China - Shanghai Port Restructuring and Development Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 20030 IMPLEMENTATION COMPLETION REPORT CHINA SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT (LOAN 3552-CHA) January 18,2000 Transport Sector Unit East Asia and Pacific Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Name = Renminbi Currency Unit = Yuan (Y) Yuan rate per $1.00 1993 5.762 1997 8.290 1994 8.619 1998 8.279 1995 8.351 1999 8.278 1996 8.314 FISCAL YEAR January 1 - December 31 MEASUREMENT EQUIVALENTS Metric System British/US system 1 meter (m) = 3.281 feet 1 square meter (m2) 10.764 square feet 1 cubic meter (m3) = 35.315 cubic feet 1 kilometer (km) 0.621 mile 1 ton-km = 0.621 ton-mile 1 ton = 2,208 pounds PRINCIPAL ABBREVIATIONS AND ACRONYMS USED ANFA Average Net Fixed Asset DC ratio - Debt and Capital ratio D/S - Debt Service dwt - deadweight ton (for vessel) EASTR - Transport Sector Unit, East Asia and Pacific Region EIRR - Economic Internal Rate of Return GOC - Government of China ICB - International Competitive Bidding ICR - Implementation Completion Report MOC - Ministry of Communications MOF - Ministry of Finance NCB - National Competitive Bidding NPV - Net Present Value OC - Operating Cycle PCMIS - Port Costing and Management Information System REIRR - Reevaluated Economic Internal Rate of Return RFA - Reevaluation on Average Net Fixed Assets RRFA - Rate of Return on Average Net Fixed Assets RVP - Office of Regional Vice President SAR - Staff Appraisal Report SCT - Shanghai Container Terminal Ltd. SOE - State-Owned Enterprise SPA - Shanghai Port Authority TA - Technical Assistance teu - twenty-foot equivalent unit (for container) WSC - Shanghai Waigaoqiao Free Trade Zone Stevedoring Co. Vice President Jean-Michel Severino, EAP Country Director Yukon Huang, EACCF Sector Director Jitendra N. Bajpai, EASTR Task Team Leader Toshiro Tsutsumi, Sr. Port Engineer, EASTR  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT FOR OFFICIAL USE ONLY CONTENTS Preface .......................................................... i Evaluation Summary .........................................................v Part I. Implementation Assessment .........................................................1 A. Project Objectives ........................................................ I B. Achievement of Objectives .........................................................1 C. Major Factors Affecting the Project .........................................................9 D. Project Sustainability .........................................................9 E. Bank Performance ........................................................9 F. Borrower Performance ........................................................ 10 G. Assessment of Outcome ........................................................ 10 H. Future Operation ........................................................ 10 I. Key Lessons Learned ........................................................ 10 Part II. Statistical Tables ........................................................ 13 Table 1: Summary Of Assessments ........................................................ 13 Table 2: Related Bank Loans/Credits ........................................................ 14 Table 3: Project Timetable ........................................................ 14 Table 4: Loan Disbursement ........................................................ 15 Table 5a: Key Indicators for Project Implementation ........................................................ 16 Table 5b: Training (Overseas Training) ........................................................ 17 Table Sc: Procurement Schedule ........................................................ 17 Table 6: Key Indicators For Project Operations .................................. ...................... 18 Table 7: Studies Included In Project ........................................................ 19 Table 8a: Project Cost ........................................................ 21 Table 8b: Project Financing ........................................................ 21 Table 8c: Allocation of Proceeds ........................................................ 21 Table 9: Economic Costs, Benefits and Major Financial Indicators ...................................... 22 Table 10: Status of Legal Covenants ........................................................ 23 Table 11: Compliance with Operational Manual Statements ................................................ 23 Table 12: Bank Resources: Staff Input ........................................................ 24 Table 13: Bank Resources: Missions ........................................................ 24 Appendix A: ICR Preparation Mission Aide-Memoire ........................................................ 25 Appendix B: Borrower's Contribution to the ICR ........................................................ 29 Annex 1: Financial Analysis ........................................................ 33 Table I.1: Shanghai Port Authority Income Statement ........................................................ 33 Table 1.2: Shanghai Port Authority Balance Sheet ........................................................ 34 Table 1.3: Shanghai Port Authority Sources and Applications of Funds ............... ............... 35 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPoRT Annex 2: Economic Analysis ......................................................... 36 A. Traffic ......................................................... 36 B. Ship Time Analysis ......................................................... 37 C. Berth Operations ......................................................... 37 D. Economic Costs and Benefits .......................................................... 38 E. Overall Economic Reevaluation And Sensitivity Analysis ............................................... 40 Table 2.1: Port Traffic ......................................................... 42 Table 2.2: Ship Time Analysis ......................................................... 43 Table 2.3: Operational Parameters Assumed for Economic Evaluation ................................ 44 Table 2.4a: Economic Cost Summary ......................................................... 45 Table 2.4b: Price Index for Calculation of Economic Cost ................................................... 45 Table 2.5: Shadow Price Calculation ......................................................... 46 Table 2.6: Sample of Cargo Handling Without And With Proposed Berths ......................... 47 Table 2.7: Loading/unloading Cost Savings Summary ......................................................... 48 Table 2.8: Economic Benefits Summary ......................................................... 49 Table 2.9: Economic Rate of Return (ERR) and Sensitivity Analysis .................................. 50 Map ......................................................... 53  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT iii IMPLEMENTATION COMPLETION REPORT IMPLEMENTATION COMPLETION REPORT CHINA SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT (LOAN 3552-CHA) PREFACE This is the Implementation Completion Report (ICR) for the Shanghai Port Restructuring and Development Project in China for which Loan 3552-CHA for US$150.0 million was approved on December 22, 1992 and made effective on May 13, 1993. The loan amount was revised US$124.26 million on November 30, 1997, to take account the cost savings of US$25.74 million. The loan was closed on June 30, 1999, as originally planned without any extension. Final disbursements were made on January 19, 1999. The total amount of the loan disbursed was US$120.07 million. The remaining balance of US$4.19 million was canceled. The ICR was prepared by Messrs. Toshiro Tsutsumi (Task Manager) and Han-Kang Yen (Economic and Financial Analyst) of the Transport Sector Unit, East Asia and Pacific Region; reviewed by Messrs. Jitendra N. Bajpai (Sector Director, EASTR), Robin Carruthers (Principal Transport Economist, EASTR), Marc Juhel (Senior Port Operations Specialist, TWUTD), Ismail Mobarek (Principle Maritime Transport Specialist, SASIN), and Kek Clhoo Chung (former Bank Staff). Preparation of this ICR started before the project closing date and was based on material in the project file. The Borrower contributed to the ICR by evaluating the project's execution and initial preparation.  iv SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT v IMPLEMENTATION COMPLETION REPORT EVALUATION SUMMARY SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT (LOAN 3552-CHA) CHINA Objectives 1. Shanghai Port is the largest port in China and gateway to eastern and central China. This project was the third Bank-financed project for Shanghai port. The first and second projects focused on containerization and alleviating congestion, providing additional modern terminal facilities and improving institutional management capacity. The third project focused on restructuring the port, i.e., providing facilities along the Yangtze River and shifting port operations from the congested city center and further commercializing the port authority's activities. When the project was identified, Chiina's economy was growing very rapidly and Shanghai Port traffic was expected to increase rapidly as well. 2. The project's main objectives were to help the port of Shanghai in: (a) the long-term development of the port and the use of its facilities by gradually slhifting port operations away from the congested city center and by promoting terminal specialization; (b) providing needed additional capacity in a rational, optimal, and environmentally sound way; and (c) increasing efficiency by introducing modem methods of operational and financial management. 3. Project components included: (a) provision of new and replacement cargo handling equipment (for existing terminals) to improve cargo handling efficiency and promote terminal specialization; (b) measures to improve Shanghai Port Autlhority's (SPA) financial condition through tariff restructuring, computerization of accounting, auditing and budgetary control; (c) the construction of new terminals (first stage) at Waigaoqiao (for containers) and Luojing (for coal) with procurement and installation of the necessary cargo hanidling equipment; and (d) techi ical assistance and training. 4. A joint venture between a Hong Kong operator and SPA, Shanghai Container Terminal Ltd. (SCT), was established to run container operations at Jungonlu, Zhanghuaban and Baoshan terminals. The Waigaiqiao terminal developed under the project was operated by SPA in competition with SCT at the other terminals, which created intra-port competition. Implementation Experience and Results 5. The project was completed satisfactorily by June 30, 1999, as originally planned. Major components were completed before the closing date. Bank procedures were followed and project objectives were achieved. Physical components-Waigaoqiao and Luojing terminals-were constructed, implementation of corporate planning and several studies for specialization of terminal operations were carried out, and replacement equipment for existing terminals was procured. Both managers and workers of SPA received extensive training, and operational and  vi SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT maintenance capacity improved. In addition to the Port Cost Managemenit Information System (PCMIS) established and implemented under the second Bank-finaniced project, thle Port Tariff System was established to increase SPA's financial management capacity. Waigaoqiao terminal's productivity equals that of the SCT and intemational standards. In addition, SPA is seriously implementing organizational reforn to improve institutional efficiency. 6. These satisfactory achievements were due to the increase in SPA's capacity in the face of competition and its experience with previous Bank projects, as well as good coordination between SPA and the Ministry of Communications (MOC), in particular for the implementation of the Port Tariff Study. 7. Cost estimates at appraisal were very reasonable. The final cost is estimated at about Y2,253.3 million, compared to an SAR estimate of Y2,439.4 million. Actual US$ project costs amounted to US$314.7 million, about 25 percent lower thani the US$424.3 million estimated at appraisal. The lower US$ amount is due to the devaluation of the Yuan and savings achieved from competitive bidding (paragraph 23, main text). 8. The project's benefits were also achieved, including savings in cargo-handlinig costs, ship waiting and berthing time and cargo time. The economic internal rate of return (EIRR) was estimated at 29.2 percent against 36.7 percent in the SAR, wlich is still consider-ed satisfactory (paragraph 22, main text, and Annex 2). 