Singapore’s cooperative undertaking with Japan’s biggest ocean carrier, Ocean Network Express (ONE), makes the tiny state a maritime powerhouse in the realm of global shipping.
The joint venture aims to operate four mega container berths in Singapore, making the country a major seaport for ONE’s services.
The said arrangement was the decisive component of the transaction in spinning out all of the world’s most important container shipping partnerships — attributed to over three quarters of the world’s container trade – to the island nation. More importantly, it has positioned the Port of Singapore ahead of its nearest competitors in Asia.
Alphaliner’s chief analyst Tan Hua Joo elaborated that the joint venture will connect ONE’s shipping volumes to Singapore, efficiently getting rid of the direct risk for THE Alliance shifting to Port Klang.
The PSA-ONE endeavor is scheduled to set operations in motion in the first half of 2020, immediately after industry watchdogs have given the green light. This deal enables Singapore to handle four million standard-sized containers a year – the equivalent of total annual throughput at some of the smaller ports in other parts of the world.
“In terms of alliance longevity, we should not expect a lot of additional merger and acquisition activity between the larger lines that would be disruptive,” said Andy Lane, Singapore-based partner of CTI Consultancy…..Most of the competing hubs are also pretty well utilized, which means they have limited spare capacity in which to grow their market shares. So Singapore appears to be in a very strong position for the next five or so years,” Lane said in a statement.
At present, the Port of Singapore is touted as the world’s top transshipment port – an intermediate stop for cargo on its way to another destination – and the second-busiest port globally, next to Shanghai.
While it is true that nothing sails smoothly for a long time in the shipping business, as one is always subjected to a variety of market dynamics, like oil price hikes, entry of larger vessels, shifting alliances, ambiguities in the global economy, and the never-ending risk of port competition – Singapore will definitely face all these with refinement and aplomb.
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