Objectives

1. Egypt is located in the North East of Africa. It is bordered by the Mediterranean Sea to the North and the Red Sea to the East. Egypt has 15 commercial ports; of which, six overlook the Mediterranean and nine overlook the Red Sea. Egypt also has the most significant navigation channel in the world (The Suez Canal) that facilitates the transit of global trade. The Mediterranean region is characterized by high levels of competition between its container terminals to obtain a greater share of seaborne trade volume in the region. Despite the blend that Egyptian ports enjoy, none of the Egyptian ports/container terminals is among the Top 50 World Container Ports since 2011. In recent years, other competing ports in the Mediterranean region were among that list, like Port of Piraeus (Greece) and Port of Marsaxlokk (Malta). The Holding Company for Maritime and Land Transport (HCMLT), affiliated to the government has three container and cargo handling companies operating through four container terminals in the following Egyptian ports overlooking the Mediterranean: Alexandria, El-Dekheila, Damietta, and West Port Said Ports. The three companies (and the ports they operate at) face many challenges that affect their performance and financial results. The goal of this project is to study the reasons for the low performance of the three national companies and how they could maintain advanced positions among their competitors in the Mediterranean, and among the Top 50 World Container Ports. To attain this goal, two wider objectives will be achieved. First, assess the performance of the three Egyptian container and cargo handling companies and benchmark them among their rivals in the Eastern Mediterranean region. Second, identify practically-sound Port Demand Management (PDM) measures and transportation/port planning policies to support the three Egyptian companies, individually and combined under HCMLT, to maximize their market shares and potential as main foreign trade and transhipment players in the region in light of the rapid developments and severe competition in the maritime transport sector. As opposed to the traditional supply-driven approach to port planning, PDM aims at the first place at alleviating port congestion by influencing customers’ (e.g. shipping lines, shipping alliances, consignees, and/or cargo owners) port/container terminal choice behaviour (i.e. demand) without investing in additional system capacity (i.e. supply). The specific objectives of this project are as follows: 1) Conduct a literature review on the concepts of horizontal and vertical integration, their various types and forms, the main factors and conditions affecting port integration, and successful applications of these concepts worldwide. 2) Analyze the performance of Alexandria, Port Said, and Damietta Container and Cargo Handling Companies over a reasonable timeframe. 3) Conduct capacity calculations for the container terminals of the three companies including their infrastructure (berths, yards, etc.), superstructure (cranes, reach stackers, etc.), and analyze points of strengths and weaknesses of the companies ability to utilize their capacity. 4) Analyze the network of shipping lines calling Egyptian ports and the development of the handling volumes (shares) of these lines with the three Egyptian companies over the timeframe of the study. 5) Investigate the effect of planned container terminals (i.e. new projects) in Egyptian ports and the developments in competing container terminals/ports in the Eastern Mediterranean on the market shares of the three Egyptian container and cargo handling companies. 6) Identify alternative Port Demand Management (PDM) policies to support the three Egyptian companies, individually and combined, to maximize their market shares and potential in the region and solve congestion problems without the cost of new infrastructure investments. The challenge facing this project is the balance between the cost of horizontal/vertical integration (e.g. advantages granted to shipping lines, cost of inland transportation of goods, etc.) and the desired benefits from such integration (e.g. retain existing shipping lines and attract new ones to Egyptian ports, use idle resources, increase revenues, etc.). Upon completion, this project will offer a strategic plan for the Egyptian maritime transport sector utilizing the concepts of horizontal and vertical integration under the envisioned context of Port Demand Management (PDM). Although special attention will be given to the national container and cargo handling companies, the practical applications (i.e. policies and strategies) of this research will be scaled to tackle the congestion problem at the port-level. Potential success of this project and of Port Demand Management (PDM) as a concept stems from the fact that demand management; in general, has proven to be an effective way to reduce urban congestion worldwide [12-15].

Our Partners

Project Coordinator

Dr. Ahmed Osman Idris (PI)

Dean, MRCC

Mobile: 010- 99384898

E-mail: ahmed.idris@aast.edu

This Project is Funded by