Singapore's US$40 billion Tuas to double port capacity

AS congestion clogs global supply chains, the Port of Singapore is pursuing an ambitious plans to provide a massive injection of automatic container handling capacity, reports Bloomberg.


Facing rising competition from rivals such as Shanghai, Singapore began allocating funds in 2013 to reclaim land needed to build a new port called Tuas.


Singapore is now forging ahead with a US$40 billion project to build the world's biggest automated port by 2040 - one that will double the existing space and feature drones and driverless vehicles.


The city state started operations at two new berths last year, and construction work is continuing on the next phase.


Ports are the most visible choke points in the US$22 trillion arena for merchant trade, and a long-overdue transformation will require tackling a host of problems.


Docks are constrained by fading technology and limited space, while inefficiencies are compounded by containers piling up at yards and a short supply of workers and trucks.


Located on the Strait of Malacca, Singapore is a regular pit stop on container routes that connect Asian factories to consumers in Europe. The port, which handled the most transshipped cargo in the world in 2020, has come through the pandemic in better shape than most of its peers.


"Singapore is the world's biggest transshipment hub, a position it will hold for years to come," said Choi Na Young Hwan, head of the international logistics analysis team at think tank the Korea Maritime Institute.


Tuas will eventually double its capacity to 65 million TEU. The major investment has also taken place as other governments and companies have cut back.


London's Drewry Maritime Research expects about 30 million TEU of capacity will be added each year from 2021-2026, down 25 per cent from 40 million TEU added each year during the decade to 2020.


"Tuas capacity comes online while the industry is still challenged by shortages of port capacity," said Ocean Network Express (ONE) chief executive Jeremy Nixon.


Once Tuas is completed, Singapore will shut all its existing capacity and relocate everything there. The three city terminals at Tanjong Pagar, Keppel and Brani will all shut and move to Tuas by 2027, while Pasir Panjang terminal will be consolidated by 2040.


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Singapore's US$40 billion Tuas to double port capacity
Singapore's US$40 billion Tuas to double port capacity