1.Integration of City and Port is an innovative concept: President Chen

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1 1.Integration of City and Port is an innovative concept: President Chen President Chen arrived at Kaohsiung While inspecting the business operations of the Port of Kaohsiung, President Chen Sui-bian told the media managerial staff that the integration of Kaohsiung City and Kaohsiung Port is an innovative concept". He mentioned that the relationship between central government and local government should be partnership rather than competition. President Chen said the development potential for Kaohsiung city would be very bright following the integration of the city and the Port. President Chen also said that the local government has long requested the central government allow the integration of the city and port. However, the former ruling party refused to do so and that to some extent limited the Kaohsiung city's development. After entering the presidential office, President Chen has been making efforts to balance the development of the North and the South. His decision to relocate this year's Lantern Festival from Taipei to Kaohsiung is just one example of his determination to allocate resources more evenly throughout Taiwan. 2.Kaohsiung Port 2020 Plan Approved The Executive Yuan has passed the Kaohsiung Port 2020 plan as formulated by the Kaohsiung Harbor Bureau. The plan will entail an estimated investment of NT$207.5 billion (about US$6.5 billion on US$1:NT$32 basis) in four five-year sub-plans by 2020 and bring about an overall enhancement of the harbor's international competitiveness. The plan calls for harbor utilization to be re-zoned into separate harbor operation, harbor administration, national defense, industry, and fishery districts. Accompanying construction measures include the improvement of navigation systems,information systems, and operational systems; the redevelopment of the old harbor area into a waterfront recreation and commercial district; a ship waste treatment system; a water-quality monitoring system; and harbor access road. The goal is to make Kaohsiung harbor the most efficient and cleanest harbor in Asia.

2 3.Comprehensive development plan for Kaohsiung Port President Chen Shui-bian and high ranking officials, as well as invited guests - a group of sixty or so people - arrived at Kaohsiung Port on May 11, They took an inspection tour on board a KHB boat along the port channel. During the trip, they observed the ongoing construction of the port, and loading and unloading of cargo ships, and the operation of container terminals. Meanwhile, the Director of KHB briefed the President on Kaohsiung Port's blueprint for the future"--- Kaohsiung Port 2020 plan". Director Oliver Yu pointed out that 80% of world trade relied on maritime transportation; in Taiwan's case, more than 95%. This demonstrates the fact that the Port has been playing a significant role in the economy, and particularly in import-export trade. Asia is the emerging economic center of the world; MOTC Minister Yeh, speaking at an inspection tour on board a KHB boat Director Oliver Yu brieged The President chen on Kaohsiung Port 2020 plan Kaohsiung Port is strategically located in East Asia. Owing to excellent natural conditions and links to an extensive global transport network as well as efficient operations and advanced facilities, Kaohsiung Port serves as an industry leader. Thanks to the great efforts made by KHB, last year container handling reached 7,420,000 TEU at Kaohsiung Port, accounting for 75% of container operations in Taiwan. Furthermore, positioning Kaohsiung Port as an operational hub or feeder port will have a great impact on employment and the economy and - more importantly - on tax revenue. In order to lower operational costs there is a trend in the shipping industry to enlarge ships and centralize shipping routes. In addition, growing demands are being made on the conditions of ports: deeper depths, broader operational areas, heavier loads, and higher working efficiency. To shipping companies at home and abroad, Kaoshiung Port is regarded as an operational center, and upgrading the competitiveness of Kaohsiung Port the most pressing issue. Kaohsiung Port's blueprint for the future is based on effective utilization of Port resources, mutual development of city and port, an increase in operational capacity, and centralized management of diverse areas. In addition, in order to accommodate the government's policy of promoting Kaohsiung as a Multi-functional Commerce and Trade Park, construction of waterfront recreation, and integration of city and port, KHB is scheduled to redevelop old Harbor areas into commercial waterfront recreation, and improve external road links and the disposal system for discarded goods from ships.

