Governance

“Ports will become a driving force for the new economy”

Peter de Langen visited the Port of Barcelona for the second edition of the ChainPORT Academy, organised by the eponymous international network of smart ports and held at the Port of Barcelona late last year. De Langen has a PhD from Erasmus University in Rotterdam, worked in the Corporate Strategy department at the Port of Rotterdam Authority and has participated actively in various strategic development projects at ports in Europe and South America.

Posted on 06.14.2018

PierNext

Peter de Langen attended the last edition of The ChainPort Academy, held in Barcelona. [Image: Port of Barcelona]

We took advantage of the opportunity to chat with the professor and port strategy consultant on what role he thinks ports play in the circular, collaborative, sustainable economy, which the most advanced cities are starting to develop. For Dr de Langen, the port ecosystem should have four elements: a transport hub that integrates all modes of transport, not just maritime; an industrial complex that serves the region's needs in terms of raw materials and provides facilities to attract international traffic; a logistics hub that provides value-added services; and an area for tourism and leisure, as well as offices, with services for cruise and passenger traffic.

International sea transport is constantly changing, with the merging of the big shipping lines and, therefore, a concentration of decision-making centres. In your opinion, are ports successfully adapting to this situation of permanent uncertainty?

The maritime industry is always evolving and maritime business is adapting to the constant changes in the global economy. From now on, port development plans should be designed in conjunction with industrial, logistics and tourism clusters, as their activity will overlap more and more with that of the port. I believe that ports will become a driving force for the new economy that is arising in many cities, participating more actively in all sectors and getting involved in the transition towards the circular economy and sustainable growth.

How will this transition come about?

The key element behind this change is governance. The port landlord must be able to properly address the needs of clients, users and the organisation. This governance must be in the hands of commercial institutions with a clear view of what the port should be in the middle and long term. Institutions I call port development companies.

What sets a port development company apart from the traditional port authority?

For me, the mission of a port development company must be to develop the port ecosystem, which means it must be able to manage the physical space while also acting with a broader view, collaborating with and anticipating the needs of its hinterland. The port authorities, and similar management bodies that have worked fine so far, have managed the physical space without advanced business development processes. A port's success continues to be judged based on the volume of tonnes and containers it handles. This model will change to adapt to current economic and social changes. For example, port development companies will have to actively work to attract talent in order to incorporate technological solutions into their management model. Ports will ally themselves with universities and attract start-ups and companies working in innovation and technology applied to the port and maritime business. Likewise, they have to actively communicate this commitment to innovation to various audiences: clients and users, logistics operators, shipping lines, etc., but also to the industrial and social arena, so they all become partners, companions on the journey towards this transition.

How will this change come about and who will be involved?

The change must involve all stakeholders in port business for it to be successful. Some companies in the port and maritime sector are endangered species, while other are evolving successfully. But I'm very optimistic about the sector as a whole. There are logistics service providers, like Kuehne Nagel for example, that are posting notable growth because they have developed services that give their clients value added.

The Port of Rotterdam has started its energy transition to reduce the use of fossil fuels. [Image de Sascha Hormel]

Which ports have begun this change? Rotterdam, which is committed to promoting an energy transition to limit its dependence on fossil fuels and its emissions, is one of them. This port is currently working on generating heat with its own resources and those in the immediate surroundings, which is a radical departure from the classic concept of port activity. The Port of Barcelona is also working to reduce its pollution levels and become a sustainable port. Barcelona has got out in front of other nearby ports with initiatives in ICT solutions, logistics activity zones, inland ports, etc. In fact, the Port of Barcelona is a good example of the transition towards a port development company. The port ecosystem benefits from being located in a highly innovative city with the ability to attract start-ups and cutting-edge companies. Now is the time for the Port of Barcelona to base its growth on technological solutions that make the most of the area's huge potential. It needs the whole port community to interiorise this open viewpoint and this willingness to change, which will make it easier to anticipate the challenges of globalisation.

What role will ports play in 30 to 50 years? That's a great question! As I've said before, so far ports have measured their success by volume of traffic. A port generates revenue from the traffic that passes through its docks and, therefore, its main concern has been to boost this traffic. Managers have to move beyond this way of working and take a broader view of how to develop the port ecosystem. Ports have to start working and investing with the sustainability of their whole hinterland in mind; environmental, economic and social sustainability, so that the rest of the stakeholders in the circular economy will choose to work with them.

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“Ports will become a driving force for the new economy”

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