Significant investments continue to pour into the construction of Chinese ports despite high growth in the past four years, but officials told the Xinhua News Agency recently that the sector shows no sign of overheating.

According to officials with the Ministry of Communications, the development of port facilities should come ahead of the national economy to a certain degree. Currently the handling capacity of China's ports is actually well short of meeting the demands.

On December 18, the Nantong Port in east China's Jiangsu Province reported that it had handled over 100 million tons of cargo, becoming the 12th docks to handle such a volume on the Chinese mainland. Already China has the majority of big world ports.

Shen Yihua, vice director of the water transport planning institute under the ministry's Transport Planning and Research Institute (TPRI), listed three difficulties facing Chinese ports: insufficient handling capacity, not enough large specialized docks and a shortage of deep waterways. He warned that a lack of port construction had bottlenecked China's integration into the world economy and its sustainable development.

In 2005 Chinese seaports had a total handling capacity of 2.52 billion tons but the actual transportation volume reached 3.38 billion tons. There's also a gap of over 15 million TUEs handling capacity. To solve these difficulties, huge investment is required.

Xu Guangjian, vice chairman of Public Management College of the Renmin University of China, attributed the problem to a shortage of appropriate facilities. He said there weren't enough large and specialized docks while smaller facilities were gradually being ruled out. Construction of ports was mainly driven by a national plan. However, since these facilities are now managed by local governments, robust market demands and consideration of political objectives become the main driving force. Xu warned that irrational investments required to be watched carefully.  

On November 16, the State Council which is the country's cabinet, approved a National Coastal Port Layout Plan. It clearly identifies the functions for different ports. It sets out the way forward for investment. For those ports not included in the plan, the National Development and Reform Commission and the Ministry of Communications will examine them and have the final word on their approval.

As outlined in the plan, the handling capacity of China's ports can meet the actual demand in 2010 and a balance between port development and economic growth can be achieved. By 2020, the ratio of handling capacity to transportation volume will reach 1.1 to 1 and the pace of port development will be slightly higher than national economic growth.

Wang Jinwen, a division chief in charge of port administration under the Water Transport Department, Ministry of Communications, said that the emphasis of port investment remained on the expansion of handling capacity. Only after that was improved, could investment be channeled into other sectors such as comprehensive services.

(China.org.cn by Tang Fuchun, December 29, 2006)