State has to assume a second task, namely to reinforce complementarity relations between regions through reductions of investment barriers, free movement of transport services across regions and unification of rules, standards and certilications. This would foster the integration of regional port planning across national borders. A third task would be for the State to concentrate on investing massively and without hesitation on the development of containerization and on the information highway. Combined transport offers operational as well as managerial advantages, while information flow generates transport which in turn brings traffic. 264
A final task would be for the State to increase its responsibilities in developing economic, social and cultural exchanges, to assist in favourable foreign exchange position and to enhance the image of the country abroad.
Concluding remarks The waterway transport and port policies are exhibiting the appearances of undergoing fundamental changes. The highly centralized model is no longer thought to meet the values and needs of the system, neither is the privatization approach. There is thus a need for a shift in the present institutional and jurisdictional structures of port systems. The option suggested here rests on the need to consider port regionalization in future water transportation policies. This approach however must not be interpreted as a panacea for all difficulties facing port systems. Some ports will have to be closed down while other berths will have to be built. It is not immediately apparent whether the regionalization of ports mentioned above will lead to further growth of the world trade. Two scenarios are imaginable. In one scenario port regionalization progresses in such a way as to complement the globalization of business activities. In another scenario part regionalization stratifies the global trade system. It is expected that maritime countries in Europe, East and Southeast Asia and in North America will discuss the conditions and procedures required to adapt their port system in relation to the maintenance and improvement of world trade. In this context, it is imperative for these countries to understand that the purpose of port regionalization resides in the qualitative improvement and quantitative expansion of the port system at home. In view of this, the paradigm of regionalization certainly deserves to be closely examined. This research was undertaken with the financial support of les Fonds pour la Formation des Chercheurs et 1’Aide a la Recherche, programme soutien aux equipes de recherche, Quebec and the Social Sciences and Humanities Research Council of Canada.
References Boussuge, A. (1990) Le transport fi’uvial en Prance. Office national de la navigation, Paris. Chilcote, P. (1988) The containerization story. In Urban Ports and Harbor Management, ed. M. Hershman. Taylor and Francis, New York, pp. 125-145. Comtois, C. (1990) Transport and territorial development in China, 1949-1985. Modern Asian Studies, 24(4), 777-818. F. and Rodrigue, J. P. (1990) The Comtois and , C., Soulard, Canadian foreland of Chinese ports. Journal of Oriental Studies, 28(2), 167-187. Comtois, C. (1993) The restructuration of transportation in China: the emergence of a new transactional environment. Publication No. 946, Centre de recherche sur les transports, Universite de Montreal, Montreal, 25 pp. Comtois, C., Slack, B., Lagimoniere, L. and Vallec, D. (1993) Role et la fonction des ports de petite et moyenne taille dans le systeme Saint-Laurent. Les Cahiers de geographie du Quebec, 37(100), 17-33.
Political issues in inland waterwaysport Comtois, C. and Foggin, P. (1996) La transformation des ports secondaires dans le delta du Yangzi. Cahiers Nantais, 46,99-l 15. ECIS (1994) Proposal for a Council and European Parliament decision on community guidelines for the development of the tram-European transport network. European Centre for Infrastructure Studies, Bruxelles. Fremont, A. (1996) L’espace maritime et marchand: pour une problematique. L’espace geographique, 3, 203-213. Goss, R. 0. (1979) Comparative Study of Seaport Management and Administration. Government Economic Service, London. Goss, R. 0. (1990) Economic policies and seaports: are port authorities necessary?. Maritime Policy and Management, 17(4), 257-271. Guillaume, J. (1996) Quelques re!exions sur les relations entre regionalisation et maritimisation par les transports. Seminaire de I’URA 904: Transports maritimes et ports de commerce, Universite de Nantes, Nantes, pp. 14-15. Hilling, D. (1988) Maritime transport technology and the revival of B&in’s small ports. In Transport Technology-and Spatial Changes, ed. R. S. Tooley. Transportation Geography Study Group, Stokeon-Trent, pp. 79-107. Hoyle, B. S. and Hilling, D. (1984) Spatial approaches to port development. In Seaport Systems and Spatial Change, eds B. S. Hoyle and D. Hilling. Wiley, Chichester, pp. l-20. Ircha, M. C. (1993) Institutional structure of Canadian ports. Maritime Policy and Management, 20(l), 5166. Leung, C. (1981) Shipping and port development for modernization. In Development and Change in China, eds E. K. Y. Chen and S. S. K. Chin. Center of Asian Studies, University of Hong Kong, Hong Kong, pp. 127-143. Mayer, H. M. (1973) Some geographic aspects of technological change in maritime transport. Economic Geography, 49, 145155. Marcadon, J. (1988) L’avant-pays des ports franpais. Masson, Paris, 208 pp. Marcadon, J. (1996) Lesportsfluviaux et les voies d’eau de France, etat des lieux et perspectives d’avenir. Institut de geographie de l’universite de Nantes, Nantes, 10 pp.
development:
C Comtois et al.
McCalla, R. S. (1994) Water Transport in Canada. Format, Halifax, 259 pp. McGee, T. G. (1994) Labour force change and mobility in the extended metropolitan regions of Asia. In Mega-City Growth and the Future, eds R. J. Fuchs et al.. United Nations University Press, Tokyo, pp. 62-102. Rimmer, P. J. and Comtois, C. (1996) Transforming the Asia-Pacific’s Strategic Architecture: Transport and Communications Platforms, Corridors and Organisations. Department of Geography, Research School of Pacific Studies, Australian National University, Canberra, 25 pp. Slack. B.. Comtois. C. Laaimoniire. L. and Vallee. D. (1993) The econom>c impact of small and medium size ports. Publication No. 890, Centre de recherche sur les transports, Universitt de Montreal, Montreal, 23 pp. Slack, B., Comtois, C. and Sletmo, G. K. (1995) Shipping lines as agents of change in the port industry. Maritime Policy and Management, X3(3), 289300. Sletmo, G. K. and Boyd, G. (eds) (1993) Pacific Service Enterprises and Pacific Cooperation. Westview Press, Boulder, CO, 274 pp. Song, Y. (1990) Shipping and shipbuilding policies in the People’s Republic of China. Marine Policv. 1. 53-70. Strohl, M. P. (1990) France.. In’ International Handbook of Transportation Policy, ed. S. Akaha. Greenwood Press, New York, pp. 93-124. Vigarib, A. (1987) .&changes et Transport Znternationaux. Sirey, Paris, 206 pp. Vigarie, A. (1992) La longue marche de I’Asie orientale vers la mer. In Le Quart Nord-Ouest du Pacifigue, ed. J. Beaujeu-Garnier. Sedes, Paris, pp. 97-171. Wessel, A. E. and Hershman, M. J. (1988) Mitigation: compensating the environment for unavoidable harm. In Urban Ports and Harbor Management, ed. M. Hershman. Taylor and Francis, New York, pp. 253-287. Yenny, J. (1990) China. In International Handbook of Transportation Policy, ed. S. Akaha. Greenwood Press, New York, pp. 41-62. I
,
I
265