3 4.Taiwan Cabinet Approves International Commercial Port Management Committee On May 9, 2001, the Taiwan government made a very important decision regarding the country's port management and operations system. The decision was to approve the so-called "interim measures" aimed at giving local cities or counties power to control their nearby harbors. The new measures have been designed as a stopgap to allow Kaohsiung city to manage its harbor until a bill for the same purpose has passed through the Legislative Yuan. The bill, titled the "Port Authority Establishment and Monitor Act", will transfer the central government of control over the four international commercial harbors in Taiwan to local governments. Under the new bill, harbors will be managed by an independent commission headed by the mayor of the port city to boost the efficiency of its management. Director Oliver Yu invited Mayer Frank Hsieh to visit on going construction of the port The so-called "International Commercial Port Management Committee" proposed by the Ministry of Transportation and Communications (MOTC) basically contains ten points. The major points are briefly as follows: First, the Committee is organized in accordance with Article 26 of the MOTC Organizational Act, which gives authority to the MOTC to organize committees to conduct specific tasks. Secondly, the chief commissioner will be the local city mayor or the county magistrate, in accordance with the ruling party's campaign to allow local government control over commercial harbors. In addition, the Committee will include other members: (1) two from the central government appointed by the MOTC, (2) two from the local government (3) one to three experts suggested by the local government and approved by the MOTC, (4) Director of the Harbor Bureau and a representative appointed by the port labor union, (5) a representative appointed by the auxiliary port county magistrate. Frank Hsieh, The current mayer of Kaohsiung holds the establishing ceremony of Kaoport Management Comminttee on June 15 and assured that the harbor would be run more efficiently

4 Frank Hsieh, the Chief Commissioner of Commercial Port Management Committee with other members attend the first meeting of CPMC Thirdly, the authority of the Committee includes: (1) the port area land planning, use, construction, operation and management as well as review and consultation on major safety issues; (2) the coordination and integration on interaction issues between port and city or county, such as city planning, transport construction, environmental protection, pollution control, safety management, civil defense, law enforcement and fire fighting matters, etc; (3) review and decisions on the harbor bureau's budget and expenditure; (4) other matters commissioned by the MOTC. Fourthly, the measures disqualify certain people from becoming Committee members, such as (1) the owner or manager of shipping or related businesses; (2) councilors or parliamentary representatives; (3) Non-ROC citizens; (4) employees of the harbor bureau; (5) people with a criminal record; (6) Committee members who do not attend meetings on four consecutive occasions; and (7) Committee members who have changed their position. Other notable points include: (1) Generally, the Committee should convene a meeting every two months; (2) the executive secretary of the Committee is the Director of the Harbor Bureau; (3) the decisions of the Committee meeting should be reported to the MOTC and/or Executive Yuan in accordance with Commercial Port Law or related regulations for approval and taking action. However, the committee will not have full authority to allocate the port's revenue or control the port authorities' personnel under the temporary measures.

5 5.Stage One of Taisugar Kaohsiung Logistics Park Completed The completion of the first stage of construction on the Taisugar Kaohsiung Logistics Park, Taiwan's first such facility planned for international logistics, was marked by a formal ceremony on Mar.31. This event symbolized the launch of Kaohsiung's multifunctional economic and trade zone, and moved Taiwan giant step forward on its road to becoming a global logistics hub. President Chen, speaking at an Inauguration ceremony of T..L.P The new park is being developed by the Taiwan Sugar Corp. and china President Logistics Inc. with a total investment projected at NT$2.8 billion. It combines the functions of logistics, warehousing, processing, transshipping, international conferences, exhibitions, and commercial information technology (IT) operations, and is projected for completion in four stages within five years. President Chen, Minister Tsai, Premier Chang Mayer Frank Hsieh Attend the Inauguration ceremony of T..L.P Taiwan Sugar Logistic Park (TSLP) is located in the Chen Kon District of Kaohsiung not far from Kaohsiung international Airport and the Port of Kaohsiung, and is also close to the national freeway. Building a logistics center in the area is a natural outcome of all these transportation advantages.

6 6.The Port of Kaohsiung is transforming itself into a logistics port Kaohsiung Port, one of the largest container port in the world, is actively promoting the development of its warehouse and logistic facilities. The top priority for KHB this year is to further transform itself from a transshipment port into an advanced logistic port. A Warehouse and Transshipment Development Project has been launched by Kaohsiung Export Processing Zone in the neighboring area and another two shipping companies are developing their logistics businesses. Furthermore, the construction of the estimated US$ 300 million Yang Ming Global Logistics Center has commenced at Yang Ming container terminal in Kaohsiung Port. Mr. Oliver, Director of KHB, has noted that warehouse and logistic development is an international management trend; by using advanced computerized facilities to handle orders, warehouse inventory, etc, we can nhance our international competitiveness and substantially increase our transportation efficiency. He added that the Government has adopted the policy of upgrading Taiwan to the status of a global transshipment center. KHB has completed its plan for the old harbor renovation and function readjustment for each berth, to enable shipping companies to broaden their warehouse and logistic business. In addition, the berths for storing hazardous petrochemicals will be moved offshore.