9. SPA's financial performance is sound. The operational ratio (operating costs/operating revenues) was close to the SAR estimate (69 percent compared to 68 percent for 1997). In addition, as container traffic is likely to continue to increase, SPA's financial conditioni should remain sound. 10. No environmental or resettlement problems arose during preparation and implementation. A very small number of people were resettled. Sustainability 11. The project is considered sustainable. Because containier traffic will continue to grow along with economic development in the Shanghai area, the port's revenue will increase. SPA's productivity at Waigaoqiao Container Terminal has proven competitive to that of the SCT joint venture terminal (see Table 6). 12. Port facilities located in the downtown area should be restructured in the medium- to long- term. This process will require comprehensive coordination between SPA, municipality, terminal users, residents and private investors. SPA has already provided guidelines for investors to facilitate coordination. Findings, Future Operations and Key Lessons Learned Summary of Findings 13. Competition among ports in the Shanghai region increased significanitly in the past five years because of deregulation of grain cargo, private sector participation and cargo owners' having their own terminals. Shanghai Port does not have a monopoly on port facilities to serve the  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT vii IMPLEMENTATION COMPLETION REPORT Shanghai region. It has competition from neighboring ports (e.g.. Nantolng, Zhanjiagang, Nanjing) and terminals constructed by power plants thlat compete witlh coal unloading facilities. 14. Significant changes have been made since the Bank's first involvemenit in China's port sector in 1982. Major port authorities were decentralized from MOC to municipalities. Joint venture container terminal operations with foreign operators were started first in Shanghai and then in other ports (e.g., Dalian, Shenzheng, Tianjin, Xiamen, Fuzhou and the Guangdong area). While port authorities are now more aware of the role of the port as a vital transport link with other transport modes (rail and roads), policy coordination in the central government needs to be strengthened to improve the efficiency of multi-modal transport. Future Operations 15. SPA needs to continue its efforts to transfer terminal facilities out of the city, with the coal terminal receiving top priority. SPA has established guidelines for the land use plan for the city center terminals, and is encouraging investment by the private sector. 16. SPA needs to continue to restructure, right-sizing personnel, computerizing the financial accounting system, maximizing equipment use, and reducing operating costs. 17. To maximize use of bulk facilities, SPA must attract grain and coal traffic. To do so, it needs to monitor coal and grain traffic flows (in relation to the domestic harvest and national energy policies), transshipment patterns in the Shanghai region, and the supply-demand balance dictated by the world market economy (which in turn affects cargo owners' port and terminal choices). 18. The capacity of Waigaqiao terminal will need to expand further as demanld increases. Additional quayside container and rubber-tired gantry cranes will be required to meet future increases in container traffic. SPA also is constructing an additional 900-in-long container terminal with its own funds next to the Waigaoqiao terminal to meet expected future demand. Civil works are substantially complete, but capital investment for equipment has yet to be secured. To foster a higher degree of intra-port competition for future container terminal operations, SPA may wish to consider options, including concessioninig, beyond joint venture arrangements. 19. The Government of China (GOC) is deepening the approach channel to the mouth of the Yangtze River. When the project is complete, the port will benefit significantly from larger vessels and transport cost savings. While this is a long-term development, SPA should carefully monitor the progress and prepare appropriate scenarios and master plans. Key Lessons Learned 20. The public sector's performance at Waigaoqiao terminal is noteworthy because it was as strong as that of the joint venture terminals. While competition between SCT and Waigaoqiao terminals is limited, given that SPA holds 50 percent and 100 percent of shares, respectively, successful performance was possible only in an environment of competition. It would be worthwhile for the Bank to consider providing furtlher assistance to the port sub-sector if the introduction of more open competition is proposed.  viii SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT 21. SPA's past experience in completing two previous Bank-finainced projects satisfactorily was a factor for successful implementation. SPA has been familiarized with the Bank procedures and policy requirements; thus, no confusion in procurement procedures and compliance with legal covenants arose. 22. Continuity of staff played a factor for success. Both SPA and the Bank maintained the same multidisciplinary teams.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 1 IMPLEMENTATION COMPLETION REPORT PART I. IMPLEMENTATION ASSESSMENT A. PROJECT OBJECTIVES 1. Shanghai Port is the largest port in China and the gateway to eastern and central China. This was the third Bank-financed project for Shanghai port. The first and the second projects, the Three Ports Project and Ningbo and Shanghai Port Project, focused on containerization and alleviating congestion, providing modern terminal facilities and improving institutional management. The third project focused on restructuring the port. 2. The project's main objectives were to help the port of Shanghai in (a) the long-term development of the port and the use of its facilities by gradually shifting port operations away from the congested city center and by promoting terminal specialization; (b) providing needed additional capacity in a rational, optimal, and environmentally sound way; and (c) increasing efficiency by introducing modern methods of operational and financial management. 3. Project components included: (a) procurement of handlinig equipment to improve cargo handling efficiency and promote terminal specialization; (b) improvement of SPA's financial condition through tariff restructuring and computerization of accounting, auditing and budgetary control; (c) the construction of a container terminal at Waigaoqiao and a coal terminal at Luojing, including the procurement and installation of cargo hanidling equipment; and (d) technical assistance and training. 4. A joint venture between a Hong Kong operator and SPA, Shanghai Container Terminal Ltd. (SCT), was established to run container operations at Jungonlu, Zhanghuaban and Baoshan terminals. The Waigaiqiao terminal developed under the project was operated by SPA, in competition with SCT at the other terminals (see Table 6 for comparison of performance). B. ACHIEVEMENT OF OBJECTIVES Project Implementation CYvi Works 5. Construction of the Luojing coal terminal began in 1993. It was built under international competitive bidding (ICB) after prequalification procedures were followed. A domestic conractor won the contract and local consultants supervised it. The terminal was completed in December 1996, and after testing, adjusting equipment, and a trial period, was officially accepted in Docember 1997. The quality of construction improved compared to that under previous Bank- financed projects due to the improved capacity of domestic contractors. 6. Conshtion of Waigaoqiao terminal started on July 1, 1991, and was basically completed in October 1993. After testing, adjusting equipment and a trial period, the terminal was officially accepted in October 1994. The multi-purpose terminal was converted to a container terminal  2 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMP'LETION REPORT between July 1997 and June 1998, and is now fully operational. Waigaoqiao terminal was also satisfactorily constructed and financed locaily. 7. Construction of a bulk fertilizer berth (locally finaniced) was canceled because of low demand. Fertilizer handling will be transferred out of the city center in accordance with the port master plan. Equipment 8. Procurement was carried out through ICB, national competitive bidding (NCB) and shopping procedures. Major items of equipment were procured tlhroughl ICB (96 percelnt of the total allocated for Category 2-Goods). The largest procurement package was for equipment for Luojing coal terminal (two bucket unloaders, one grab unloader and a conveyer belt system). Documents were issued on June 17, 1994 and evaluation of bids was completed on January 5, 1995. No notable procurement probtems arose. 9. Procurement Procedures. Procurement of equipment required a lengthy evaluation period, while civil works procurement was carried out quickly. A two-level authorizationi procedure for equipment procurement-one at the regional level by SPA and anotlher at the central level by the State Evaluation Committee-slowed the process. Procuremelnt of a towing tractor took 217 days, the longest evaluation period of the project. SPA needed adequate time to compare the technical specifications tendered in the bids. In contrast, only 1 3 days were required to evaluate the civil works contract for Luojing Terminal, which did not require two-stage authorization (Table SC). Two-stage bidding procedures were followed to procure a computer system and bids were satisfactorily evaluated and implemented. Technical Assistance and Training 10. SPA successfully implemented extensive studies related to: (a) Corporate Planning, (b) Bulk Fertilizer Terminal Restructuring, (c) Dangerous Cargo Handling, (d) Cargo Unitization, and (e) Port Tariff Development. Details are provided in Table 7. 1 1. The Corporate Planning Study was intended to lhelp SPA build capacity for planning, monitoring budgets and preparing slhort- and long-term strategies tlhrough training and providing a corporate plan. The plan was satisfactory completed in June 1995 and included Comprehensive Development Strategy, Port Layout and Port Construction Investment Plans. 12. The objective of the Bulk Fertilizer Terminal Restructuring Study was to prepare a plan to remove the fertilizer terminal from the city center. The study began in May 1996 and was completed satisfactorily in May 1997. It recommended moving the fertilizer terminal to Wuhangou in Waigaoqiao according to the Municipal Master Plan. 13. The Dangerous Cargo Handling Study evaluated how to improve safety at Shaniglhai Port and prepared guidelines on dangerous cargo handling. The study began in May 1995 and was completed in 1997. It recommended that dangerous cargo be removed from the city center in the long term, but in the short term, concentrated in a few areas to facilitate safety supervision and control possible pollution. 14. The Port Tariff Development Study provided the port with a computerized cost-based tariff structure. This is an extension of a Port Cost Management Informationi System developed under  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 3 IMPLEMENTATION COMPLETION REPORT the Bank's second Shanghai port project. Since tariffs at major ports are reguLlated by MOC, implementation of the study was coordinated closely with MOC. The computerized tariff system developed under the study is generic and can be used for China's other ports in accordance with requirements of MOF. 15. Institutional Reforms. In 1997 and 1998, SPA made significant institutional changes, reducing the number of its employees, implementing cost-coniscious management, and sharing cargo handling equipment with other terminals. While some activities (e.g., providing early retiremenit packages) temporarily increased expenditures, SPA will benefit in the long term. Project Results 16. All project objectives were achieved during implementation. Private Sector Involvement and Public Terminal Performnance 17. During project preparation, the Shanghai Container Development Company, owned by SPA, and a Hong Kong-based private investor established a joint venture company, SCT, to operate container terminals in Shanghai. This was the first joint venture for container operations in the major ports in China to involve a private investor. SPA used a part of its assets to take a 50 percent share in the company. 