Contents

Importance of Port in Korea

Port Development in Korea
Overseas Port Development of Korea
Cooperation with ADB

Contents

Importance of Port in Korea

1. Importance of Port in Korea

Korea had enjoyed the world's fastest growing economies from the early 1980
s to the late 2000s

Korea had been ranked world top 15th in terms of the size of nominal GDP in 2012
(Unit: billion dollar)

%
R: 4.9
CAG

1,200

1,115 1,129

1,049
951

1,000
845

800

1,015
931
834

722
644

600

531

%
14.6
:
R
G
CA

400
200
64

72

78

86

95

98 114

143

192

573

534

532
462

436

236

270

316

338

372

576
505

358

GDP

1. Importance of Port in Korea

The trade dependence of Koreas economy is constantly rising from 45.6% to 94.5
%(CAGR 4.1%p between 1994 and 2012)

Also, 99.7% of the international traffic volume was handled thru the port in 2012
(Unit: %)

100.0

120.0

90.0
100.0

80.0
70.0

82.3

60.0
50.0

63.0

40.0
30.0

96.9

92.1

45.6

49.0

48.9

52.8

57.1

62.4

66.2
57.8

54.6

64.6

66.8

94.5
80.0

87.9

69.4

60.0

57.9
40.0

20.0

20.0

10.0
0.0

0.0
1994

1995

1996

1997

1998

1999

2000

Shipping

2001

2002

Aviation

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

dependence upon foreign trade

1. Importance of Port in Korea

In order to keep the economy growth through trade, port is the key logistics no
de in Korea

Total port throughputs and GDP are highly correlated as 0.98

Total volume increased 8.2% annually from 99 million tons in 1981 to 947 million tons
in 2012

Busan New Port

(Phase 2-3)

(Unit: thousand ton, billlion dollar)

1,000,000

Busan New Port (Phase1-1)

Kwangyang Port (Jungma)

900,000

946,775

1,200
1,000

800,000

Pyeongtaek Port
(West)

700,000
600,000

800
517,210

500,000

600

400,000
300,000

400

241,496

200,000 98,952
100,000

200

Total volume(except liquid bulk)

Cargo Handling capacity

GDP

1. Importance of Port in Korea

Through sustainable port development, Korea has gained added value and vari
ous efficiency gains

Container throughput increased 10.4% annually from 2.5 million TEUs in 1990 to 22.6
million TEUs in 2012
Container handling capacity increased 13.3% annually from 1.46 million TEUs in 1990
to 22.9 million TEUs in 2012
(Unit:Thousand TEU)

25,000
21,268
19,369

20,000

22,550

12000

22,960 10000

15,216

8000

15,000
9,116
7,118

10,000
5,000

6000

10,473

4000

4,918
2,544
1,460

2000

2,420

0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
container throughput

Container Handling capacity

GDP

1. Importance of Port in Korea

The share of container transshipment volume out of the total container throughp
uts reached 37.7% in 2012 compared to 5.9% in 1990
Transshipment is the high value added logistics activity that values more than 1 billion
dollars(US$) per annum

(Unit:Thousand TEU)

25,000

20,000

15,000

CAG

10,000

R:

nt)
e
m
p
sshi
n
a
r
t
%(
20.1

8,498

14,052
5,000

151
2,393
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
import/export

transshipment

1. Importance of Port in Korea

22,708 Dollars as GDP per capita

Become a member of OECD DAC(2009)
Hold the G20 Summit(2010)
Reached over 1 trillion dollars as trade val
ue for the last 3 years

67Dollars as GDP per capita

Beneficiary Country of Economic Assist
ance

Port Development
Port is the key infrastructure to increase the efficiencies of international trading and Nations econom
ic growth

Contents

Port Development in Korea

2. Port Development in Korea

Port Master Plan of Korea

It is a National Master Plan for Port Development
Planned every ten years and modified each 5 years

Currently, 3rd Port Master Plan is applying until 2020

[Planning Process of Port Master Plan]

STAGE1: D
esigning Ma
ster Plan

Emerging needs for Port Development and Planning

STAGE2: Es
tablishing M
aster Plan

STAGE3: C
onfirming M
aster Plan

Increased demands for ports

Changes in shipping patterns (Increase of container usage)
Requests port development from Local residents and related agencies
Needs on Port development and basic plan writing

Master Plan and Feasibility study

Cargo Throughput Estimation, Site Selection, Technical Feasibility Study, Economic Feasibilit
y Study, etc.