7 7.KHB cooperates with National First University of Science & Technology to face the challenge of being an international port In order to meet the demands of city port integration, KHB and National Kaohsiung First University of Science & Technology (NKFU), National Sun Yat-sen university (NSYSU), National Cheng Kung University (NCKU) have reached a cooperative agreement. They are expected to make good use of mutual resources and establish a cooperative mechanism between government and academic circles. Kaohsiung Port should benefit from this exchange of practical experience following the city-port merger. In response to Taiwan's future accession to WTO, Kaohsiung Port - currently a transshipment center - needs to enhance its competitiveness by transforming itself into a multi-functional Port. At present, upgrading of hardware and software and strengthening of its international marketing strategy is KHB's top priority. One university spokesperson, noted that NKFU with its fully-qualified departments of Transshipment & Warehousing, Marketing, Information, Risk Management, etc. are able to provide KHB with consultation on warehousing, marketing, financial management, and its Vessel Traffic Management System. KHB Director Oliver Yu and Dr. Chia-Hung Ku, President of NKFU, Dr. Victor W. Liu, President of NSYSU, Dr. Chiang Kao, President of NCKU, signed an agreement on June 5,6,7 (from above to below) for future cooperation in establishing a cooperative mechanism between government and academic circles. The two-year agreement would commence on June, 2001, and encompass training, mutual research plans, academic conferences, exchange of information on ports, the environment, engineering, and establishment of a `think tank'. Furthermore, KHB emphasized that it will provide students with practical training opportunities; similarly, NKFU will assist employees of KHB within their specialized fields. KHB Director Oliver Yu and Dr. Chia-Hung Ku, President of NKFU, Dr. Victor W. Liu, President of NSYSU, Dr. Chiang Kao, President of NCKU, signed an agreement on June 5, 6, 7 for future cooperation in establishing a cooperative mechanism between government and academic circles.

8 8.New facilities constructed in the Port of Kaohsiung To provide shipping companies with better facilities and an improved operational environment, KHB has completed several construction such as bellow: Renovation of Berths No.17 to No. 21 These Berths have been checked and accepted which are expected to increase by 1,500,000 tons the amount of cargo handled yearly. The renovated berths are to be utilized by general cargo ships, fishing boats, and other suitable vessels commencing on May 25, In addition, the construction of a car-control station was completed on June 1, Harbor Craft Basin The water coverage of the harbor craft basin is 60,300 square meters, and the length of the berth totals 1,245 meters. The basin can accommodate twenty 500-ton working boats. Boats docking at this basin will be charged. Coast Guard Basin The water coverage of the shoal berth is 17,160 square meters, while the length of the berth totals 460 meters. The berth will later be leased to the Coast Guard Administration, after which new office buildings in the base will be constructed by the Coast Guard Administration. Before the lease is signed, the Kaohsiung Harbor Bureau has decided to open the berth temporarily as a pay berth for maritime working boats to dock. Maritime Working Boat Basin The Bureau's 43 working boats can all berth in this base. The base is equipped with water storage, a gas station, work station, and rest area. These three facilities mentioned above were constructed immediately beside each other in Chichin waters. Since completion of the construction, these new facilities can now be utilized for the berthing of maritime working boats, coast guard boats, and the Port's own working boats. As a result, the safety and order of harbor waters have been further improved, while the utilization of the berths and the income arising from them will increase as will.

9 9.Cabinet Approves Establishment of Quasi-governmental Port Authority In a move designed to boost the competitiveness of Taiwan's commercial harbors, the executive Yuan (Cabinet) approved a draft Statute for Harbor Bureau Establishment and Supervision, as formulated by the Ministry of Transportation and Communications, on Mar.21. At the same time, the Cabinet approved revisions of Article 4 and 7 of the Organizational Law of the Ministry of Transportation and Communications and the draft of the Organizational Law of the Maritime Administration Bureau, MOTC, along with the draft of a new Organizational Regulations for Branches of the Maritime Administration Bureau, MOTC. These bills will be submitted to the Legislative Yuan for deliberation. The Ministry of Transportation and Communications (MOTC) points out that harbor operations that involve governmental authority will, in the future, be under the control of the central government, while operations that involve service will be the responsibility of a quasi-governmental port authority. The revised Organization Law of the Maritime Administration Bureau, MOTC readjusts the responsibilities, organizational structure, and personnel management of the bureau, and after it is established the MOTC will set up branch bureaus at the different commercial harbors to handle supervisory work.