18. The Waigaoqiao container terminal was completed uLnder the project and operated entirely by SPA. The productivity of the Waigaoqiao terminal is as high as that of the SCT terminals. Waigaoqiao terminal throughput increased steadily from 11 8,000 teu in 1995 to 675,000 teu in 1998. In 1998, the average throughput capacity of quayside cranes was 129,000 teu, compared to SCT's 127,000 teu. The average container dwelling and vessel waiting times at Waigaoqiao are 4.6 days and 8.6 hours, respectively, compared to SCT's 5.2 days and 9.6 hours (Table 6). 19. The Luojing coal terminal was completed and operational as of January 1, 1998. Because coal traffic decreased at Shanghai Port, Luojing handled only 0.3 million tons. While coal traffic at Luojing terminal is expected to more than double in 1999, traffic will still be low in relation to the 10 million-ton capacity of the terminal. It is recommended that SPA take advantage of the capacity at the Luojing terminal to expedite transferring coal traffic from the city center to Luojing. Meanwhile Luojing is hanidling mineral ore, of which about 2.3 million tons were handled from July 1997 to May 1999. 20. SPA replaced obsolete equipment with new ones at existing terminals. It also reviewed the existing equipment inventory at each terminal and operating company and redistributed equipment, reducing idle time and maximizing their use. 21. One of the major objectives of the project, moving cargo handling out of the city center, is being achieved. Cargo volume handled inside the city decreased from 111.4 million tons (68 percent of total tonnage) in 1996 to 98.0 million tons (60 percent of total tonnage) in 1998, while the traffic outside the city center increased from 53 million tons to 66 million tons. 22. Other expected benefits, including savings in cargo-hanidlinig costs, ship waiting and berthing time, and cargo time, were also achieved. Although the EIRR of 29.2 percent at project completion is lower than the 36.7 percent estimated at appraisal, it is considered satisfactory.  4 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT 23. Cost estimates at appraisal were very reasonable. The final cost is estimated at about Y2,253.3 million, compared to an SAR estimate of Y2,439.4 millioni. Actual US$ project costs amounted to US$314.7 million, about 25 percent lower tlhan the US$424.3 million estimated at appraisal. The lower US$ amount is due to the devaluation of the Yuan and savings achieved from competitive bidding. 24. The cost of procuring equipment was about $32 million lower tlhan expected. Of the project cost savings, $25.74 million was cancelled on November 30, 1995, and $6.89 million went towards increasing the disbursement percentage in the civil works category from 34 percent to 65 percent to match the foreign currency component. The civil works disbursement percentage had originally been set low because of the constraints imposed by the loan amount. 25. No environmental or resettlement problems arose during preparation and implementation. Three hundred seventy families at the site of the Waigaoqiao termnilal were resettled by SPA and received financial compensation and new housing. Discussion with members of randomly selected resettled families revealed that the resettlement terms were generous and satisfactory. Financial Performance 26. Since the project became effective in 1993, three major chaniges have affected the financial condition and the reporting procedures of SPA. 27. New Financial Reporting Procedures. Under regulations from the Ministry of Finance, SPA changed its financial reporting procedures in July 1993 to be consistelnt with international accounting procedures. The new financial reporting procedures require SPA to prepare modified financial reports for subsequent years to accelerate the commercialization of the port. 28. Container Operations. The joint venture container hiandling company SCT established in 1993 now plays a dominant role in port container operations. For example, in 1998, about two- thirds of container traffic at Shanghai port was handled by SCT. 29. Reevaluation of FixedAssets (RFA). The RFA of the port took place twice, in 1992 and 1994. The first RFA was confined to the five major types of hanidlinig equipment; and increased the value of fixed assets by about 13 percent (or Y423.8 million). The second RFA increased the value of fixed assets by about 10 percent (or Y345.6 million). 30. Port tariffs have been regulated on the low side and have not been modified in a timely way to reflect the escalation of prices. SPA's profit shrank because of the gap between price increases and tariff levels. Past Financial Performance 31. The overall financial performance of the port was low compared to projections in the SAR but still is considered acceptable. The total volume of traffic hanidled by the port reached its peak in 1993 (112.6 million tons), decreasing by an average of 4.3 percent each year to 90.5 million tons in 1998 due to the diminution of bulk traffic (coal and fertilizer) passing tllrough the port. For example, in 1997, included in SAR projections, SPA hanidled 91.4 million tons of cargo, 22.6 percent less than the projected 118 million tons. Despite this, actual total operating revenues of Y2.7 billion were only about 7 percent less than the SAR's projection of Y2.9 billion. This makes the actual unit revenue of Y29.6/ton 20 percent higher then the SAR's forecast of Y24.6/ton.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJ.ECT 5 IMPLEMENTATION COMPLETION REPORT 32. The growth of unit revenue came about as a result of two changes in cargo handling operations. First, the tariff table was modified for foreign-going cargo in 1994 and 1997, increasing the tariff by 15 percent in 1994 and 25 percent in 1997. However, these modifications did not fully reflect price escalation, and the low tariffs eroded SPA's profitability. Overall unit revenue was 19.6 percent higher in 1998 than in 1993. This was much lower thanl the domestic price escalation of 50.7 percent for the same period. The slow unit revenue increase (due to the slow growth of Government-regulated tariffs) has reduced after-tax unit profits (profitability) to only 19.1 percent of the 1993 level. The following table summarizes unit revenues. 1993 1994 1995 1996 1997 1998 Unit revenue (Y/ton) 24.3 25.9 31.3 29.4 29.6 29.1 (Index) (100.0) (106.7) (128.8) (120.7) (121.7) (119.6) Unitprofitaftertaxes(Y/ton) 19.7 14.4 9.0 12.9 14.7 3.8 (Index) (100.0) (73.0) (45.6) (65.6) (74.7) (19.1) Annual domestic price escalation (in %) 13.8 21.7 14.8 6.5 1.3 0.0 (Index) (100.0) (121.7) (139.7) (148.8) (150.7) (150.7) Actual profit after taxes (Yuan million) 221.7 142.0 85.4 121.4 134.3 34.0 33. The simulation test shows that if tariffs had growni at the same rate as domiestic prices, in 1998 the port would have generated a YI.35 billion after-tax profit. The return on ANFA, debt service (D/S) coverage, debt/capital ratio and current ratio would have been much higher--25.0 percent, 22.5 percent, 17.8 percent and 2.3 percent, respectively. The results of the simulation test are summarized below. 1993 1994 1995 1996 1997 1998 Simulated unit revenue (Y/ton) 24.3 31.6 43.8 43.7 44.6 43.8 Simulated after-tax profit (Y million) 221.7 686.1 1,233.0 1,437.1 1,480.2 1,347.1 34. The composition of cargo traffic changed from lower-profit coal traffic to higher-profit container traffic. Between 1993 and 1998, coal traffic decreased from 44.3 million tons to 20.9 million tons (or an average of 14.0 percent per year). During the same period, container traffic increased from 8.5 million tons to 27.7 million tons (or an average of 26.7 percent per year). In 1993, container traffic amounted to 7.5 percent of total port traffic, but by 1998, it had increased to 32 percent of the total, compared to 30.6 percent for coal. Port Traffic (million tons) 1993 % of the total 1998 % of the total Average growth (1993) (1998) p.a. (1993-98) Coal 44,333 39.4 20.911 23.1 -14.0% Container 8,474 7.5 27,657 30.6 +26.7% Total SPA 112,641 90,535 -4.3% 35. The financial reporting procedures established in 1993 excluded surcharges (administrative and financial costs) from operating costs, better reflecting the operating efficiency of each business entity. The SAR did not reflect this exclusion in its financial forecast because the report was prepared before the new financial reporting procedures were established. The underestimated surcharges caused the actual after-tax profit to be much lower than the SAR's projection.  6 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT 36. While surcharge costs were higher than anticipated, the SPA improved operating costs until 1997. The lower net profit also caused a lower financial rate of return on1 average net fixed assets. In 1996, internal management reforms and cost-control efforts helped improve the profitability of the port. 37. However, in 1998, rapidly increasing surcharge costs caused the unit profit to decrease to YO.38 /ton. The razor-thin profit in 1998 caused a shortage of internally generated funds as shown below (see more detail in Table- 1 . 1, Annex 1). 1996 1997 1998 (million Yuan) SAR Actual SAR Actual Actual Operating revenue 2,488.0 2,761.9 2,906.0 2.702.0 2,633.0 Less: Operating taxes 87.0 83.9 102.0 86.7 85.0 Operatingcosts 1,644.0 1,869.1 1,899.0 1,738.2 1,790.0 Operating profit 757.0 808.9 905.0 817.1 758.0 Surcharges -- 835.8 -- 900.2 1,072.0 Other incomes (net) (114.0) 208.2 (155.5) 283.5 365.0 Taxes and payments to State 21.0 59.8 23.0 66.1 17.0 Netprofitaftertaxes 603.0 121.4 727.0 134.3 34.0 Average net fixed assets (ANFA) 4,542 3,866 4,970 4,742 5,380.1 Return on ANFA (%) /a 14 5 15 4 1 Operating Ratio /b 68 70 68 69 70 /a: Retum on average net fixed assets operating profitVaverage niet fixed assets. Ib: Operating ratio = operating costs / (revenue-business tax). Present Financial Performance 38. In 1998, D/S coverage was 5.2, which was satisfactory, but much lower than the 21.7 forecast for 1997 in the SAR. In the same year, the debt and capital (DC) ratio reached 30.5 percent, close to the 28.4 percent forecast for 1997 in the SAR, up from 21.2 percent for 1991. The lower-than-expected internally generated funds caused SPA to look to outside financiers to support its capital investment. SPA's borrowing caused the current debt-to-equity ratio to reach 51:49 in 1998, stretching SPA to its financial limit. 39. Furthermore, SPA borrowing is concentrated in short-term debt. In 1998, short-term debt (current liabilities) constituted about 58.9 percent of total debt, or more than triple the SAR's estimates of 17.1 percent for 1997. The high proportion of short-term debt lowered the current ratio to 0.7 (to avoid short-term solvency problems, the current ratio should be more than 1.0). Since the debt service coverage and DC ratio of the port are still in an acceptable range, SPA should consider restructuring its debt by refinancing much of the short-term debt inito long-term debt to maintain the current ratio at 1.0 or higher. 40. The most noteworthy points of the balance sheet are summarized below (see Table 1.2, Annex I for details).  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PRO.IECT 7 IMPLEMENTATION COMPLETION REPORT 1996 1997 1998 (million Yuan) SAR Actual SAR Actual Actual Assets: Fixed assets (net) 4,745.00 5,789.90 5,195.00 6,484.64 7,097.0 Current assets 735.00 2,349.23 760.00 2,507.18 2,511.0 Other assets (net) 287.00 1,676.00 292.00 1,772.40 1,915.0 Total 5,767.00 9,815.13 6,247.00 10,764.22 11,523.0 Liabilities & Equity: Equity 3,431.00 4,989.11 3,891.00 5,474.88 5,577.0 Long-term debt 1,537.00 2,235.37 1,547.00 2,361.27 2,443.0 Current liabilities 313.00 2,590.65 318.00 2,928.07 3,503.0 Special funds 486.00 0 491.00 0 0 Total 5,767.00 9,815.13 6,247.00 10,764.22 11,523.0 Debt: Capital ratio 30.9 30.9 28.4 30.1 30.5 Debt/Equity ratio 32/68 49/51 29/71 49/51 51/49 Current ratio 2.3 0.9 2.4 0.9 0.7 Future Financial Performance 41. Although SPA is making efforts to improve the profitability of its operations, its capital investment program has exerted a heavy toll on SPA's flow of funds (see Table 1.3, Annex 1). The demand on revenue to repay loans in coming years is very high. For example, in 1998, loan servicing constituted 7.3 percent of cash outflow, up from 2.3 percent in 1996. SPA should take steps to strengthen its financial condition, as outlined below. 42. Restructure debt. Since 1993, short-term debt (current liabilities) has exceeded long-termn debt. The port should avoid short-term borrowing to finance long-term investments. 43. Improve liquidity. SPA should shorten its operating cycle to reduce the amount of cash required for operations. The operating cycle is the average number of days it takes to collect accounts receivable plus inventory turnover days. The port's operating cycle is observed to be increasing steadily. A long accounts receivable cycle and increased inventory days (higher operating costs) drain the port's much-needed cash. A shortened operating cycle would improve liquidity. 