Singapore's Port Industry Sees Tailwind Despite Trade War Turbulence

Record High Container Throughput
MegaPort Scheduled for Partial Opening Next Year
Handling 6.5 Million TEU Annually at New Port

[Asia Economy Singapore Correspondent Seo Jumi] Despite the slowdown in international trade, the container throughput at Singapore's port reached a record high last year. This has further strengthened the construction of the mega port, which is scheduled for partial opening in 2021.

According to the Maritime and Port Authority of Singapore (MPA) on the 21st, Singapore's container throughput last year recorded 37.2 million TEU (1 TEU equals one 20-foot container), an increase of 1.6% compared to the previous year. Compared to 28.4 million TEU in 2010, this is a 31% increase. Additionally, the ship arrival tonnage, which measures the cargo carrying capacity of vessels, rose by 2.2% from 27.9 billion tons in 2018 to 28.5 billion tons. However, total cargo throughput slightly decreased from 630.1 million tons to 626.2 million tons.

Singapore's container throughput reached a record high because its status as a transshipment hub remains strong. Singapore aims to be a transshipment-focused port connecting Asia, Europe, and the Americas, rather than handling export-import cargo needed for production and consumption.

In particular, since 2015, Singapore has been developing a new container terminal site on a 387-hectare reclaimed land area in the western Tuas region. The new port construction project, called the "Mega Port Project," involves a total investment of 20 billion USD and is scheduled for partial opening in 2021. By 2040, the relocation of existing port functions will be completed. The transshipment function is expected to be further strengthened.

To build the port, Singapore reclaimed land equivalent to 3,800 football fields. The budget for land reclamation alone was 1.46 billion USD (approximately 1.2 trillion KRW), demonstrating a strong commitment to the new port construction.

Once the new port construction is completed, Singapore is expected to handle up to 65 million TEU annually, far exceeding the current maximum throughput of 40 million TEU. It will also be able to accommodate 24,000 large vessels. Additionally, since the previously scattered port facilities will be consolidated into one, economies of scale are expected to come into play.

However, local industry expresses concerns about the emergence of strong competitors, as China is conducting large-scale overseas port investments as part of the Belt and Road Initiative. Latecomers such as neighboring Malaysia's Malacca and Klang ports also pose variables for Singapore. Singapore's port business is closely related to South Korea as well. The Malacca-Singapore Strait, connecting Korea with Europe and the Middle East, is a route through which over 90% of Korea's crude oil imports and more than 30% of its import-export cargo volume pass. To enhance port competitiveness, Singapore is establishing a free trade zone without tariffs or trade restrictions and is also setting up a distribution center that provides comprehensive logistics services.