10 10.The container ship, M/V Ming Pine, makes its maiden voyage China Shipbuilding Company was contracted by Yang Ming Marine Transport Corp. to build a new 5,551 TEU ship--- M/V Ming Pine, which was delivered on April 7 and made its maiden voyage to Kaohsiung Port on April 9, 2001, docking at Berth No. 70. The chief of the Harbor Management Department, Mr. Tsai, presented a Kaohsiung Port plaque and souvenirs to the ship's captain as a warm welcome. M/V Ming Pine left Kaohsiung Port and headed for the US West Coast on April 10. M/V Ming Pine is the fifth of seven newly built 5,500 TUE ships for Yang Ming. The third and the fourth ade their maiden voyages to Kaohsiung Port on March 20, The M/V Ming Pine is capable of carrying 5,551 TEU and is 275 meters in overall length, 40 meters in width, 24.2 meters in depth, and can reach a speed of 26.5 knots. In the future it is expected to join the U.S West Coast trade route. 11.Offshore transshipment center expected to exceed 500,000 TEU According to statistics by the MOTC, last year offshore transshipment container traffic in Kaohsiung Port amounted to more than 430,000 TEU, increasing by 8.25% over Compared to containers operated by Mainland Chinese Shipping companies, last year Taiwan accounted for only 128,700 TEU, falling slightly year-on-year. In contrast, Mainland Chinese shipping companies created more than 70% of the annual container volume of Kaohsiung offshore transshipment traffic and has been growing rapidly for the past three years. At present, there are 12 shipping companies operating offshore transshipment at Kaohsiung port : five Taiwanese shipping companies and seven Chinese ones. Unit:TEU year Taiwanese shipping Mainland Chinese % operated by Companies shipping Companies Mainland Chinese Total , , % 127, , , % 272, , , % 365,869.00

11 , , % 432, , , % 1,198, Jackao International Co., Ltd celebrated both its acquirement of International ISO-9002 certification and the business anniversary of Warehouse No.37 Jackao International Co., Ltd and its Cargo Handling Company recently celebrated their ISO-9002 certification and the operational anniversary of Warehouse No.37. In addition, they officially opened storage yard No.36 and a new shipping route - Taiwan to Europe - by German Rickmers-Line, whose shipping agent is Jackao Company. Moreover, a Bahaman-registered ship, Rickmers Tianjin", made its maiden voyage to Kaohsiung Port. Jackao Co. Ltd invited guests from the shipping industry to participate in a party held on March 27, 2001 at Warehouse No.37. Thirty years ago, President J.C. Kao established Jackao International Co., Ltd; primarily as a shipping agency. Over time, due in large measure to Mr. Kao's astute business sense and financial responsibility, the business has become more and more prosperous. The Rickmers Tianjin" itself is 23,239 GWT, 182 meters in length, 27 meters in width, and with a draft of 12 meters in depth. In the future it will navigate the western American route and, as a result, add to the cargo business at Kaohsiung Port.

12 13.Kaohsiung Port Area becomes an ecological classroom Is that a black-tail gull?" During Chinese New Year, an auspicious miracle" occurred: flocks of migratory birds ( black-tail gulls) appeared in the area of Kaohsiung Port. The number of birds was estimated to be around two hundred. In fact, hundreds of egrets have also perched in this area for a long time. It is further proof that KHB is enjoying some success in its attempts to improve the environment of Kaohsiung Port. Flocks of migratory birds from the north usually perch in the following areas: the breakwater of Port Entrance No. 1(nearby Sun Yat-sen University), the end of Ku-Shan market, and Chi-Chin Ferry station. As ships or boats pass, the black-tail gulls will fly behind the ships and eat the fish jumping out of the water. The gulls stayed for two weeks or so and then departed. It is to be hoped they return next year. Migratory birds have become something of a `natural' litmus test for the health of the environment around Kaohsiung Port. Lin Kun-han, Secretary of the Kaohsiung Wild Bird Association, has stated that every year there are flocks of migratory birds flying toward the south. In the past, there have also been black-tail gulls", but a much smaller number. This year, with the changes to the environment, in particular the improvement in water quality of Kaohsiung Port, there are many more migratory birds flying here. In addition to the migratory birds, egrets that in the past could only be seen in the countryside or around fish farms have lately begun migrating to the city in large numbers. Two years ago, the egrets that first emerged at Kaohsiung Port liked to gather at Chi-Chin fishing port; recently they have moved to areas closer to Love River. KHB has been striving hard to improve the environment of Kaohsiung Port: both land and water regions. In particular, the quality of the water has improved greatly. No longer do oil slicks, garbage and flotsam stain the surface of the sea. Indeed, it's very likely Kaohsiung Port will be the cleanest commercial port in Asia in the near future.