1995 1997 1998 Number of days to collect accounts receivable 105.9 138.5 150.0 Number of days to liquidate inventory 100.0 112.5 120.0 Operating cycle 205.9 251.0 270.0 44. Management reform. In the face of rapidly increasing overhead, SPA is taking action to control administrative expenditures, including merging its own retirement plan into the city's, and enforcing management reforms at headquarter agencies. Other possible actions include transferring welfare or social activities not directly related to daily operations (e.g., hospitals), along with their operating costs, to municipal agencies.  8 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT 45. Proper Tariff Level. GOC should give port authorities more flexibility by modifying tariff levels in a timely way to reflect actual costs. Since MOC and Shanglhai port have developed a cost-based tariff structure under the project, tariffs should be modified promptly to reflect current local conditions. 46. Economic Reevaluation. The economic analysis in this report is based on t[he reevaluation of SAR estimates of traffic, operational performance, economic costs and the benefits of project components. The methodology used in the ICR is similar to that in the SAR. * Capital investment and maintenance costs have been revised to reflect December 1999 prices and are included in the cost stream. * The benefit stream, also reflected in December 1999 prices, consists of savings in cargo handling, ship port time (berth and waiting), and cargo port time (berth and waiting). * The project life is assumed at 20 years and the capital investmenit period for all berths is from 1991 to 1999. * Benefits started to accrue for container berths, constructioni materials bertlhs and general cargo berths in 1995. For coal berths, benefits started in 1997. 47. Use of the berths changed during project implementation because the composition of traffic changed. The economic analysis for this ICR took into account the cancellation of one bulk ferti l izer berth. 48. In 1998, traffic handled by SPA totaled 90.54 million tons, about 25 percent lower than the SAR's estimated 121.07 million tons. Traffic on the project berths is about 22 percent lower than the SAR's projection (83.13 million tons actual compared to 106.83 million tons projected). Except for the traffic on container berths, the traffic on all other project berths is less than estimated. The increase in container traffic cannot totally offset the combined loss in coal, break bulk and construction materials traffic. The sharp decline in coal traffic from a record-breaking 44.33 million tons in 1993 to 20.91 million tons in 1998, due to cargo owners' constructing their own unloading facilities, affects the overall economic rate of return despite an 18.3-percent economic cost savings in constant December 1999 prices. 49. After assessing the revised data, the reevaluation of the economic internal rate of return for this project is 29.2 percent, which is lower than the SAR estimate of 36.7 percent, but still acceptable. A detailed analysis is presented in Annex 2. 50. The reevaluation of the economic internal rate of return and the SAR estimates of the project in terms of the economic rate of return and the net present value (NPV) are given below. SAR ICR .. , . ... .. .. ............ ........ . .. ". ............ ................ ......... ... ..... -. -~ .... I.. Best estimate of rate of return (%) 36.7 29.2 NPV (12%, million Yuan) 4,585.4 /1 3,260.0 /1: Y2,598.7 million Yuan in Dec. 1992 prices were inflated by the factor of 1.7645 to reflect Dec. 1998 prices.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PRO.IECT 9 IMPLEMENTATION COMPLETION REPORT C. MAJOR FACTORS AFFECTING THE PROJECT 51. Several factors contributed to the success of the project. The project design was straightforward, a single agency was responsible for the development and no complicated coordination between government agencies was required for project implementation. The economy of the region and the country grew, and port traffic, particularly container traffic, the most profitable, increased. 52. At the time of loan approval, SPA was already un1der strong pressure to restructure (i.e., reduce personnel, close three coal berths in the city center, control budgets better) in the climate of China's move toward a market economy. During project implementation, productivity improved further in response to competition between Shanghai port and other ports in the region (Nantong, Zhangjiagang, Ningbo) and between the terminals at Shanghai port (SCT and Waigaoqiao container terminals). Productivity is expected to continue to improve. 53. The project benefitted from SPA's experience in implementinig Bank projects and familiarity with Bank procedures. No major problem in procurement, disbursement, financial auditing, or compliance with legal covenants arose. What was more significant, beginning with the previous projects and continuing through this project, continuity in the staff of the Bank, MOC and SPA helped the project teams establish fruitful relationships with trust and confidelnce on all sides. This contributed to smooth project implementation. 54. There were also negative factors which played a role in project outcome. The Asian financial crisis slowed regional economic growth and cooled the private sector's interest in investing in the region. Since restructuring the port required large private investmenit, the process was hampered by the crisis. Coal traffic also declined during project implementation. Although this might have helped expedite the restructuring of the coal terminals, it served to weaken SPA's financial position, thus limiting SPA's options for restructuring. D. PROJECT SUSTAINABILITY 55. At completion, the project is considered sustainable. Container traffic is expected to continue to grow along with economic development in the Shanghai area and port revenue will increase. SPA has proved that it is as productive at the Waigaoqiao container terminal as the SCT in its joint venture terminal. It is expected that GOC will use the cost-based tariff structure system to modify tariff levels promptly. E. BANK PERFORMANCE 56. The Bank identified and prepared the project in a timely fashion-the project was identified in April 1991 and appraised in May and June 1992. Bank staff resources for the project up to appraisal were 114.7 staff weeks. Bank supervision was efficient, with an average of 11.3 staff weeks per year that included several specialties (see Table 12). This was possible because the supervision of several Bank-financed port and inland waterways projects was well coordinated. 57. With regard to procurement, the Bank took a consistent position and provided guidance when neesr.  10 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT F. BORROWER PERFORMANCE 58. The Borrower's performance was good and preparation and implementationi were adequate. The action plan targets were met substantially during implemenitationi. and as slhowni in Table I0, Part 11, covenants generally were met as well. The Borrower's performance, therefore, was evaluated as highlly satisfactory. G. ASSESSMENT OF OUTCOME 59. This project is assessed as highly satisfactory because it aclieved all major objectives without any shortcomings or delay of the closing date. 60. Net present value was positive, Y3,260 million against Y4,585 million in the SAR, when flows were discounted at 12 percent for a major portion of the investment. EIRR at completion was 29.2 percent as compared to 36.7 percent estimated at appraisal. The project tlherefore would be considered a success in both economic and financial terns. H. FUTURE OPERATION 61. For the future SPA needs to continiue its efforts to transfer facilities away from the city center witlh restructuring of the coal terminal in the city receiving top priority. Plans are at hand for this process as SPA has established guidelines for the land-use plan and is contacting the private sector for participation. 62. SPA needs to continue to restructure, right-sizing personniiel, computerizing the financial accounting system, maximizing equipment use, and reducilng operating costs. 63. To maximize use of bulk facilities, SPA must attract grain and coal traffic. To do so, it needs to monitor coal and grain traffic flows (in relation to the domestic harvest and national energy policies), transshipment patterns in the Shanghai region, and the supply-demand balance dictated by the world market economy (which in turn affects cargo owners' port and termlillal choices). 64. The capacity of Waigaqiao terminal will need to expand furtlher as demand increases. Additional quayside container and rubber-tired gantry cranes will be required to meet future increases in container traffic. SPA also is constructinig an additional 900-in-lonig container terminal with its own funds next to the Waigaoqiao terminal to meet expected future demand. Civil works are substantially complete, but capital investmenit for equipment hlas yet to be secured. To foster intra-port competition among future container terminal operationis, SPA may wishi to consider options, including concession, beyond joinlt venlture arrangements. 65. GOC is deepening the approach channel to the mouthl of the Yangtze River. Wlhen the project is complete, the port will benefit significantly from larger vessels and transport cost savings. While this is a long-term development, SPA should carefully monitor the progress and prepare appropriate scenarios and master plans. I. KEY LESSONS LEARNED 66. Summary of Findings. Competition among ports in the Shanighai region increased significantly in the past five years because of the deregulation of grain cargo, private sector  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 11 IMPLEMENTATION COMPLETION REPORT participation and cargo owners' having their owIn terminals. Shanghlai Port does not have a monopoly of port facilities to serve the Shanghai region, but competes with several neighboring ports (e.g., Nantong, Zhanjiagang, Nanjing). In addition to these ports, some power plants have constructed th-eir own terminals that compete with coal unloadinlg facilities. 67. Significant changes have been made since the Bank's first involvement in Chinla's port sector in 1982. Major port authorities were decentralized from MOC to munLicipalities. Joint venture container terminal operations with foreign operators were started first in Shanghai and then in other ports (e.g., Dalian, Shenzheng, Tianjin, Xiamen, Fuzhou and the Guangdong area). While port authorities are now more aware of the role of the port as a vital transport link with other transport modes (rail and roads), policy coordination in the central governmeent needs to be strengthened to improve the efficiency of multi-modal transport. 68. Key Lessons Learned. Public sector performance is compatible to that of the joint-venture if conditions are right as evidenced by SPA's performance at Waigaoqiao terminal which was in fact better than SCT's performance. This is possible because of the competitive environment under which SPA and SCT operated. Given this finding, it would be worthwhile for the Bank to consider providing further assistance to the port sub-sector if the introductioll of more open competition is proposed. 69. SPA's past experience in completing two Bank-finanlced projects satisfactorily was a factor of successful implementation. SPA was familiar with Bank procedures and policy requirements; tIIus, no confusion in procurement procedures and compliance with legal covenants arose. 70. Continuity of staff played a role in the project's success as well. Both SPA and the Bank maintained the same multidisciplinary teams.  