S'pore may spend S$10b on ports to regain position
SINGAPORE: Singapore plans to almost double its container port capacity after Shanghai overtook the nation to become the world's busiest harbor, part of Prime Minister Lee Hsien Loong's push for an economic and popular revival.
The plan may spur yearly growth of five per cent and port building costs could top S$10 billion (RM25.79 billion), said Vishnu Varathan, an economist at Mizuho Bank Ltd in Singapore.
The government is spending at least S$8.8 million this fiscal year on the project, which involves moving terminals to free 1,000 hectares for development and building a larger facility at Tuas in the southwest.
The country faces rising competition from neighbouring ports, greater congestion as its population is set to climb toward 6.9 million by 2030 and record property prices that add pressure for more homes on an island smaller than New York City.
The harbour plan shows the island isn't running out of space or potential, Lee said in August.
"It's out of necessity," said Irvin Seah, a Singapore- based economist at DBS Group Holdings Ltd.
"You don't want your business to spill over to the other ports. You want to strengthen this position as a trading hub in the region."
Lee's People's Action Party is trying to reverse an erosion of its electoral dominance amid unease about overcrowding and economic prospects, said Cherian George, an adjunct fellow at Singapore's Institute of Policy Studies. Growth in the US$275 billion economy hit a three-year low of 1.3 per cent in 2012.
The government said in the budget that it's allocating the initial project funds in the year ending March for preparations toward land reclamation. It has said that some berths at the unified and expanded container terminal at Tuas may be ready as soon as 2022.
The deepwater port will eventually have capacity for 65 million standard 20-foot containers a year, according to Transport Minister Lui Tuck Yew. Bloomberg