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The role of port performance in gateway logistics
Prof. Tae Oum, University of British Columbia, Canada and Prof. Jose Tongzon, University of Tasmania, Australia

Abstract
Globalization, economic integration and the continued rise of the Asian economies have presented tremendous business opportunities for the logistics sector particularly in those countries that can act as gateways. There are, however, certain requirements to become a successful gateway. One of these requirements is to have an efficient and cost-effective transport infrastructure. Seaports are one of the most critical components of this infrastructure as the bulk of international trade is carried by sea.

This paper aims to evaluate the important role of seaports by discussing the linkage between port performance and gateway logistics. The first section of this paper identifies the key components of gateways, and the nature of infrastructure and policy environment underpinning their transshipment and distribution functions. The second section analyzes the critical role of seaports in gateways and in this context proceeds to explain the importance of such factors as strategic location, efficiency and reliability, connectivity and shipping frequency and adequate infrastructure in the performance of gateways. The relative importance of these factors is further supported by the results of our recent survey among a sample of freight forwarders based in Southeast Asia confirming these factors as important determinants in the choice of gateway ports and pointing to port efficiency as the most important gateway port determinant. The third section discusses the linkage of port performance and gateway logistics based on previous empirical studies. The key aspects to port performance covered in these studies are efficiency, connectivity, quality of port infrastructure and degree of supply chain orientation. These variables are shown to have significant impacts on transportation, international trade and logistics. The last section presents the ranking of ports/terminals in terms of efficiency based on stochastic frontier analysis and DEA. It can be argued based on their relative rankings that there is a close linkage between port efficiency and gateway performance.

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