12 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 13 IMPLEMENTATION COMPLETION REPORT PART II. STATISTICAL TABLES TABLE 1: SUMMARY OF ASSESSMENTS A. Achievement of objectives Substantial Partial Negligible Not applicable Macro policies x Sector policies x Financial objectives x Institutional development x Physical objectives x Poverty reduction x Gender issues x Other social objectives x Environmenital objectives x Public sector management x Private sector development x Other (specify) x B. Project sustainability Unlikely Uncertain x Highly C. Bank performance satisfactory Satisfactory Deficient Identification x Preparation assistance x Appraisal x Supervision x D. Borrower performance Preparation x lminplementation x Covenant compliance x Operation (if applicable) x E. Assessment of outcome x  14 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 2: RELATED BANK LOANS/CREDITS Loan/credit title Purpose Year of approval Status Preceding operation I. Three Ports Project expansion 1982 completed on 6/30188 2. Tianjin Port Project expansion 1986 completed on 10/31/94 3. Huangpu Port Project expansion 1987 completed on 12/31/94 4. Dalian Port Project expansion 1988 completed oni 12/31/93 5. Ningbo and Shanghai Ports Project expansion 1988 completed on 12/31/95 5. Xiamen Port Project expansion 1988 completed on 3/31/95 6. Ship Waste Disposal Project environment 1992 completed on June 30, 1997 TABLE 3: PROJECT TIMETABLE Item Date planned Date actual Identification March 1991 April 1991 Pre-appraisal September 1991 October 12-22, 1991 Appraisal February 1992 May 24- June 10, 1992 Negotiations June 1992 October 26-30, 1992 Board approval August 1992 December 12, 1992 Signature January 14, 1993 January 14, 1993 Effectiveness April 14, 1993 May 13, 1993 Project completion June 30, 1999 June 30, 1999 Loan closing June 30, 1999 June 30, 1999  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 15 IMPLEMENTATION COMPLETION REPORT TABLE 4: LOAN DISBURSEMENT Planned Actual Period Loan (in US$) Loan (in US$) Disbursements Cummulative Disbursements Cummulative disbursements Disbursements 6/30/92 - 9/30/92 0 10/1/92 - 12/31/92 0 0 1/1/93 - 3/31/93 2,000,000 2,000,000 4/1/93 - 6/30/93 0 2,000,000 6/30/93 - 9/30/93 2,500,000 4,500,000 10/1/93 - 12/31/93 4,500,000 9,000,000 3,004,570 3,004,570 1/1/94 - 3/31/94 3,800,000 12,800,000 749,984 3,754,554 4/1/94 - 6/30/94 3,700,000 16,500,000 2,318,321 6,072,875 7/1/94 - 9/30/94 3,800,000 20,300,000 5,964,470 12,037,345 10/1/94 - 12/31/94 3,700,000 24,000,000 5,704,070 17,741,415 1/1/95 - 3/31/95 7,500,000 31,500,000 7,208,832 24,950,247 4/1/95 - 6/30/95 7,500,000 39,000,000 17,678,570 42,628,817 7/1/95 - 9/30/95 9,000,000 48,000,000 22,051,516 64,680,333 10/1/95 - 12/31/95 9,000,000 57,000,000 16,986,000 81,666,333 1/1/96- 3/31/96 7,500,000 64,500,000 10,657,517 92,323,850 4/1/96 - 6/30/96 7,500,000 72,000,000 12,222,254 104,546,104 7/1/96 - 9/30/96 9,000,000 81,000,000 4,619,510 109,165,614 10/1/96 - 12/31/96 9,000,000 90,000,000 4,402,999 113,568,613 1/1/97 - 3/31/97 6,800,000 96,800,000 0 113,568,613 4/1/97 - 6/30/97 6,700,000 103,500,000 2,193,984 115,762,597 7/1/97 - 9/30/97 8,000,000 111,500,000 3,048,047 118,810,644 10/1/97 - 12/31/97 8,000,000 119,500,000 0 118,810,644 1/1/98 - 3/31/98 10,000,000 129,500,000 339,600 119,150,244 4/1/98 - 6/30/98 10,000,000 139,500,000 477,291 119,627,535 7/1/98 - 9/30/98 4,000,000 143,500,000 189,032 119,816,567 10/1/98 - 12/31/98 4,000,000 147,500,000 177,015 119,993,582 1/1/99 - 3/31/99 2,000,000 149,500,000 382,687 120,376,269 4/1/99 - 6/30/99 500,000 150,000,000 0 0 7/1/99 - 9/30/99 0 150,000,000 0 0 10/1/99 - 12/31/99 0 150,000,000 -308,021 120,068,248 Cancellation amount on 11/30/95: US$25,740,000 Undisbursed: US$4,191,752  16 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 5A: KEY INDICATORS FOR PROJECT IMPLEMENTATION Planned Actual Action Responsible Unit Start Date Start Date 1. Waigaoqiao Civil Works SPA Engineering Dept. Started on July 30, Started on July 1991 30, 1991 Equipment SPA Technology Dept. September 1, 1992 September 10, 1992 2. Luojing Civil Works Channel SPA Engineering Dept. July 1, 1993 July 1, 1993 Reclamation SPA Engineering Dept. July 1, 1993 July 1, 1993 Marine Structures SPA Engineering Dept. January 1, 1994 December 1, 1994 Shore Works SPA Engineering Dept. April 1, 1994 December 1, 1994 Communications SPA Engineering Dept. January 1, 1996 July 1, 1996 Access road, etc. SPA Engineering Dept. July 1, 1994 July 1, 1994 Utilities SPA Engineering Dept. July 1, 1994 July 1, 1994 Equipment SPA Technology Dept. September l, 1993 June 17, 1994 3. Existing Terminals Equipment SPA Technology Dept. January 1, 1993 June 6, 1994 4. Port Costing SPA Financial Dept. Within one year of June 30, 1992 completion of PCMIS 5. Tariff Restructuring SPA Business Dept. Within 6 months of October 30, 1998 installation of port costing 6. Consultant Services Luojing Terminal Design Third Research & Design Started on June 1, 1992 June 1, 1992 Institute Cargo Unitization Study SPA Technology Dept. June 1, 1993 June 30, 1992 Accounting SPA Financial Dept. June 1, 1994 January 1, 1992 computerlization Corporate Planning SPA Management June 30, 1994 January 1, 1995 Development of MIS SPA Management January 1, 1996 January 1, 1995  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 17 IMPLEMENTATION COMPLETION REPORT TABLE 5B: TRAINING (OVERSEAS TRAINING) Planned Actual Number Person- Number of Person- Country Implemented of Person Month Person Month Accounting 7 7 7 7 USA Management 4 1 5 4 15 Italy Tariff management 7 5 .25 7 5 .25 USA Operators 233 116 .1 233 116 .1 Austria, Canada, Finland, France, Germany, Italy, Japan, Korea, Netherlands, Sweden, UK, USA Total 251 143 .4 251 143 .4 TABLE 5c: PROCUREMENT SCHEDULE (for contracts over US$1.0 million equivalent) No. Item No. Issuing Bid Evaluation Days for Contract of Bid Opening Report to Evaluation Price (US$ unit the Bank Equivalent) I Portal Crane 5 06/02/93 07/15/93 09/18/93 65 3,087,000 2 Towing Tractor 28 06/02/93 07/15/93 03/25/94 217 1,146,473 3 Shovel Loader 6 06/02/93 07/15/93 09/18/93 65 1,147,270 4 Quay Crane 1 07/01/93 08/20/93 01/12/94 145 3,318,000 5 Gantry Crane 2 07/01/93 08/20/93 01/12/94 145 2,482,203 6 Tug Boat 1 10/11/93 12/01/93 04/19/94 139 2,250,000 7 Traffic Boat 1 10/11/93 12/01/93 04/19/94 139 1,900,000 8 Computer System 1 04/10/96 06/10/96 08/22/96 73 (2nd Stage) 10/22/96 01/29/97 99 1,349,120 9 Bucket Unloader (1,250 t/h) 2 06/17/94 09/23/94 01/05/95 104 12,028,809 10 Grab Unloader (1,250 t/h) 1 06/17/94 09/23/94 01/05/95 104 4,085,500 11 Conveyer Belt System 1 06/17/94 09/23/94 01/05/95 104 20,543,760 12 Tug Boat (2352Kw) 1 01/23/95 03/25/95 06/21/95 88 2,620,000 13 Civil Works for Luojing 1 07/11/94 09/15/94 09/28/94 13 15,518,434 14 Portal Crane (10 T) 16 06/06/94 07/26/94 11/15/94 112 7,679,600 15 Portal Crane (16 T) 5 06/06/94 07/26/94 11/15/94 112 3,403,500 16 Portal Crane (25 T) 3 06/06/94 07/26/94 11/15/94 112 2,655,200 17 Bulldozer 30 06/06/94 07/26/94 11/15/94 112 3,831,021 18 Wheel Loader (3.1 m3) 21 06/17/94 08/04/94 02/07/95 187 1,558,234 19 Wheel Loader (3.7 m3) 35 06/17/94 08/04/94 02/07/95 187 4,098,639 20 Forklift Truck (16 T) 13 06/17/94 08/04/94 12/13/94 131 1,609,108 21 Prime Mover 14 06/17/94 08/04/94 12/13/94 131 1,034,484 22 Tug Boat (2500Kw) 2 01/23/95 03/25/95 05/10/95 46 4,990,000  18 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 6: KEY INDICATORS FOR PROJECT OPERATIONS Productivity of Container Handling at Shanghai Container Terminal (Joint Venture) and Waigaoqiao Terminal Joint Venture (JV) Waigaoqiao Terminal Terminal Year 1992 1995 1998 1998 (before JV) Physical Performance 1. Annual Throughput (teus) 716,000 1,290,000 2,027,000 675,000 2. Length of the reeminal (meter) 1,465 2,281 2,281 900 3. Throughput/quay length (Teus/m) 489 566 889 750 4 No. of Gantry Cranes (units) 8 12 16 5* (5 plus one mobile crane) 5. No. of Berth 5 7 7 3 6. No. of Rubber-tyred Gantry Cranes (units) 23 52 52 16 7. Gantry Crane Productivity (teu/crane) 89,500 107,500 126,688 129,163 *+ 8. Operating hours of quay crane (hours/crane) 4.171 3,760 4,044 3,720 9. Productivity of a quay crane (Teus/net-hour/crane) 21 29 31 35 10. Average Dwell Time of Containers in the Port (days) 5.9 5.6 5.2 4.6 1 1. Average Vessel Turnaround Time (hours/vessel) 23.0 22.9 19.3 20.0 12. Average Vessel Waiting Time (hours/vessel) 14.5 14.1 9.6 8.6 Financial Performance 1. Operating Ratio (%) 49 51 44 46 (Total Operating Costs)/(Operating revenue - Operating Taxes) 2. Working Ratio (%) 38 28 25 25 (Operating Costs - Depreciation)/(Operating Revenue - Operating Taxes) 3. Self Financing Ratio (%) 56 29 (Average of the Last 3 Years' Total Investment)/(Net Profit + Depreciation) 4. Handling Charge (Loading or unloading) (Yuan/TEU) 400 40)0 320 Institutional Performance 1. No. of Employees, including Terminal Operators 1,765 1,835 1,036 2. Productivity of staff (Teus/staff) 730,878 1,104,632 651,544 * There were five quay side cranes (handling.645,815 teus) and one mobile crane (handling 29,185 teus) in 1998. * * This number applies only to the five quayside cranes 645,815/5 = 129,163  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 19 IMPLEMENTATION COMPLETION REPORT TABLE 7: STUDIES INCLUDED IN PROJECT Corporate Planning 1. The major objective of the study was to establish a corporate plannling process to assist the senior management and other key individuals within SPA to introduce plans and strategies to: (a) develop efficient and reliable port organization and improve the corporate image of SPA, (b) promote the use of SPA facilities by shipping, cargo and other interests, and (c) maintain and develop controls through management policies and objectives and monitoring of investments. The study was undertaken by SPA with assistance from a corporate planning expert (an international consultant). The report was satisfactorily completed. The Corporate Plan served as reference in restructuring and development in the Port of Shanghai. Bulk Fertilizer Operations 2. The objectives of the study were to: (a) identify current and future demands in the bulk fertilizer operation in the Port of Shanghai, (b) determine the necessity to move the operation from the city's center; and (c) review the feasibility of implementing the move. The study was undertaken by the Shanghai Port Design Research Institute of SPA and was started in May 1996 after SPA confirmed that bulk fertilizer traffic was not increasing. In May 1997, the final report proposed that bulk fertilizer operations should be moved from the city center in accordance with the master plan of Shanghai city and port. The proposed location, Waigaoqiao, was considered ideal for bulk fertilizer, and the shift of operations would be carried out in conjunction with implementation of the urban development master plan of the city of Shanghai. Dangerous Cargo Handling 3. The objectives of the study were to: (a) identify current and future trends of dangerous cargo operations, (b) review the current methods of handling dangerous cargo, (c) define the possible dangers and impacts on the environment at each handling point, and (d) devise a plan to handle the dangerous goods operations in accordance with safety protection measures. The study was undertaken by the Shanghai Port Design Research Institute of SPA. The study concluded that the operational areas for dangerous cargo in Huangpu River should be removed or reduced in accordance with the urban development master plan of the city and the master plan of the port. At present, efforts should be made to allocate limited berths for dangerous cargo to facilitate implementation of safety measures and monitoring of contamination. Unitization of General Cargoes and Its Operation 4. The objective of the study was to unitize the break-bulk cargo to enhalnce operational efficiency and reduce handling costs, specifically to: (a) identify ways of cargo unitization, mainly container, (b) analyze handling efficiencies and vessel berthing times of unitized and non- unitized operations, (c) encourage cargo unitization by owners of ships and cargo and by ports of loading and (d) prepare an action plan to promote unitization over the entire port. The study was undertaken by the Shanghai Port Design Research Institute of SPA. The objectives of the study have been achieved, particularly in container operations, which in recent years saw annual growth of 27 percent.  20 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT Port Tariff Restructuring 5. The objective of the study was to develop software for a cost-based port tariff structure to reflect actua; costs. This was an extension of the PCMIS developed under the Bank-financed Ningbo and Shanghai Port Project. The study was carried out by international and domestic consultants with coordination by the Department of Water Transport of the Ministry of Communication, which was responsible for national port tariffs. Software development and installation, the hardware set-up, and user training were satisfactorily carried out in June 1999.