Establish Port Master Plan(Minister approval) and consult with related agencies
Review and apply comments and discussions, confirm master plan
Consideration and decision of National Port Policy Council
Port Master Plan confirmation notice

10

2. Port Development in Korea

The Port Master Plan is being set up and promoted after considering the port logist
ics environment and the environment in the future as well

International logistics center, global port

Approachable Water-Friendly Port
Balanced development of regional port
Conversion from passive demand-met type to active demand-creative type
Sustainable port development and management
[Paradigm Change of Port Policy]
Multi Functional Port
(Quality Growth Strategy)

Cargo Handling Port

(Quantity Growth Strategy)

Waterfront related to
city function
Green Port low carb
on green port
See Sightseeing Infr
a

Import/Export Cargo
Simple Transshipme
nt Cargo
High Value added Tr
ansshipment

Efficient
usage of
port spa
ce

Logistics Port
(Quality Growth Strategy)

Create vol
ume, high
competitiv
-eness

Port Hinterland Co
mplex
Hinterland Industri
al Complex

11

2. Port Development in Korea

Promote the investments by private sector in Port development

Since the IMF crisis in 1998, switched to private investment projects

Regulated by Private Investment Law
All kinds of Private investment can be applied

BTO, BTL, BOT, BOO, etc.

From 2003 and 2011, the cumulated investment on port development by private sector acc
ounted 78.1 billion dollars
Operator
(Maintenance/Operation)

Investment
Investment

Construction Company
(Design + Construction)

Construction

Transfer the Owner

ship of Facility

Give an authority to
operate
Dividend/
Principle &Interest
Investment/
Loan
Give an authority to
manage & operate

Financial Sector

Government

12

2. Port Development in Korea

Procedures for Private Investment

[Government Notified Project Case]
Target Business Appointed by Government
Notification of Basic Plan of the Target Development by Government
Submission of Business Plan by Private Sector

Review, Evaluation and Selection of Preferred Bidders by Evaluation Body and Government
Negotiation between Government and Preferred Bidder
Conclude the Practical Agreement and Appoint the Business Contractor
Application for the Approval of the Practical Business Plan
Approval of the Practical Business Plan
Confirmation of Construction Completion

13

2. Port Development in Korea

Procedures for Private Investment

[Private Proposed Project Case]
Submission of Proposal(Private Government)
Request the Review of Proposal(Government Public Private Infrastructure Investment Management Center)

Report the Review Opinion(Government Public Private Infrastructure Investment Management Center)

Public Notification for 3rd partys Proposal

No
Appoint the Proposer as the Preferred Bidder

Yes
Review and Evaluate the Proposals
Appoint the Preferred Bidder

Negotiate & Appoint the Business Contractor

Approve the Practical Business Plan
Confirmation of Construction Completion
14

2. Port Development in Korea

[Major Private Investments on Port]

[Busan New Port]

Incheon port
-Steel pier(3)
-Multipurpose-ber
th(phase 2-1)

Pyeongtaek port
-inner ease pier
-Grain pier
- International Fer
ry Terminal

Pohang youngilman new port

-Container terminal (phase 1-1)

Gunsan port
-Gerneral cargo pi
er

Mokpo port
-Multipurpose-berth(p
hase 1-1,1-2)

Ulsan new port

-Container terminal (pha
se 1-1)

Gwangyang port
Masan port
-Container terminal (p -Multipurpose-bert
hase 3-3)
h(phase 1-1)

Busan new port

-Container terminal
(phase 1, 2-3,2-4)
- Hinterland Road

15

Contents

Overseas Port Development of Korea

16

3. International Cooperation Project on Overseas P

ort Development

Based on the experience of port development and economic growth, the intern
ational cooperation projects on overseas port development has been implemen
ting since 2008
Aim

to share the experience and knowledge with developing countries and improve t
he national image
Ministry of Oceans and Fisheries

Aid the feasibility studies of port development master plan

EDCF loan support of non-profit facility project
Provide a training program to the public officers related to port and logistics departmen
ts

