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KAOHSIUNG: Three major mainland shipping companies plan to invest in the biggest Taiwanese port in Kaohsiung, a top port official said yesterday, as cross-Straits trade ties grow.

China COSCO, China Shipping Container Lines Co Ltd and China Merchants Group plan to invest in Kaohsiung port, the world's eighth largest in 2008.

"Cosco's plans are on the drawing board right now. They will have a more specific investment plan by the end of next year," Shieh Ming-hui, director-general of the Kaohsiung Harbour Bureau, told Reuters in an interview.

Cosco is the world's largest dry bulk shipper.

None of the three have said how much money it would invest or how big a project it sees in Kaohsiung, which is Taiwan's biggest port with annual capacity of up to 10 million 20-foot equivalent units (TEU).

The mainland firms are expected to use areas of the port where they invest, and all three have visited Kaohsiung to explore their options, usually keeping a low profile, he said.

"After so many years of severed relations, they don't know much about Taiwan," Shieh said.

Kaohsiung port, once the world's third busiest port in the late 1990s, saw its ranking slip away while the mainland's economy rose, as a lack of direct transportation links with the mainland undermined its position.

However, a deal signed between the two sides last year has renewed mainland shipping companies' interest in the port, driving potential investment plans, Shieh said.

Shipping lines previously made costly detours through third countries or regions to get cargo from one side to the other, he said, so mainland firms had little interest in Kaohsiung's port, which is otherwise attractive because of its relatively short distance from the mainland.

Shipping links are crucial as thousands of Taiwan investors have poured about $100 billion into the mainland, where they are lured by a common language and culture as well as relatively low labor costs.

Reuters

(HK Edition 05/13/2009 page15)