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 21 IMPLEMENTATION COMPLETION REPORT TABLE 8A: PROJECT COST Planned Actual Local Foreign Total Local Foreign Total Local Foreign Total Local Foreign Total - (Yuan Million) ----- ----- (USS Million) ---- ------ (Yuan Million) ----- ------ (US$ Million) ----- A. Civil Works a. Luojing 543.21 71.04 614.25 99.67 13.03 112.71 597.78 129.93 727.71 72.86 15.59 88.45 b. Waigaoqiao 345.85 65.87 411.72 63.46 12.09 75.54 710.65 0.00 710.65 114.06 0.00 114.06 Subtotal 889.06 136.91 1,025.97 163.13 25.12 188.25 1,308.43 129.93 1,438.36 186.92 15.59 202.51 B. Equipment a. Luojing 58.42 197.56 255.98 10.72 36.25 46.97 33.27 320.61 353.88 4.00 38.57 42.57 b. Waigaoqiao 16.35 163.50 179.85 3.00 30.00 33.00 10.08 194.28 204.36 1.22 23.18 24.40 c. Existing Terminal 33.79 337.90 371.69 6.20 62.00 68.20 19.97 227.43 247.40 2.39 41.73 44.12 Subtotal 108.56 698.96 807.52 19.92 128.25 148.17 63.32 742.32 805.64 7.61 103.48 111.09 3.TA&training 0.59 5.47 6.06 0.11 1.00 1.11 0.95 8.31 9.26 0.11 1.00 1.11 Subtotal 0.59 5.47 6.06 0.11 1.00 1.11 0.95 8.31 9.26 0.11 1.00 1.11 Total Base Cost 998.21 841.34 1,839.55 183.16 154.37 337.53 1.372.70 880.56 2,253.26 194.64 120.07 314.71 Physical contingency 99.77 83.59 183.36 18.31 15.34 33.64 Price contingency 211.95 204.50 416.45 27.03 26.04 53.07 Grand Total 1,309.93 1,129.43 2,439.36 228.49 195.75 424.25 1,372.70 880.56 2,253.26 194.64 120.07 314.71 For the comparison of Planned and Actual Costs, the foreign component was calculated at $120.07 million. Grand Total 1,657.76 654.38 2,312.14 304.18 120.07 424.25 TABLE 8B: PROJECT FINANCING ($ million) Appraisal estimate Actual/late estimate Source Local Foreign Total Local Foreign Total Bank 6.0 9.0 15.0 - 15.401 15.401 GOCandthePortAuthorities 19.8 - 19.8 21.861 - 21.861 Total 38.8 26.0 64.8 21.861 47.749 69.611 TABLE 8C: ALLOCATION OF PROCEEDS Planned Actual Amount of the Loan % of Amount of the Loan % of Allocated Expenditure Allocated Expenditure Category (in US$ Equivalent) to be Financed (in US$ Equivalent) to be Financed (1) Civil Works 8,830,000 34% 8,830,000 62% (2) Goods 124,660,000 100/100/75% 124,660,000 100/100/75% (3) Consultants' services 1,650,000 100% 1,650,000 100% and training (4) Unallocated 14,860,000 Cancelled Total 150,000,000 134,000,000  22 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 9: ECONOMIC COSTS, BENEFITS AND MAJOR FINANCIAL INDICATORS Planned Actual 1993 1994 1995 1996 1997 1993 1994 1995 1996 1997 Financial Working ratio (%) 61 60 60 59 59 68 70 72 70 69 Operating ratio (%) 71 71 70 69 68 Self-financing ration (%) 20 45 45 45 45 44 27 45 30 28 Return on net fixed assets(%) 10 1 1 13 14 15 14 13 8 5 4 Dept/equity ratio 27/73 3 1/69 33/67 31/69 28/72 22/78 37/63 36/64 45/55 47/53 Dwell Time of Cargo in Port (days) Coal 20 18 16 14 10 20.8 23.1 19.8 25.1 21 Containers (loaded) 10 9 8 7 5 15.8 7.7 5.6 7.7 5 General cargo 14 12 10 8 7 14 11.5 14.2 14.2 12 Others 14 12 10 8 7 14 11.5 14.2 14.2 12 Ship Stay in Port (days) Foreign vessels 3.5 3.3 3.0 2.7 2.5 4.3 2.4 2.1 1.9 2 Chinese/foreign going vessels 4.5 4.2 4.0 3.8 3.5 4.5 3 2.6 2.1 2.1 Domestic trade vessels 1.8 1.5 1.2 1.0 1.0 0.9 0.7 0.7 0.7 1 Non-productive Time at Berth (% time vessel not working while alongside) Bulk cargo vessels 15% 14% 13% 12% 11% 41% 34% 30% 24% 24% Containervessels 25% 25% 23% 21% 20% 64% 51% 63% 62% 62% General Cargo vessels 30% 30% 28% 28% 26% 51% 45% 42% 43% 43% Equipment Utilization Ratio (%) Berth Handling Equipment 85% 86% 87% 88% 89% 90% 92% 93% 94% 94% Container Quay Crane 75% 75% 77% 79% 80% 93% 83% 94% 96% 96% 70% 70% 72% 72% 74% 92% 93% 94% 94% 94% Mobile Crane 70% 70% 70% 70% 70% 90% 92% 92% 93% 93% Rubber Tyred Gantry Crane 70% 70% 70% 70% 70% 79% 86% 94% 97% 97% Tractors 70% 70% 75% 75% 75% 89% 90% 92% 92% 92% Others 60% 60% 60% 60% 60% 91% 92% 93% 94% 94%  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 23 IMPLEMENTATION COMPLETION REPORT TABLE 10: STATUS OF LEGAL COVENANTS Cove- Original Revised Agree- nant Present Fulfillment fulfillment ment Section class Status date date Description of covenant Comments Loan 4.01 1 C Submit Annual Audit Report for Submitted on time Project Accounts to the Bank by Jl.nle 30, each year. Project 4.01 1 C Submit Aniual Audit Report for the Submitted on time. financial statements (balance sheet, statement of incone and expenses and related statements). 4.02 1 CP Achieve debt service coverage ratio Complied with, of 1.4 times for FY93 and 2.5 except in FY94 thereafter. when the ratio was 0.6. 4.03 1 CP 10/31/94 Achieve working ratio of 61% after Complied with in FY92. FY92 and the rest was around 64- 69%. Schedule 2, 10 CD 10/31/94 Complete a Cargo Unitization Stidy. Completed in para. 1 January 1994. Scliedule 2, 10 C 12/31/94 Slhift bulk fertilizer hiandling to Completed in May para. 2 \AWaigaoqiao 1997 (postponed to m-onitor the fluctuated demand). Schedule 2, 10 C 12/31/94 SPA shall install a computer based Completed in June para. 3 (a) and and port costing and management 1999 (delayed due (b) 6/95, intformation system (PCMIS) and to the required respectively restructure tariff coordination with MOC). Sclhedule 2, 10 CD 06/30/94 SPA sliall prepare and send to the Completed in July para. 4 Bank a proposal for a corporate 1995. planning system. Covenant Class: Status: I = Accounts/audits 8 = Indigenous people C = covenant complied with 2 = Financial performance/revenue 9= Monitoring, review, and reporting CD = complied with after delay generation from beneficiaries 10 = Project implementation not CP = complied with partially 3 = Flow and utilization of project covered by categories 1-9 funds 11 = Sectoral or cross-sectoral 4 = Counterpart funding budgetary or other resources 5 = Management aspects of the allocation project or executing agency 12 =Sectoral or cross-sectoral policy/ 6 = Environmental covenants regulatory/institutional action 7 = Involuntary resettlement 13 = Other TABLE 11: COMPLIANCE WITH OPERATIONAL MANUAL STATEMENTS There was no significant lack of compliance with an applicable Bank Operational Manual Statement (OD or OP/BP)  24 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 12: BANK RESOURCES: STAFF INPUT (Unit: Staff weeks) Task/FY 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Total Preappraisal 6.4 29.6 38.8 74.8 Appraisal 15.9 24.0 39.9 Negotiations 3.6 3.6 Supervision 10.0 24.0 8.0 11.3 7.0 8.1 10.5 78.9 Completion Total 6.4 29.6 54.7 37.6 24.0 8.0 11.3 7.0 8.1 10.5 197.2 TABLE 13: BANK RESOURCES: MISSIONS Performance rating Number Imple- Types of Stage of project Month/ of Days in Specialized staff skills mentation Development problems cycle year persons the field represented /a status /b objectives /b Identification 04/91 7 EC, EGR, OP, FA, ENV, FA/EC Preparation 05/91 7 EC, EGR, ENV, OP, FA, FA/EC Preappraisal 10/91 6 EC, EGR, OP, FA, FA/EC Appraisal 05/92 5 EC, EGR, OP, FA, FA/EC Supervision 1 03/93 3 EC, EGR, OP HS HS Supervision 2 08/93 2 OP, EGR S S (1) Supervision 3 10/93 2 FA, EC S S Supervision 4 11/93 2 EGR, FA/EC S S Supervision 5 11/94 3 EGR, FA, ENV S S Supervision 6 09/95 2 EGR, FA S S Supervision 7 12/95 2 EGR, FA/EC S S Supervision 8 04/96 3 3 EGR, FA/EC, ENV S S Supervision 9 10/96 2 6 EGR, FA/EC S S Supervision 10 04/97 3 2 EGR, FA/EC, ENV S S Supervision 11 11/97 2 10 EGR, FA/EC S S Supervision 12 5/98 1 2 FA/EC S S Supervision 13 6/98 1 3 EGR S S Supervision 14 11/98 2 7 EGR, FA/EC S S Completion 06/99 2 16 EGR, FA/EC S S /a EC: Economist; EGR: Engineer; ENV: Environment Specialist, FA: Financial Analyst; OP: Operations Specialist; RES: Resettlement Specialist /b HS: Highly satisfactory; S: Satisfactory (1) Bank's management advised that projects in the initial stage should not be rated "HS".  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 25 IMPLEMENTATION COMPLETION REPORT APPENDIX A: ICR PREPARATION MISSION AIDE-MEMOIRE CHINA SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT (LN. 3552-CHA) SUPERVISION MISSION, MAY 25-JUNE 2, 1999 AIDE-MEMOIRE 1. A World Bank mission comprising Messrs. T. Tsutsumi and H.K. Yen visited Shanghai Port from May 25 to June 2 to review project implementationi. This aide-memoire records the discussions, understandings and agreements reached and recommendations made with SPA). The recommendations of the mission, as incorporated in this aide-memoire, are subject to review and confirmation by the Bank management. The mission expressed its gratitude for the cooperation and courtesies extended by the officials of SPA. A list of key officials met by the mission is attached in Annex 1. 2. Progress of the Project. All contracts have been signed. All civil works and supply of equipment have been completed. Technical assistance (studies), and training have substantially been completed and the project is expected to be completed by June 30, 1999, as originally planned. The remaining payments and their expected completion date are as follows: Remaining Components Undisbursed Balance Expected Completion (in US$) Waigaoqiao Management Information System 150,000 June 30, 1999 Commodity Inspection Equipment 150,000 June 30, 1999 Spare-parts 89,000 June 30, 1999 Tariff Study 80,000 June 30, 1999 Total 469,000 June 30, 1999 3. Waigaoqiao Management Information System (MIS). Hardware and all network have been installed and software has been developed. Container operation system withiin MIS has been operational since November 3, 1998, and now is under testing and verification stages. SPA expects that the final acceptance will be completed by June 30, 1999. 4. All commodity inspection equipment has been delivered to Port of Shanghai. Payment will be completed by June 30, 1999. 5. Tariff Study is progressing satisfactorily under the coordination of Ministry of Communications (MOC). Training of responsible staff in SPA has been completed and software development is being completed. The study is expected to be completed by June 30, 1999. 6. Traffic Performance. The port traffic has been consistently decreasing since reaching its highest record in 1993 (112.64 million tons). The average annlual rate of the decrease is 4.3% between 1993 and 1998. In 1998, the port handled 90.54 million tons of cargoes slightly less (0.82 million tons or 0.9%) than 91.36 million tons in 1997. The main reason for reduction of the  26 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT traffic was decrease in coal traffic (3.83 million tons of 15.5%), from 24.74 million tons in 1997 to 20.91 million tons in 1998. The decrease in coal is mainly due to the clhange of the energy policy. The government is planning to further reduce the nation's coal production in 1999. 7. In contrast to coal, the container traffic is growing very fast. The average growth rate during the last five years (1993-98) was 26.7%. Despite the impact of financial crisis in East Asia in 1998, container traffic still grew by 20.6% and has become the biggest single item of SPA (30.6% of the total port traffic). It is expected that the growth would contilnue. Given the government economic policy and the Shanghai regional development, it is also expected tlhat the overall annual port traffic will stabilize around 90.0 million tons in coming years and grow slowly thereafter. 8. Financial Performance. The mission reviewed and discussed the port's 1998 financial statements. A decrease in coal traffic has less impact on the financial condition, because SPA had better control of its operating cost and the loss of coal revenue was almost totally absorbed by the much profitable container handling. Inl998, the unit operating cost only increased by 0.5% raising from 19.68 Yuan! ton in 1997 to 19.77 Yuan/ton in 1998, Despite 15.5% decrease in coal, the unit revenue only reduced by 1.7% from 29.58 Yuan/ton in 1997 to 29.08 Yuan/ton in 1998. Total operating profit for 1998 was 758 million Yuan (or only 7.2% less then 1997). 9. The fast increases in surcharges (mainly administrative and financial charges) haseroded all operating profits. Without the profit transfer from Shanglhai Container Terminal Ltd. (SCT)- a joint venture company to SPA, SPA would have been facing the negative operational profits After cash injection from SCT, the 1998 income statement of SPA showed a 34.0 million Yuan net profit after tax. Although the final financial result of SPA in 1998 was still considered acceptable, it is clearly revealed that the increase of surcharge costs were very hiigh. Between 1997 and 1998, surcharge costs were increased by 18.8% to 1.07 billion Yuan, including 220 million Yuan of financial costs which increased by 76%. The mission recommlaenided SPA to access the reasons of increase and take necessary actions to control the growth of tlhis account. 10. Auditor's Report. The mission requested, and SPA agreed, to submit an auditor's financial report for 1998 to the Bank before June 30, 1999. 11. Preparation of the Implementation Completion Report (ICR). The mission discussed with SPA technical, economic, financial and institutional aspects and collected additional information. The mission provided to SPA an outline of the ICR. SPA has also provided "Borrower's Contribution for the ICR". The agreed timetable for the preparation of the ICR is as follows: (a) SPA will provide comments for the outline of the ICR by Junle 30, 1999. (b) Bank will send a draft ICR to SPA and MOC for comments by November 20, 1999. (c) SPA, in combination with MOC, will send comments to the Bank by December 10, 1999. (d) Bank will finalize the ICR and send to Secretary of the Board by December 31, 1999. 