TCFP - Port economics, competitiveness and governance

Transnet National Ports Authority (TNPA) serves as both the landlord and the exclusive provider of port infrastructure and marine services across South Africa's eight commercial ports. TNPA operates as a division of Transnet SOC Ltd., therefore tariffs are regulated by the Ports Regulator of South Africa (PRSA), who adopts a rate-of-return form of regulation to annually calculate the revenue requirement for TNPA. The Tariff Methodology outlines how TNPA's tariff will be calculated, and determines the total revenue that TNPA may raise through these port tariffs. The study aimed to evaluate the accuracy of the RR methodology by recalculating the Authority's required revenue for FY2024/25 using adjusted input variables for the Regulatory Asset Base (RAB), operating expenditure (OPEX), cost of debt, beta and taxation expense. The findings from the five scenarios indicate that TNPA tariffs could be reduced, calculating a tariff decrease of 22% in scenario 1, and a 13% decrease in scenario 3. It shows that there is a rationale to enhance the RR methodology, to ultimately improve port competitiveness, economic efficiency, fairness for users, and maximise tariff benefits. 

The Panama Canal plays a critical role in global maritime trade. To balance business profitability and customer satisfaction, the Panama Canal Authority (ACP) has implemented sophisticated navigation regulations, incorporating market mechanisms such as reservations and customer ranking. These policies create complex trade-offs between efficiency, fairness, and revenue. This study develops a queueing-based equilibrium model to analyze the Canal's bulk arrival and bulk service dynamics, focusing on the effects of reservations and customer ranking. To overcome the analytical challenges of bulk queues with priority, we introduce a matrix-based approximation method for estimating waiting times. Our findings reveal that offering reservations without customer ranking neither increases' revenue nor improves efficiency, as it can lead to unused service capacity. Moreover, we show that the customer ranking mechanism primarily serves to satisfy high-ranked companies by granting them priority access, rather than enhancing overall profitability. The redundancy in service capacity for non-booking vessels might be designed to ensure fairness. These insights provide a quantitative foundation for evaluating transit policies and underscore the importance of balancing operational efficiency with fairness considerations in capacity allocation.

This paper presents a review of technology theories in port development, with a focus on adapting established technology theories to the port domain. As ports play a critical role in global trade and logistics, advancements in port technology are essential to increasing efficiency, sustainability, and safety. This review consolidates various theoretical approaches that have been applied to port technology research, including technology diffusion, innovation systems, and socio-technical transitions, examining their relevance and applications in port contexts. The study explores how these theories can provide a framework for understanding the dynamics of technological change within ports, from infrastructure development to operational systems and digitalisation. The paper also highlights the importance of interdisciplinary perspectives in analysing the interaction between technological innovation and port operations. Furthermore, it discusses how emerging technologies like automation, smart systems, and sustainable energy solutions are transforming port operations and fostering sustainable development. The paper offers valuable insights for researchers, policymakers, and port operators to understand and navigate the complex landscape of port technology evolution. 

This study examines the formulation of concession contracts through negotiations involving a landlord port authority and two terminal operators. In the initial stage, the three parties engage in contract negotiations, followed by a second stage where the terminal operators compete in cargo-handling volumes. We find that with identical marginal costs and reserved payoffs, the optimal contract is typically a two-part tariff or a unit-fee structure. However, with disparities in these factors, a fixed-fee contract may also be optimal, contrary to previous studies without bargaining considerations. Our analysis demonstrates that transitioning from no bargaining to a bargaining scenario tends to lower the port authority's fee revenue while increasing each operator's profit, unless minimum throughput requirements are imposed on asymmetric operators. However, the collective payoff of all parties does not increase if both operators are symmetric, although it could increase in the case of asymmetric operators. These findings suggest that bargaining over concession contracts may not universally benefit all parties involved, as it produces divergent effects on the port authority and operators. We also demonstrate the robustness of our findings by considering operators competing in prices and the port authority prioritizing social welfare.