Preparing for 4 Million TEU Era
The open-air yard of Incheon Port, the gateway port for the Seoul metropolitan area is filled with rectangular containers that symbolize “Export Korea.” It is easy to find a container car running on a road near a port. Incheon Port handles 50% of the import and export traffic in the metropolitan area, but not many people know about it.
Incheon Port handled 3.05 million TEUs of containers (A one-TEU container means one 20-foot container) last year. The port hit the record in four years since handing two million TEUs in 2013. Three million TEUs a year is comparable to annual volume of a major port in the world. In addition, Incheon Port is a popular among foreign tourists to Korea as well as handles large container traffic volume.
Incheon Port, which is emerging as a hub for logistics around the West Sea of Korea, is managed by the Incheon Port Authority (IPA). Nam Bong-hyun, head of IPA, is so busy that he cannot catch the passage of time. Nowadays, as part of 'National Safety Assessment', Nam is working on safety checks on multiple facilities with the Incheon Port Facility Management Center and International Passenger Terminal. In early March, Nam flew into the United States for cruise port sales, cutting a deal to bring two world-class cruise ships to Incheon Port.
BusinessKorea met Nam Bong-hyun, the president of the Incheon Port Authority (IPA) committed to developing Incheon Port as a global port such as opening Incheon New Port and stabilizing its early operation, constructing a new international passenger terminal and Golden Harbor and developing sites around the port which can support the port.
Since the inauguration of the president, you have made meaningful accomplishments such as recording the world's largest container traffic growth.
The increase in container freight volume is attributed to the expansion of Korea's import and export trade volume. One of the roles of the IPA was to improve the port service system, such as revitalizing and stabilizing Incheon New Port and providing 24-hour logistics service with the goal of providing logistics infrastructure. In addition, Incheon Port is expected to make the top 40 global ports by achieving "annual trade volume of four million TEUs" by 2025. In addition, Incheon Port is preparing to grow into a tourism hub. To cite an example, Incheon Port temporarily opened a cruise-only pier (150,000 tons) for the first time to cope with the rapid growth of the cruise market in Northeast Asia. The new international passenger terminal is under construction and will open in the second half of next year.
A lot of changes were made in the IPA since the inauguration of the new administration. What do you think about them?
In order to implement the new government's national affairs, we organized a national task force team. Ports should be energy-efficient and smart, too. Therefore, the IPA worked hard to discover and develop new projects such as introducing new and renewable energy, building smart locks, and creating jobs. Of course, we are also striving to secure financial soundness through the sale of non-core assets. I think it was possible for the IPA to reach collective bargaining agreements for nine consecutive years without labor disputes as the IPO has a win-win labor-management culture.
The IPA reset the IPA 2025 Medium-to-Long-term Management Strategy in order to implement the new government’s tasks.
The promotion of Incheon Port’s logistics and marine tourism will proceed as management strategy with no change. We made an improvement to the existing strategy by newly applying main items of the government's national tasks such as the creation of decent jobs, the application and expansion of new port technology, and the creation of an eco-friendly port. The improved management strategy also shares value that the organization must have in order to achieve its vision. That is none other than “The PATH to World!!” Based on communications and cooperation to create new value for Incheon Port, we are pursuing management policies –- empathy-based communication, win-win cooperation and the creation of shared value.
What is the competitiveness of a cruise-only terminal close to its opening?
The cruise terminal is planned to be completed in October this year with two floors above ground and a total floor space of 7,364 square meters. The cruise-only dock is designed to be the largest in the country and capable of berthing the world's largest 225,000-ton cruise ship. In order to cope with a difference between the ebb and flow of the tide at Incheon Harbor, two mobile gangways that can adjust their heights were installed to allow passengers to comfortably move in and out. Also, we are planning to build Golden Harbor to allow tourists to use shopping centers, resorts, water parks among others near the cruise pier and the international passenger pier for foreign passengers in the future.
Would you tell us about the development of new complexes for ports?
Since the end of last year, we are developing complexes for the Incheon New Port, North Port (north), and South Port (A-am Logistics 2 Complex) in earnest. The complex for Incheon New Port will be constructed as an LNG freezing and cooling cluster (230,000 square meters). In order to preoccupy the cold chain logistics market, we will help companies in the complex secure price competitiveness by bringing in cryogenic cold energy generated during the LNG vaporization process at KOGAS’s LNG acquisition base adjacent to the complex, supplying it to refrigeration and cold storage warehouses, empowering companies in the complex to be environmentally friendly and prune cost. The construction of the North Harbor Complex (north) will start this year and be completed by the end of 2019. The South Port A-Am Logistics 2 Complex will develop and supply 560,000-square-meter Section 1 of the total area of 257,000 square meters first by 2021. It is expected that the development of such future port complexes will produce 590 billion won in economic effects and create 8200 jobs.
What is the core of the Incheon Port Development Plan 2030?
The core of the plan is redefining functions and improving logistics competitiveness according to the characteristics of ports. By repositioning functions scattered in each port, we will specialize ports’ functions and induce the reinforcement of competitiveness. Incheon New Port will be fostered as the center port for container logistics in the Seoul metropolitan area and South Port will pursued coexistence with cities through the construction of an import and export logistics complex or port redevelopment. Inner Port will be the driving force behind the promotion of marine tourism and the revitalization of old downtown areas and North Port will be fostered as a bulk-oriented port to continuously promote the industrialization of the Seoul metropolitan area.
What are your future focuses?
In order to prepare for a 4 million TEU era, it is time to develop new infrastructure such as a pier to handle freight volume. In order to overcome a supply shortage in the complex for the new port (Zone 1 of Phase 1), we will select companies to move into the complex starting in the second half of this year. In addition, we will strengthen our omnidirectional marketing for the diversification of routes and shipping companies, shippers, and forwarders. We are planning to expand Intra-Asia routes, focusing on strengthening our competitiveness in American routes and adding more ocean-going routes. On top of that, we aim to become a hub port for Northeast Asian marine tourism. Furthermore, we will secure the safety of passengers through building smart floodgates and beef up information security and privacy protection systems. Another key task is the integrated management of energy at harbors and the development of eco-friendly future energy."
President Nam pledged that he would do his best to grow Incheon Port into an international port and open up a new maritime era for Incheon Port and Korea.