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Shippers bank on new routes to facilitate B'desh trade

Shipping cos find Far East routes feasible for them

Jasim Uddin Haroon | January 27, 2018 00:00:00

Shipping companies that connect Bangladesh with the outer world now look Far East for their fortunes especially as China as an economic superpower spurs the fastest international trade growth.

Explaining this paradigm shift in shipping business, sources concerned said this is comparatively a new route and will save both freights and time significantly, particularly as China is out on a mission to build up all modes of connectivity under its Belt and Road initiative.

And shippers believe it will save their lead time and help boost export.

Currently, two top global lines have already started plying between Bangladesh and China and another will set sails middle of February.

The latter will establish link with two more countries of the Far East -- South Korea and Taiwan -- in addition to the ports located south and east of China.

People at the shipping lines told the FE that vessels are trying for connecting Chittagong with different Chinese ports, namely Port of Shanghai in Shanghai, Port of Nansha in Guangzhou, Port of Huangpu, east of Shanghai, and Port of Shekou in Guangzhou.

Many shipping executives told the FE that Bangladesh-bound cargos lie idle at least 18 days in Singapore port for lack of vessels, leading to rise in the lead time.

They, however, see some challenges against continuing operations of the lines as exports from Bangladesh are thinner than imports. They argue that they will carry empty containers to make up for the losses.

As such, Pacific International Lines, a shipping company registered in Singapore, launched recently its services on the non-traditional route linking China.

They connect each week Chittagong seaport with some ports of China.

Bangladesh-bound cargoes from Europe, America and Far East countries usually reach Chittagong via Singapore and Colombo ports.

The loading and unloading of cargoes at the Singapore and Colombo ports and other sorts of delays increase the transportation time by around 45 days.

The newfound route will help save around 20 days as they will come direct to Chittagong port.

Hyundai Merchant Marine, a Korean-flag carrier, will launch its services from Bushan of Korea to Port of Kaohsiung, the largest harbour in Taiwan, and on Port of Nimbho of China-Chittagong route.

Ataul Karim, an executive director at Hyundai Merchant Marine in Chittagong, told the FE they will launch their services in February.

"The cargoes meant for Bangladesh are rising and that's why we have taken this move."

He said there are substantial investments in Chittagong and Dhaka by Korean entrepreneurs, including Youngone Group, and they procure capital machinery and other raw materials from Korea. "To my mind, this is completely a new route and facilitates the Korean entrepreneurs in Bangladesh and others."

Mr Karim further said there are also investments by Taiwanese in Bangladesh apart from import of some goods from Taiwan. "I think this service will facilitate the Bangladesh-bound Taiwanese and Chinese cargoes."

Abdullah Jahir, a senior official at the PIL Bangladesh, told the FE that this service is mainly supporting consignees/importers who are importing goods from China.

"It reduces cost as well as time for consignees/importers," Mr Jahir said.

MCC Transport, a regional specialist handling all intra-Asia containerised cargos for Maersk Group, is operating on the route for last few years.

A senior official at MCC in Chittagong told the FE that the trade growth with China is leaping up fast in recent years, especially on the back of some major infrastructure projects.

"We found it feasible and our vessels carry at least 2,000 twenty-foot-equivalent units on average each time," said one official at the MCC shipping firm.

He said many are now exploring China-Chittagong service as they also feel that this alternative route will also help reduce the hassle of feeder services.

The MCC official said they have made comparatively shallow-draught vessels for the route and they do not need feeder services anymore for plying this line.

On the other hand, a number of shipping firms told the FE that if they got enough gantry cranes in Chittagong port, they would press into service more vessels on the route shortly.

A shipping firm reduced its vessels on the route on grounds of damage to gantry crane in Chittagong port.

Bangladesh imports over US$10 billion worth of goods from China and exports less than $1.0 billion a year.

The global freights market is worth around $500 billion and freights relating to export and import by Bangladesh come to approximately 1.0 per cent to $5.0 billion a year.

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