17

3. International Cooperation Project on Overseas P

ort Development

Since 2008, 13 international cooperation projects were carried out

Currently, 4 projects are on going over the world

18

3. International Cooperation Project on Overseas P

ort Development

Project Procedures

Prior
Consultation

Verify cooperative intentions through Exchange of Formal diplomatic letters, Hi

gh-level interviews and set the range of cooperation
Prepare grounds to support Port Development cooperation between bilateral mar
itime departments by concluding a MOU

Conclude
MOU
Order & Perform
Tasks
Business
Conference
Commercialization

Open a public competitive bidding to Korean engineering companies for making

Feasibility study and Port Master Plan for the target port
Give Initiation Report of the Task Performance Plan, gather opinions through bu
siness meetings, final report to local government
Discuss recruiting investors, loan support, KOICA support after determining the
Project Promotion Methods based on the result of feasibility study

19

3. International Cooperation Project on Overseas P

ort Development

To increase efficiency and effectiveness of the project, the Korean governmen

t is planning to

Establish an institute named as International Cooperation Project Manag

ement Center

Develop an Evaluation Tool for two steps(pre & post)

Diversify the method to find a project

Especially, through with ASEAN, UNDP, MDB(ADB, AFDB, IBRD

), etc.

Expand the types of project from port development to port operation,

disaster prevention facilities, ocean plants, planning & designing, et
c.

Open a regular training program

20

3. International Cooperation Project on Overseas P

ort Development

Korea-Philippines Cooperation Project Case

1
Project Overview
2

Project period : 2011. 10 ~ 2012. 12

Project Objectives : Port Development Plan & Feasibility of the modernizatio
n of two ports(Iloilo and Cagayan de Oro)

Request intergovernmental cooperation through the Korea-ASEAN meeting

Cagayan de Oro (2030 basis)

Traffic: containers (6.7 million TEU), General (762 tons), passengers (21
2 million)

Development Scale: 5 berth & facility improvements

Total Project Cost: Approximately 133 million(US$)

Iloilo (2030 basis)

Traffic: containers (8.8 million TEU), General (736 tons), passengers (149 mil
lion)
Development Scale: 3 berths & facility improvements
Total Project Cost: 48million dollar(US$)

Project Finding

Project Results

21

3. International Cooperation Project on Overseas P

ort Development

Korea-Philippines Cooperation Project Case

[Location of Target Ports]

[Proposed Ground Plan & Birds-Eye View for Cagayan de Oro Port]

[Proposed Ground Plan & Birds-Eye View for Iloilo Port]

Iloilo
Cagayan d
e Oro

22

3. International Cooperation Project on Overseas P

ort Development

Korea- Cambodia Cooperation Project Case

Project Overview
2

Project period : 2012. 4 ~ 2013. 4

Project Objectives : Development planning for 3 ports that dedicates to grain
in order to revitalize the grain export of Cambodia

Follow-up project of Korea - ASEAN cooperation projects

3 Port (2030 basis)

Project opportunities

Project Results

Traffic: containers ( 1.4 million TEU), General (4.5 million tons)

Development Scale: 1 multi-purpose berths ( Phnom Penh New P

ort Phase 3), grain terminals(Tonle Bet and Kilometer #6)

Total Project Cost: Approximately 19 million dollar(US$) per po

rt

Economic feasibility : NPV (-60 ~ +126 billion), EIRR (at least

6.25% , up 14.13%)

Currently, looking for link plan with EDCF or ODA

23

3. International Cooperation Project on Overseas P

ort Development

Korea- Cambodia Cooperation Project Case

[Location of Target Ports]

[Proposed Ground Plan for Phnom Penh New

Port Phase 3]

[Current Situation of Target Ports]

[Proposed Ground Plan for Km #6]

[Proposed Ground Plan for Tonle Bet]

24

Contents

Cooperation with ADB

25

4. Cooperation with ADB

To increase efficiency and effectiveness of the project,

Hold a Regular Meeting to share the experience and knowledge about por
t and logistics development

Request for advisory comment on the project

Perform joint implementation

Request participation for the step Country Partnership Strategy / Region

al Cooperation Strategy

26