Direct sailing across the strait of Taiwan

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Direct sailing across the strait of Taiwan

• Opportunities for ship-owners and other players
• April 28, 2009 Shanghai

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Taiwan and the Strait
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Latest development on the ties across the Straits
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• On Sunday (April 26) China and Taiwan agreed to
• 1.expand air links (charter flights to
  scheduled flights)
• 2.promote mainland Chinese investment on the
  island
• 3.take a big step towards opening up their
  financial services industries to each other

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Latest development on the ties across the Straits
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• "The mainland will buy more products from Taiwan
  and send more tourists to the island, while
  encouraging more Taiwan enterprises to set up on
  the mainland to maintain stable development."
  Chen Yunlin,president of China's Association for
  Relations Across the Taiwan Straits (ARATS).

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Historic Day

• On November 4 2008, the Cross-Strait Sea
  Transport Agreement was executed, implementing
  for the first time direct transportation of cargo
  and passengers across the Taiwan Straits over the
  past 60 years
• ?2008?12?15????? Officially implemented on Dec
  15, 2008

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The main points to note in relation to the
Agreement

• Cross-Strait transportation will mainly be
  carried out by vessels owned by companies based
  on either side of the Straits.
• PRC and Taiwanese owners flying PRC, Taiwanese
  and Hong Kong flags may engage in direct
  Cross-Strait carriage of passengers and cargo. 
• PRC and Taiwanese owners flying FOC flags, and
  having obtained special permits, may engage in
  direct Cross-Strait carriage.

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The main points to note in relation to the
Agreement

• Taiwan will open 11 ports and the PRC will open
  up a total of 63 ports (48 seaports and 15 river
  ports).
• The basis of the Agreement is equal participation
  and orderly competition, with the arrangement of
  transport capacity to be based on market demand.

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The main points to note in relation to the
Agreement

• Mutually exempt each others shipping companies
  from the payment of business and income tax on
  revenue derived from participation in
  cross-Strait shipping.
• Shipping companies involved will be permitted to
  establish offices or business entities on the
  opposite side of the Strait.

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The main points to note in relation to the
Agreement

• Parties to the Agreement have agreed to cooperate
  fully in
• disaster rescue operations
• jointly safeguard navigation and the safety of
  life, property and the environment at sea
• the handling of matters concerning communication,
  navigation, license inspection, vessel
  inspection, crew services, navigation safeguards,
  pollution prevention remediation and maritime
  dispute arbitration.

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Benefits

• Direct linking shortens the ocean transit time
  thus operation cost reduced.
• Shipping related business such as pilotage,
  stevedore, warehousing, finance, insurance etc
  will benefit from the direct sailings as well.
•  

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Opportunities

• Invest and operate in Taiwan ports on
  terminal and transshipment facilities
• Roro, Ropax, Cruise

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Investment in Taipei Port
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Investment in Taichung Port
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Establish CBFs in Taiwan

• In Free Trade Zones in Taipei or Taichung port,
  Taiwan to establish Coal Blending facilities to
• BLEND Australian Coal, Indonesian Coal with Coal
  from Northern China and then
• DISTRIBUTE the processed coal to the Pearl River
  Delta and the Yangtze River Delta area, in the
  Mainland.

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North Sea Services Map
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ECFARoro

• The combination of ECFA and Roro can bring about
• JIT (Just in Time) concept
• Bonded Zone products processing in the mainland
  and re-export to Taiwan

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Advantages of RoRo for Short Sea Freight Movement

• Cargo handling reduced / Port time minimised
• Roll-on / Roll-off is a very fast system for
  loading/unloading in comparison to other ways of
  transporting similar freight.
• Motorways of the Sea
• European concept of continuity between road
  transport and shipping.
• Road traffic and driver restrictions eliminated.

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Advantages of RoRo for Short Sea Freight Movement

• Ability to transport a wide variety of cargoes
• Accompanied / Unaccompanied Trailer Units
• Refrigerated Units
• Loaded Mafi Trailers
• Project Cargo (not necessary for cargo to conform
  in size and shape)

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Advantages of RoRo for Short Sea Freight Movement

• Benefits for Truck Operator
• Increased security/safety for high value goods
• Reduced driver costs and maximised trailer
  productivity

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RoRo Seamless Freight Transport
RoRo Terminal, trailers arrive and are left for
loading
Road Freight from warehouse/factory to port
Tractor units load trailers onto vessel (trailers
can be loaded accompanied by their own tractor
unit and driver)
Vessel sails, open/closed decks increase cargo
allowances, electric power available for
refrigerated units
Vessel Docks, ramps allow for fast efficient
unloading
Trailers are unloaded and back on the road to
destination
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RORO-Driver Accompanied 1
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RORO-Driver Accompanied 2
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RORO-Driver unaccompanied
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Variety of Cargoes
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PBs Roro Business

• 4 newbuildings and 2 purchase option vessels
  (3,600-3,800 lane metres) set to deliver between
  2009 and 2011
• Proven design, environmental friendly, and
  suitable for the common short sea trades

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Cruise
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High-Speed Catamaran for Passenger and Cargo
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Recent Development

• Fujian Province has planned to develop Roro and
  Ropax services by copying the Mainland-Hongkong/
  Macau model, i.e. allowing cars and trucks to run
  on each other sides roads. The province is also
  trying to open Passenger Routes between Taiwan
  Island(????) and Fuzhou, Xiamen
• The first Ropax licence has been issued to a
  Taiwanese company for Taichung to Xiamen service

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Hurdles

• Legal issues/Regulations (car licence plates)
• Bureaucracy
• Political Uncertainties
• Difficult Market Research