Sun, Jun 12, 2016 - Page 4 News List

Port congestion first test for Burmese government

Reuters, YANGON

Fishing boats pass in front of a cargo ship docked at the Myanmar Industrial Port in Yangon, Myanmar, on Thursday.

Photo: Reuters

Myanmar’s new government has been grappling with its first economic management crisis, as a weeks-long traffic jam of cargo ships at the nation’s biggest port threatens to scare potential investors away and choke off nascent economic growth.

The bottleneck at the dilapidated port was caused by a spike in demand for goods, as the opening up of the economy accelerates following a historic election win by Aung San Suu Kyi’s National League for Democracy in November.

“Because of the general growth of the economy, we are packed. The ships have nowhere to go,” said Ma Cherry Trivedi, managing director of Ayuroma International, an adviser to Myanmar Industrial Port, where congestion has been worst.

Myanmar boasts one of the world’s fastest growing economies, expanding at 7 to 8 percent in the years since the military relinquished direct control in 2011.

However, its main port has changed little since the end of British colonial rule about 70 years ago — emblematic of ramshackle infrastructure that could hold back the foreign investment Aung San Suu Kyi needs to live up to sky-high expectations and remake a country impoverished by decades of junta rule.

The number of ships docking in Yangon has doubled over the past decade and the number of containers has jumped fourfold, data show, clogging up inadequate storage space, overwhelming logistics systems and delaying deliveries.

“We bring in the steel, the cement, everything you can think of ... as infrastructure grows, which is the key aspect of any development in a country like Myanmar, you are going to see massive growth in imports,” Ma Cherry Trivedi said.

Western shipping lines are largely confined to a single creaking terminal within the port, because of reluctance to use other facilities operated by Asia World, whose majority owner Steven Law remains subject to US sanctions.

The tipping point into a crisis came when the port miscalculated the volume of incoming shipments before a three-week holiday in April, when the country largely shut down, shipping companies operating at the terminal said.

That meant up to 10 ships faced delays of as long as two weeks to have their cargo unloaded, causing the biggest jam the port had seen in modern times.

Industry sources said the holdup cost major shipping lines millions of dollars a week.

“There was no proper cooperation between shipping lines, container storage facilities and terminal operators. Chaos,” said Myanmar’s Chamber of Commerce secretary-general Aye Lwin, who was involved in efforts to resolve the jam.

Myanmar’s presidential office announced emergency measures in the middle of last month to tackle the congestion, including 24-hour port operation and customs clearance, and ordered daily reports from the ministers of commerce and transport.

Some of the biggest shipping companies, such as Denmark’s Maersk Line Ltd, dispatched their own specialists to help manage the situation.

By Thursday, the backlog had been largely cleared, Ma Cherry Trivedi said, although additional staff flown in by shipping lines remained in place, as did the emergency measures, to prevent cargoes piling up once more.

Tatsuya Ueki, managing director at shipping company MOL Myanmar, said the port infrastructure has not caught up with the economic development of the country.

“There’s no easy way out of this, but billions of dollars in the country’s development hinge on how aggressive the government is in solving the problem,” Ueki said.

This story has been viewed 2172 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top