CHINA MARITIME LAW NEWSLETTER
Vol. 2, No.3 - April 4, 2002
TOPICS THIS ISSUE:
- China-U.S. Maritime Transport Talks Held in Beijing
- Shanghai's Deep-Sea Water Port to begin Construction this Year
- Control of Chinese Ports Open to Foreign Companies
- Action needed to safeguard HK cargo hub position
- China's Ports Record Significant Growth
- Shanghai Customs Trial Use EDI
- COSCO Shipping to Raise Up to 960.7 Million Yuan in Domestic IPO
China-U.S. Maritime Transport Talks Held in Beijing
The Chinese and the United States governments held maritime transportation talks in Beijing between March 19 and 21, 2002.
The Chinese delegation, headed by Vice-Communication Minister Hong Shanxiang, and the U.S. delegation, chaired by the Administrator of Maritime Administration of the U.S. Department of Transportation William Schubert exchanged views on bilateral marine transport relations and issues of common interest. The Chinese side briefed the U.S. side on the International Maritime Transportation Regulations of the People's Republic of China, which came into force on January 1 of 2002.
China pointed out that the regulations are aimed to help meet China's WTO commitments relating to marine transport services and comply with the principles of openness, transparency and lack of bias. The Chinese government has introduced a number of reforms, which will assist market-oriented development and create more openness. The new regulations will play an active role in protecting fair competition, maintaining the international marine market order and safeguarding the interests of all parties.
The U.S. side said that China's explanations had made it easier to understand the new regulations and welcomed the changes made by China in order to work towards market-oriented legislation for the marine transport sector.
The Chinese side said it was hoped a delegation would be sent to Washington to obtain further information on marine transport legislation and relevant management practices in the U.S.
The two sides also discussed various issues, which have been of interest to both parties during their long period of bilateral maritime relations and agreed to further bilateral discussions on maritime transportation.
(Source: Chinabiz.org)
Shanghai's Deep-Sea Water Port to begin Construction this Year
This year Shanghai will pump 12 billion Renminbi (US$ 1.45 billion) into its ambitious plan of building an offshore deep-sea port. The port is to be built on two offshore islands located nearly 30 km offshore from Shanghai's southern coastal area. The first phase of the project will cost 100 billion Renminbi (US$ 12 billion) and is slated to be finished by 2010. The whole project is aimed to be finished ten years later, in 2020. Upon completion of the project, Shanghai will be the busiest port in the world.
In 2001, the city's ports handled 6.33 million TEU of cargo, a year on year increase of 12.8 percent. This number is expected to rise to 10 million in five years time, when 5 new berths are ready. In that case, the port's export and import trade will be around US$ 180 billion. When the first phase of the project is finished in 2010, the city's capacity will be 20 million 20-feet containers a year.
It is hoped the deep-sea port project, on the city's agenda for a few years already, will outperform other competitive Asian ports like those in Japan and South Korea. Currently, Shanghai has the largest port in China in terms of throughput. It aims for a spot in the top-5 of the world's biggest container ports by the end of this year.
The two islands are located in a deep harbor 27.5 km from the Mainland therefore the plan includes construction of a near 30 kilometer long bridge to connect Shanghai with the new deep-sea port.
(Source: Shanghai Daily)
Control of Chinese Ports Open to Foreign Companies
Foreign companies are now allowed to take majority stakes in Mainland China port facilities as of March 2002. Foreign investors are now also allowed to wholly own terminal facilities and their operating companies. The State Development Planning Commission made the announcement. Previously, China restricted foreign "water transportation" investment to less than 50%, which had caused problems to such port powerhouses as Hutchison Port Holdings. The new ruling is in line with general liberalization under the World Trade Organization.
(Source: Maritime Asia Net)
Action needed to safeguard HK cargo hub position
Hong Kong needs to take 'urgent action' to avoid losing its leading position as a major transport and logistics center to the Mainland's Shenzhen and Shanghai, warned Hong Kong's Economic Services Bureau in a recent report.
The Hong Kong government should among other things develop an integrated logistics policy, and create "logistics pipelines" (road, rail and boats links) to ease the movement of manufactured goods to the mainland, the study says. If no action is taken, Hong Kong will lose its existing leading position in both air and sea freight in the region.
In recent years, Hong Kong has faced growing competition from mainland ports, especially the ports of Shenzhen - with its cheap prices - and Shanghai, on its way to become a major logistics center and an even stronger competitor once the deep-sea port is completed.
The Economic Service Bureau commissioned the study on how Hong Kong can counter this growing competition last year. The study examined all aspects of freight shipping and cargo handling. The report was not intended for publication.
(Source: Chinabiz.org)
China's Ports Record Significant Growth
Chinese ports recorded significant cargo throughput growth for January and February, according to figures released by the Chinese Water Transportation Administration.
Total cargo volume reached 312.2 million tonnes during the first two months of 2002, up 16.3 per cent year on year and setting a record for the period. Foreign trade cargo volume reached 108.2 million tonnes, up 18.9 per compared with the year before.
The major Chinese coastal ports recorded cargo volumes totaling 235.5 million tonnes, up 18 per cent year on year. Of this, 99.4 million tonnes was foreign trade cargo, up 18.5 per cent. Shenzhen witnessed the fastest growth, 31.2 per cent, with Ningbo and Tianjin second and third.
China's inland ports recorded 76.7 million tonnes of cargo for the two-month period, up 11.2 per cent, of which 8.8 million tonnes was foreign trade cargo, up 23.4 per cent. Chaozhou recorded the fastest growth, handling almost 2 million tonnes, a growth of 123.5 per cent. Zhangjia and Changshu were the second and third fastest growing inland ports, up 49.9 per cent and 27.8 per cent respectively.
(Source: Maritime Asia Today)
Shanghai Customs Trial Use EDI
Shanghai Customs, which oversees China's busiest foreign trade port, reported that it is the first in China to use electronic data interchange (EDI).
Sources with the Shanghai Customs said that it would first try the technology in two areas from February 1 of this year, namely Songjiang Export Processing Zone and the Waigaoqiao bonded zone. It would then introduce the practice to other places under its jurisdiction.
Shanghai port handled US$120.5 billion worth of goods in foreign trade in 2001, up 10.2 percent year-on-year. It handled 6.33 million 20-foot (6-metre) equivalent units or TEUs in 2001, the fifth highest amount in the world.
(Source: China Internet information Center)
COSCO Shipping to Raise Up to 960.7 Million Yuan in Domestic IPO
COSCO Shipping Co., a unit of China's largest shipping company, said it plans to raise as much as 960.7 million Yuan ($116 million US$) by selling shares to domestic investors for the first time, to expand its fleet by half.
The Guangzhou-based company said it will sell 130 million denominated-denominated shares at between 6.68 Yuan and 7.39 Yuan each. The price will be decided Wednesday. Citic Securities Co. is managing the sale of the shares, which will be listed on the Shanghai stock exchange.
COSCO Shipping said it will use the proceeds to buy 13 new vessels, increasing its fleet to 38.
(Source: Bloomberg News)
Lehman Lee & Xu
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The China MARITIME Law Newsletter is intended to be used for news purposes only. It should not be taken as comprehensive legal advice, and Lehman, Lee & Xu will not be held responsible for any such reliance on its contents.