12. SPA agreed to further cooperate in preparation of the ICR by providing additional information to the Bank, if requested. June 1, 1999 Shanghai, China  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 27 IMPLEMENTATION COMPLETION REPORT Annex 1 Key Officials Met Shanghai Port Authority (SPA) Mr. Yu Baozhong, Deputy Chief Engineer, SPA Mr. Ma Zhongbei, Economist, Planning Department Mr. Wang Qingwei, Deputy Director, Financial Department Mr. Yang Yumin, Accountant, Financial Department Mr. Zhao Limeng, Tariff Analyst, Operation Department Mr. Zhang Jiafu, Engineer, Technical Department Ms. Guo Xiaolian, Economist, Planning Department Mr. Fan Lili, Engineer, Foreign Affairs Department Shanghai Container Terminals Ltd. (SCT) Mr. Yuang Zhigeng, Deputy General Manager, SCT Shanghai Waigaoqiao Free Trade Zone Stevedoring Co. (WSC) Mr. Shi Siming, Deputy General Manager, WSC  28 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PRO.IECT 29 IMPLEMENTATION COMPLETION REPORT APPENDIX B: BORROWER'S CONTRIBUTION TO THE ICR General Assessment Shanghai Port Restructuring and Development Project (Loan 3552-CHA) (Prepared by Shanghai Port Authority) Portion I I. The World Bank's loan package of Shanghai Port Restructuring and Development Project (3552-CHA) implemented by Port of Shanghai with total amount of 150 million U.S dollars covers Phase I of Waigaoqiao, Phase I of Luojing Coal Terminal and procurement of relevant equipment for pre-existing terminals. The loan is mostly for purchase of machines and equipment with partly being for civil works. The acquisition of all items is tlhrough international competitive bidding as directed by the World Bank with exception of small quantity of equipment that were procured via domestic competitive bidding. II. Civil works of Phase I of Waigaoqiao was formally initiated on July 30, 1991, basically completed by October 1993 and accepted by the State in October 1994. The works that proves high quality was put into operation same year. 4 newly-constructed 10,000-Ton classification berths created 2.4 million tons of handling capacity. The construction of civil works of Phase I of Luojing Coal Terminal saw its inception on July 1, 1993, the works was basically completed by December 30, 1996 and approved/accepted by the State on1 July 30, 1997. The works proves high quality and was put into service same year. The creation of these two newly-built 10,000-ton berths gets 10 million tons of additional capacity. Aforesaid two terminals have acquired 6 pieces of new 10,000-ton classification berths, suggesting 12.40 million tons of additional capacity. Equipment procurement for pre-existing terminals began in June 1994 and was accomplished by end of December 1995. Procurement of associated equipment for these three Bank's financed projects was successfully completed by end of December 1995 following initial international bidding in July 1993. Of all 398 sets/pieces including 275 sets/pieces obtained from worldwide bidding and 123 sets/pieces from locally, 78 sets/pieces for Phase I of Waigaoqiao terminal, 16 sets/pieces for Luojing Coal Terminal and 181 sets/pieces for pre-existing terminals were acquired though international competitive bidding, plus another 123 sets/pieces for Phase I of Waigaoqiao terminal that were obtained through the bidding locally. III. The project proves a rationalization in overall layout, handling technology and berth structure design, plus reliable parameters of equipment with fairly high level of automation of its handling technology. By and large, the project was successful with all targets having been achieved and Port's throughput capacity substantially increased. Statistics show that 19.191 million tons of accumulated throughput were handled by end of 1998 since Phase I of Waigaoqiao terminal was put into service, suggesting 3.19 million tons of yearly average growth.  30 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT Phase I of Luojing Coal Terminal has created 4.799 million tons of throughLput since end 1998 when Phase I was completed. IV. During the period of implementation of the pro ject, internationial bidding was adopted into process of equipment procurement, making contribution to cut-down cost of individual equipment and improvement of handling technology, plus a few techniicianis getting their training courses. Thanks to newly-constructed berths together with added necessary equipment plus handling capacity enlarged, the Port lhas eventually kept pace with the demands of ever increasing transportation. V. The Project comprises 6 pieces of 10,000-ton classification berths (3 for general cargo, I for container and 2 for coal handling ). These additional berths have contributed to enhancement of integral capacity and functions, ideally stimulating increase of Port's throughput. By end of 1998 the whole Port witnessed 163.88 million tons of yearly througlhpLut. VI. The loan (3552-CHA) falls into 5 technical assistance items: A. Study on corporation planning. started in May 1993 and ended in July 1995, this study was jointly undertaken by those retained professionals who were granited by the Bank. The conclusive study report was submitted to the Bank in 1995. B. Study on relocation of bulk fertilize handling operation in Port of Shaniglhai. This one- year long study (May 1996 to May 1997) was completed with submission of the report to the Bank in 1997. C. Study on dangerous cargo in Port of Shanghai. Began in May 1996 and finished by July 1997, the report of this study was submitted to the Bank in 1997. D. Study on unitization of break-bulk cargo hanidlin1g and transport in Port of Shanghai. This study (from March 1993 to January 1994) was concluLded with submission of relative report to the Bank in 1994. E. Study on port tariff in Port of Shanghai. The participants for this study were from both Water Transportation Department of MOC and Shanghai Port ALuthority with former being as contact to the Bank. Shanghai Port Authority formally reached a workinig contract with Huazheng Accountant Software Company of Ministry of Finance in September 1998 with the concurrence of the Bank. This target has been basically achieved. F. All of above-listed technical assistance items have reflected the demand by the Bank in its evaluation report. The Port could take this case as a reference to extend for future expansion and development. VII. In the process of terminal construction and equipment procurement, we have paid attention to both environmental and safety aspects. We have strictly followed associated rules and regulations of the State by configuring environment protection measures into relevanit portions of the Project, for instance sewage treatment, dust control instrumentation. Local environmental protection agency felt fairly satisfactory over various criteria as result of inspection  SHANGHAI PORT RESTRUCTURrNG AND DEVELOPMENT PROJECT 3! IMPLEMENTATION COMPLETION REPORT VIII. In order to exact international bidding procurement, Shanghai Port Authority has desirably set up a dedicating agency of "Office of Bidding for World Bank Financed Equipment Procurement " to reconcile procurement procedures. The staffs involving in thlis office ate technical professionals from Shanghai Port Authority. Those people are fully aware of bidding procedures of the Bank with a good command of English language and rich managerial experience to ensure smooth implementation of the project under instrLuction of experts from the Bank. They have also successfully implanted the practice of international bidding into domestic process. IX. Design of botlh Phase I of Waigaoqiao and Luojing Coal Terminal is mainly undertaken by local institutions, including No. 3 Navigational Design Institute, MOC and the like. Construction units are determined through competitive bidding mostly from local market. By and large, the design is successful and both design and construction units have made their contributions to satisfactory implementation of the project. X. Bidding document for procurement of equipment is jointly prepared by both Shanghai Port Autlhority and client. Some reliable advanced technologies that are locally acceptable have been intentionally introduced into relevant technical specifications. Reality proves that the bidding tasks are successful, and the process of equipment procurement is fully coherent with the contents of evaluation report by the Bank, while the implementation is of contractual consistent and associated equipment timely delivered. XI. June 30, 1999 is loan expiration as set forth in Bank's evaluation report, thanks to emphases laid on this task by our leaders and to the efforts by specially set up dedicating "Bidding Office", all items in the project have witnessed smoothly implemented, culminating in successful closure of account before June 30, 1999. XII. Introduction of international bidding has played a contributory role to reducing unit price of equipment, resulting in some saving at bases of 150 million U.S dollars that was originally budgeted. With approval of the Bank, 25.74 million U.S dollars have been returned accordingly. 124.26 million U.S dollars are due to spend, the actual figure however is subject to the Bank upon closure of account. Portion II XIII. The contents of ICR prepared by the Bank is comprelhensive with integral comparat.ve descriptions over main sections of the project. The analyses provided have also reflected :he reality that are factually correct in general. XIV. We herewith reconfirm that the data in ICR are basically correct and factually acceptable. Portion III XV. The performance by the Bank ever since from evaluation stage to final reimbursement suggests active and effective, and Shanghai Port Authority extends sincere thaniks again to all Bank's officials and experts for their valuable efforts and contributionis they made to  32 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLIETION REPORT development of the Port. Their high responsible attitude, scientific management and dedicatory working spirit have left a deep impression in our minds. XVI. During the whole period of implementation of the project, we are always keeping a close cooperation with relevant departments of the Bank and respect each other, the experts from the Bank have also offered their various assistance. Shanghai Port Authority has overcome all kinds of difficulties occurring to the implementation of the project and successfully fulfilled the project. XVI1. Every inspection team from the Bank has made much of an effort to smoothly implement the Project by their seriously collecting first-hanid field findinigs. By strengthening mutual understanding and credit, the development process has been greatly expedited. The instructions, understanding and prompt response by Bank's officials to the demand we raised have stimulated the smooth implementation of the Project.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 33 IMPLEMENTATION COMPLETION REPORT ANNEX 1: FINANCIAL ANALYSIS TABLE 1.1: SHANGHAI PORT AUTHORITY INCOME STATEMENT (Y million) 1991 1992 1993 1994 1995 1996 1997 1998 Traffic ('000 ton) Whole port 146,788 162,968 175,956 165,809 165,672 164,018 163,970 .63,878 Port authority 97,328 104,765 112,641 98,924 95,090 94,097 91,355 90,535 Of which: Container(in '000ton) 6,105 7,156 8,474 10,581 13,889 17,851 23,035 27,657 Container (in '000 teu). 577 730 934 1,199 1,527 1,971 2,527 3,066 Revenue Loading/unloading 498.01 675.01 1,241.54 1,163.90 1,350.40 1,039.75 1,122.27 1,159.00 Storage 164.01 140.23 257.92 241.79 280.53 121.60 123.84 101.00 Other 472270 454.08 835.18 782.95 908.41 1,236.78 992.29 909.00 Marketing 74.39 219.35 403.45 378.23 438.84 363.73 463.57 464.00 Sulbtotal 1,209.11 1,488.67 2,738.09 2,566.87 2,978.18 2,761.86 2,701.97 2,633.00 Operating Taxes Loading/unloading 15.99 21.67 36.54 35.65 39.21 34.11 36.74 38.00 Storage 8.78 7.50 12.65 12.34 13.57 6.67 6.80 6.00 Other 12.76 15.10 25.46 24.84 27.32 38.64 35.55 33.00 Marketing 1.45 2.35 3.96 3.87 4.26 4.47 7.59 8.00 Total Operating tax 38.97 46.62 78.61 76.70 84.36 83.89 86.68 85.00 Net Sales Loading/unloading 482.03 653.34 1,205.00 1,128.25 1,311.19 1,005.64 1,085.53 1,121.00 Storage 155.24 132.73 245.27 229.45 266.96 114.93 117.04 95.00 Other 459.94 438.98 809.72 758.11 881.09 1,198.14 956.74 876.00 Marketing 72.94 217.00 399.49 374.36 434.58 359.26 455.98 456.00 Total Net Sales 1,170.14 1,442.05 2,659.48 2,490.17 2,893.82 2,677.97 2,615.29 2,548.00 Operating Costs Loading/unloading 347.68 483.92 842.21 816.20 975.50 658.