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Building Shanghai International Shipping Center - practice and prospect

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Profound changes are taking place in global economic and trade patterns, presenting both opportunities and challenges to the shipping industry.

The Chinese government made the strategic decision to build an international shipping center in Shanghai in 1996, based on the overall situation of economic and social development.

This ambitious trans-century project has experienced two stages in the past 25 years.

The first stage was mainly characterized by infrastructure construction. Along with the development and opening up of Pudong District in 1996, the construction of the Shanghai International Shipping Center, with Shanghai as the center and Jiangsu and Zhejiang as the two wings, was officially launched. Since then, the Waigaoqiao Port, the Yangtze River estuary deep water channel, the Yangshan Deep Water Port, Pudong International Airport, and other major infrastructure have been built, laying a solid foundation for the development of the Shanghai International Shipping Center.

In the second stage, great strides have been made in both infrastructure construction and fostering a pro-business environment, with an aim to build an international shipping center with high concentration of maritime resources, sound shipping service, an enabling market environment, efficient modern logistics, and global shipping resource allocation capabilities.

In the past 25 years, the Shanghai International Shipping Center has developed significantly, and Shanghai ranked 3rd in the world according to the "Xinhua-Baltic International Shipping Center Development Index" in 2022.

The capacity of the port continues to grow. In 2021, Shanghai Port completed a container throughput of over 47.03 million TEUs, remaining the world's No. 1 for 12 consecutive years. It has also scored the highest worldwide based on the port connectivity index for 11 consecutive years.

Shipping enterprises and institutions continue to gather. Six of the world's top ten ship management agencies, 10 member societies of the International Association of Classification Societies, and 18 of the world's top 20 liner companies have set up regional headquarters or branches in Shanghai. International and national shipping institutions such as IMO MTCC-Asia, IMRF Asia-Pacific Regional Center, BIMCO Shanghai Center, China Ship Oil Pollution Damage Claim Center, and China Shipowners Mutual Assurance Association have also settled in Shanghai.

The shipping service sector continues to improve. Shanghai has become the center of the regional shipping insurance market, with hull and cargo insurance premiums totaling 4.565 billion yuan in 2021, second only to London and Singapore in terms of its international market share. New shipping arbitration services have been introduced, and Shanghai joined the ranks of the worlds top ten most popular seats of arbitration for the first time in 2021. The China Containerized Freight Index (CCFI) and Shanghai Containerized Freight Index (SCFI), released by the Shanghai Shipping Exchange, became the bellwether of the global container shipping market. Clarksons, Drewry, and other world-renowned maritime research consultancies have also opened offices in Shanghai.

The business environment for the shipping industry continues to be optimized. The World Bank's Doing Business 2020 report shows that China (with Shanghai weighting 55%) has moved up to the 56th in terms of cross-border trade, with Shanghai ranking the 5th globally among comparable maritime economies in terms of ease of cross-border trade. China (Shanghai) Pilot Free Trade Zone has taken the lead in the country in adopting the negative list for foreign investment access. Currently, except for domestic waterway transport, other shipping business has been opened to foreign investors.

The future of the Shanghai international shipping center

The world today is faced with transformations and a pandemic unseen in a century. Profound changes are taking place in global economic and trade patterns, presenting both opportunities and challenges to the shipping industry. Against this backdrop, Shanghai will promote an upgraded development of the international shipping center.

The construction of a shipping hub with a global network will be expedited in collaboration with other provinces in the Yangtze River Delta. Shanghai will continue to adjust the functional layout of the port area, promote the comprehensive development of the north side of the Xiaoyangshan Island, and strengthen the planning and preservation of high-quality shoreline. At the same time, while giving full play to the leading role of Shanghai Port, the city supports port enterprises to further coordinate operations in the Yangtze River Delta and along the Yangtze River through capital cooperation and information technology.

The cargo collection and distribution system will be upgraded to ensure its smoothness and resilience. Shanghai will make the Yangtze River estuary waterway more navigable and facilitate sea-rail transport by accelerating waterway construction multimodal transportation by strengthening the capacity of relevant facilities. Shipping enterprises in Shanghai are encouraged to expand line networks and increase schedules to other countries and regions in the world to secure the smooth flow of the logistics supply chain.

The shipping industry will become smarter and greener. The whole logistics industry chain will be more IT-based, and port operations more automated and digitalized. Shanghai will strive to build an open digital ecosystem for shipping and accelerate the launch of new management approaches, services and business models. The city will continuously improve shore power facilities, and advance the construction and conversion of electric ships, LNG-powered ships and hybrid ships. The regulations for air pollution control on ships in emission control areas will be strictly enforced, and the whole process of receiving, transferring and disposing of pollutants in Shanghai Port monitored and supervised in a better way.

The shipping service sector and its brand effect will be comprehensively elevated. By fostering shipping service clusters incorporating shipping with science and technology, finance, law, education, manufacturing, and tourism, the brand value of Shanghai shipping service will be enhanced globally. International transportation management will be more open and new supervision modes for ports introduced in order to create a stable, fair and transparent environment for shipping development. Shanghai will deepen international cooperation in shipping affairs, and actively participate in the development of international shipping rules to enhance its international influence.

A platform for exchanges and cooperation for global shipping and aviation—the North Bund Forum

In order to strengthen exchanges and cooperation within the global shipping and aviation field, promote sustainable growth, and better leverage its function as a bridge and link in global trade, in a bid to boost the healthy development of world economy and trade, the Ministry of Transport of the People's Republic of China and Shanghai Municipal People's Government decided to co-host the North Bund Forum every year starting from 2021. The first forum was successfully held last year. Chinese President Xi Jinping sent his congratulatory letter to celebrate its opening. More than 1,200 people including representatives from domestic and foreign government departments, international organizations, authoritative institutions, and leading enterprises and renowned experts attended the forum and related activities either online or offline.

The North Bund Forum 2022 will be held from November 22 to 24. With the theme of Green, Intelligent and Resilient Global Shipping and Aviation through Global Partnerships”, the forum consists of the opening ceremony and main forum, two parallel forums (International Shipping Forum and International Aviation Forum) and six thematic sessions (Safety and Cooperation, Salvage and Rescue, Digitalization and Intelligence, Green and Low Carbon, Justice and Arbitration, and Finance and Insurance). The forum will adopt the hybrid online + offline mode. Government dignitaries, executives of port, shipping, trade, finance, law, science and technology and other related leading enterprises, leading figures, academicians and famous scholars from authoritative research institutions and universities, representatives of the International Maritime Organization, International Civil Aviation Organization and other important intergovernmental and non-governmental organizations at home and abroad will be invited to deliver speeches.

It is believed that the views and exchanges during the forum will help to solve major issues currently faced by the global shipping and aviation industry and facilitate its inclusive and integrated development.