Container Port Selection in the ASEAN Region: Korean Shipping Companies’ Perspective

Abstract

Ports are crucial platforms that connect the sea and inland transportation to foster logistics and transfer of goods and information. Thus, selection of the most optimal ports is ever crucial for decision makers. However, the increasing globalisation and international trade add to the already competitive and saturated market for marine container cargo shipping. Consequently, it may be of best interest to shift focus and find niche market, such as trading to the Southeast Asia, to increase profitability. In near proximity to Southeast Asia, South Korean multinational corporations’ investment and interest in the Southeast Asian countries are significant. South Korea maintains a high position in the maritime transport business in the world and is one of the largest economies as well. Additionally, the topic of container port selection from South Korean shipping companies in the Southeast Asian region is under-researched. Therefore, this calls for an investigation into finding the most important port selection factors for Korean shipping companies that provide services to Southeast Asian countries and determining which ports are most optimal. This study focuses on container cargo shipping specifically and aims to enhance the understanding of port selection and port attractiveness. In order to identify the driving port selection factors, port selection studies published between 1985 and 2022 were obtained from Systematic Literature Review (SLR) and analysed. Next, the identified factors have been verified and refined after pilot test and interviews with academic scholars and industrial experts of container port selection. Then, to determine the weight of importance of these factors as well as to choose the optimal ports of targeted alternatives, two-step Analytic Hierarchy Process - Technique for Order of Preference by Similarity to Ideal Solution (AHP-TOPSIS) is used. Following such process, this study has identified 4 main factors encompassing 14 sub-factors on container port selection through SLR. After series of revisions on these factors through pilot test and interviews, the study was able to refine the container port selection factors to 4 main factors encompassing 12 sub-factors. Then, using the two step AHP-TOPSIS, weights of the aforementioned factors have been determined, and the rankings of optimal ports, based on the initially chosen 6 Southeast Asian ports, have been calculated. The last portion of this study performed sensitivity analysis to test the robustness of the AHP-TOPSIS model and produced multiple hypothetical scenarios to instigate changes in the obtained rankings of ports. Theoretical and practical contributions arising from this study include enhancing the understanding of container port selection and port attractiveness especially in the Southeast Asian region from Korean shipping companies’ perspectives. This particular topic is under-researched; therefore, this study’s investigation will contribute by filling in the gap in port selection literature. Additionally, weights of factors as well as rankings of targeted ports can provide crucial pieces of information for decision makers of port-related stakeholders since these results specify the degree of importance of such factors and the optimal order of ranking of ports. Furthermore, the multiple constructed scenarios provide various reference points to which port-related stakeholders can use when devising plans to improve port attractiveness.