Yangshan carrot-and-stick approach pays off

Shanghai, the world’s second busiest container port handled 2.3 million TEUs — containers — in August and 17.1 million TEUs in the first eight months, up 17.8% and 22.4% respectively for the same periods last year.

This tempo will at the very least be maintained and perhaps increased with the opening of the four-berth, third phase at Yangshan, probably by the end of this year.

When the first phase of Yangshan opened in 2005, the port authority forced carriers to move all Asia-Europe services from Waigaoqiao to Yangshan. Then it told Asia-South America services to transfer to Yangshan.

Then it increased container handling charges at Waigaoqiao by about 20%, creating a price advantage for Yangshan port. It also subsidized moving costs for shipping lines shifting to Yangshan.

These efforts have brought results, as the first and second phase of Yangshan terminals are almost full.