()2 686.58 696.00 Storage 43.38 56.03 97.51 94.50 112.94 73.67 63.04 68.00 Other 317.86 283.64 493.64 478.39 571.76 813.11 623.69 596.00 Marketing 72.49 214.32 373.01 361.49 432.05 324.29 424.92 430.00 Total Operating Costs 781.40 1,037.91 1,806.37 1,750.58 2,092.25 1,869.09 1,798.23 1,790.00 Operating Profit Loading/Linloading 134.35 169.42 362.79 312.05 335.69 347.62 398.95 425.00 Storage 111.85 76.70 147.76 134.95 154.02 41.26 54.00 27.00 Other 142.09 155.34 316.08 279.72 309.33 385.03 333.05 280.00 Marketing 0.45 2.68 26.48 12.87 2.53 34.97 31.06 26.00 Total Operating Profit 388.74 404.14 853.11 739.59 801.57 808.88 817.06 758.00 Surcharges 0.73 39.75 449.77 517.07 781.98 835.83 900.15 1,072.00 Nonoperating Income 0.00 0.00 4.66 13.14 43.12 28.08 30.96 20.00 Nonoperating Expenses 78.80 93.65 90.42 49.35 57.73 82.65 73.85 58.00 Other Income (expenditure) 5.28 7.67 15.08 120.72 245.44 262.78 326.36 403.00 Profit Before Taxes (A) 314.49 278.41 332.66 307.03 250.42 181.26 200.38 51.00 IncomeTax 51.55 51.55 35.00 35.00 35.00 59.82 66.13 17.00 Adjustment Taxes -- -- -- -- -- -- -- -- Other Payments to State 21.00 21.00 -- -- -- -- -- -- Tax credit to State -- -- 76.00 130.00 130.00 -- -- -- Net Profit after Taxes 241.94 205.86 221.66 142.03 85.42 121.44 134.25 34.00 Ratios AverageNetFixedAssets (B) 2,097.31 2,415.36 2,348.58 2,440.70 3,061.81 3,866.39 4,741.86 5,380.09 Return on ANFA (A/B) (3 ) 15.0 12.0 14.0 13.0 8.0 5.0 4.0 1.0 Operating Ratio (%) 66.8 72.0 67.9 70.3 72.3 69.8 68.8 70.3 Profit Margin on Sales 26.0 18.7 12.1 12,0 8.4 6.6 7.4 1.9  34 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 1.2: SHANGHAI PORT AUTHORITY BALANCE SHEET (Y million) 1991 1992 1993 1994 1995 1996 1997 1998 Assets Fixed Assets Atcost 2,945.67 3,182.77 3,028.20 3,466.96 4,620.38 5.558.12 6,841.66 7.370.00 Less: depreciation 538.10 759.62 754.19 859.58 1.104.15 1,341.58 1 57449 1,877.00 Net fixed assets 2,407.57 2,423.15 2,274.01 2,607.38 3,516.23 4,216.54 5,267.17 5,493.00 Otherfixed assets!_I 1,047.35 1,316.72 1,724.61 1,573.36 1,217.47 1,604.00 Current Assets Inventory 117.05 164.03 318.92 546,85 646.46 609.86 557.70 713.00 Receivable 261.79 509.01 626.78 808,59 948.21 997.68 1,114.69 1,120.00 Cas]1 264.31 381.22 692.04 776.33 636.11 741.69 834.79 678.00 Subtotal 643.15 1,054.26 1,637.74 2,131.77 2,230.78 2,349.23 2.507.18 2,511.00 Special fund Assets 319.54 764.06 -- -- -- -- -- Long-Term Investments -- -- 1,254.65 1,371.84 1,478.80 1,659.45 1,761.10 1,910.00 Other Assets /_2 -- -- -- 1.03 7.64 16.55 11.30 5.00 Total Assets 3,370.26 4,241.47 6,213.75 7,428.74 8,958.06 9,815.13 10,764.22 11,523.00 Liabilities & Equity Statefunds-Equity 2,011.24 1,934.39 3,935.26 4,046.29 4,671.75 4,989.11 5,474.88 5,577.00 Intemnal funds for Port development 124.53 126.29 -- -- -- -- -- -- L/T loans: Foreign -IBRD 25.39 129.15 416.33 437.00 620.40 1,232.00 1,238.12 1,271.00 -Others -- 1.55 -- -- -- -- -- 95.00 Local 550.80 868.34 519.84 904.17 1,283.63 1,003.37 1,123.15 1,077.00 Subtotal 576.19 999.04 936.17 1,341.17 1,904.03 2,235.37 2.36127 2,443.00 Current liabs. 179.64 579.35 1,342.32 2,041.28 2,382.28 2,590.65 2,928.07 3,503.00 Special funds 478.66 602.40 -- -- -- -- -- -- Total Lia. & Equity 3,370.26 4,241.47 6,213.75 7,428.74 8,958.06 9,815.13 10,764.22 11,523.00 Debt: Capital 21.2 32.7 19.2 24.9 29.0 30.9 30.1 30.5 Debt/EquityRatio 22/78 37/63 36/64 45/55 47/53 49/51 49/51 51/49 CurrentRatio 3.6 1.8 1.2 1.0 0.9 0.9 0.9 0.7 /_1: Including construction-in-progress and disposal assets. /_2: Including intangible and deferred assets.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 35 IMPLEMENTATION COMPLETION REPORT TABLE 1.3: SHANGHAI PORT AUTHORITY SOURCES AND APPLICATIONS OF FUNDS (Y million) 1991 1992 1993 1994 1995 1996 1997 1998 Sources Netprofit 241.94 205.86 221.66 142.03 85.42 121.44 134.25 34.00 Depreciation 98.30 221.52 152.00 165.00 244.57 237.00 299.64 362.00 State contribution -- -- 76.00 130.00 130.00 116.60 275.76 69.00 Borrowing: Foreign - IBRD 208.17 15.00 0.00 358.00 202.00 366.00 181.01 38.00 - Others -- -- 70.00 78.00 41.00 -- -- 8.00 Local -- -- 331.00 272.00 35.00 336.00 643.14 377.00 Others!_I -- -- -- -- -- -- Total Sources 548.41 442.38 850.66 1,145.03 737.99 1,177.04 1,533.80 888.00 Applications Capital expenditure 355.00 383.76 900.15 868.96 931.98 1.242.46 1,505.73 1,382.32 Net Payments to State -- -- -- -- -- -- -- -- Special fund expenditure 41.73 31.55 -- -- -- -- -- -- Loan repayment: Foreign -IBRD 0.84 15.67 27.00 39.0(0 19.00 16.50 174.68 59.00 -Others -- -- 7.00 29.00 23.00 8.00 32.86 0.00 Local -- -- 96.00 413.0(1 6.00 -- -- 17.00 Chan.gew/capital 38.97 (105.51) (490.31) (289.22) (101.77) (195.50) (272.57) (414.32) Total Applications 436.54 325.47 539.84 1,060.74 878.21 1,071.46 1,440.70 1,044.00 Net Funds Flow 111.87 116.91 310.82 84.29 (140.22) 105.58 93.10 (156.00) Opening Balance 152.44 264.31 381.22 692.04 776.33 636.11 741.69 834.00 Closing Balance 264.31 381.22 692.04 776.33 636.11 741.69 834.79 678.00 DIS Cover 405.0 27.3 2.9 0.6 6.9 14.6 2.1 5.2 /_1: Harbor due and other incomes.  36 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT ANNEX 2: ECONOMIC ANALYSIS A. TRAFFIC 1. In 1998, Shanghai port authority (SPA) handled 90.54 million tons of cargo, about 25 percent less than the SAR forecast of 121.1 million toins. The total cargo handled by the project berths was also 22.2 percent less than the SAR's projectioni (83.13 million tons actualvs. 106.83 million tonls projection). Except for container traffic, all cargo traffic for the project berths, including break bulk, coal and construction materials, was less than projected by the SAR. Coal in particular decreased 9.6 percent annually between 1991 and 1998. The rapid increase in container traffic (an average of 28.1 percent annually between 1991 and 1998) partially offset the decrease in traffic from other project berths. In addition, the cargo hanidled by the project berths in 1991 constituted 79.4 percent of total port traffic. In 1998, this ratio had increased to 91.8 percent, higher than the SAR's projection of 88.2 percent. It is clear that construction of the project berths met port traffic demand. 2. The detailed SPA traffic, including traffic on the project berths, shown in Table 2.1 is summarized below. SPA Traffic Summary (million ton) 1991 1993 1995 1996 1997 1998 2000 1991-98 (Actual) Forecast Avg. p.a. ICR: Total port traffic (1) 98.37 112.64 95.09 94.10 91.36 90.54 100.00 -1.2% Of which: Break bulk 22.07 42.75 28.40 23.86 26.81 26.96 31.79 2.9% Coal 42.46 44.33 32.91 34.91 24.74 20.91 23.30 -9.6% Construction materials 8.66 11.17 8.44 6.29 8.85 7.60 12.00 -1.8% Container 4.89 8.47 13.89 17.85 23.04 27.66 31.16 28.1% Subtotal (2) 78.08 106.72 83.64 82.91 83.44 83.13 98.25 -0.9% % Shareoftotal port(2)/(1) 79.4% 94.7% 88.0% 88.1% 91.3% 91.8% 98.3% -- SAR ( 93-98 projection): Total port traffic (3) 98.37 105.43 113.00 115.59 118.28 121.07 127.00 3.0% Of which: Breakbulk 22.07 25.45 29.35 30.15 30.98 31.83 33.59 5.4% Coal 42.46 46.08 50.00 51.04 52.09 53.17 55.40 3.3% Construction materials 8.66 10.38 12.43 13.06 13.72 14.41 15.90 7.5% Container 4.89 5.54 6.27 6.63 7.01 7.42 8.31 6.1% Subtotal (4) 78.08 87.45 98.05 100.88 103.80 106.83 113.20 4.6% % Share oftotal port (4)/(3) 79.4% 82.9% 86.8% 87.3% 87.8% 88.2% 89.1% --  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 37 IMPLEMENTATION COMPLETION REPORT 3. Total port traffic has decreased since 1994. However, based on first quarter performance, total port traffic is expected to increase to 95.0 million tolls in 1999, especially given current Government economic policy (to boost annual economic growth by 8 percent). B. SHIP TIME ANALYSIS 4. Break Bulk Carriers: Comparing 1992 figures (without the project) with 1998 figures (with the project), general cargo carriers spent an average of 3.49 days and 1.67 days, respectively, in the port, of which waiting (nonproductive) time decreased from 1.80 days to 0.60 day. During the same period, the average working time per ship (productive time at berth) also decreased from 1.43 days to 0.86 day because of improved hiandling efficiency (Table 2.2). 5. Container Carriers: Despite the increase in container traffic (in tonnage) by an average of 28.1 percent per year from 1992 to 1998, the average total per-slhip time spent in the port decreased from 1.35 days to 0.56 day. The average time to unload (productive time) decreased from 0.37 day to 0.22 day. The new equipment improved handling efficiency and maximized equipment availability. The average per-ship nonproductive time attributable to the pcrt decreased from 0.35 day to 0.01 day per ship, while the total number of container vessels calling at the port increased five-fold. Thus, without the project, additional traffic would have lengthened ship-waiting time. 6. Coal Ships: Coal traffic used to be the biggest single item lhandled by SPA. In 1991, it constituted 43.2 percent of total freight traffic of the port. In 1998, coal was still the second- largest cargo category-after container cargo-constituting 23.1 percent of total freight traffic of the port. Any slight improvement in coal handling will mean large savings for cargo and ship owners. Comparing 1992 with 1998, total nonproductive time at berth has improved from 0.15 day per ship to 0.14 day. 7. To attract coal traffic, SPA provided an extra service to users, allowing tlhem to stockpile coal. The separate stockpile operations require more time for handling. As a result, coal productive time at berth increased from an average 0.40 day per ship in 1992 to 0.78 day in 1998. 8. Construction materials ships: Ship time in port for construction materials ships improved since 1992 because of investments in facilities to handle the traffic. The per-ship port time continually improved during project implementation. The average stay in port is 0.37 days, an improvement of 30 percent over the 0.54 day in 1992. C. BERTH OPERATIONS 9. Operating data for general cargo, container, coal and construction materials at the port differ somewhat from the SAR estimates. Detailed operating data used for the econonmic revaluation of each project berth are shown in Table 2.3, and are highlighted as follows:  38 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT MAJOR OPERATING DATA COMPARISON SAR iCR Dec. 1992 Dec. 1999 Dec. 1999 Percentage Prices Prices Prices Changed 1. Berth number - without the project: Break bulk 37 37 -- Container 7 7 -- Coal 8 8 -- Construction materials 2 2 -- 2. Berth number - the new project: Break bulk 2 2 -- Container 1 I -- Coal 2 2 -- Construction materials I 1 3. Maximum annual throughput per new berth (million ton): Break bulk 0.61 0.61 -- Container ('000 teu) 48.90 54.00 10% Coal 6.85 8.03 17% Construction materials 1.20 1.08 -10% 4. Average ship size- the new berths ('000 dwt): Break bulk 12.0 12.0 -- Container ('000 teu) 1.5 2.0 33% Coal 30.0 35.0 17% Construction materials 10.0 10.0 -- 5. Average shipment size- the new berths ('000 dwt): Break bulk 7.5 7.5 -- Container ('000 teu) 1.0 1.5 50% Coal 24.0 28.0 17% Construction materials 10.0 10.0 -- 6. Cargo value ('000 Y/ton): Break bulk 2.00 3.53 3.50 -1% Container ('000 Y/teu) 20.00 35.29 40.00 13% Coal 0.16 0.28 0.25 -11% Construction materials 0.03 0.05 0.05 -- 7. Average daily ship port costs- the new berths (US$/day): Break bulk 4.41 5.11 7.01 37% Container 9.45 10.95 16.10 47% Coal 6.57 7.61 9.09 19% Construction materials 3.89 4.51 5.22 16% 8. Cargo handling (Y/ton): Break bulk 5.76 10.16 6.50 -36% Container('Y/teu) 256.5 452.59 370.00 -18% Coal 1.62 2.86 2.85 -- Construction maferials 1.04 1.84 2.55 39% D. ECONOMIC COSTS AND BENEFITS Economic Costs 10. All costs associated with the facilities planned unlder the project were considered in the economic reevaluation. All inputs and outputs were evaluated in constanit December 1999  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 35 IMPLEMENTATION COMPLETION REPORT economic prices (Table 2.4). Financial costs were converted to economic costs by shadow pricing each berth's input categories. Conversion factors for each input category were based on estimate:3 determined in completed Bank studies. 11. The overall conversion factor is 1.03, including general cargo for break bulks, coal berths and construction-materials berths at 1 .03 and container berths at 1.04. The factors derived for thi various cost items were applied to annual project expenditures to obtain the stream of project economic costs (Table 2.5). 12. In the [CR, shadow-pricing project costs elevated economic costs 16.4 percent over financial costs. Total project economic costs are 18.3 percent less than the SAR estimate in constant December 1999 prices. The comparisons are summarized below: Project Economic Cost Comparison (million Yuan) Break Construction Bulk Bulk Container Materials Coal Fertilizer Total SAR (economic, constant): 1992 prices 521.61 414.08 246.64 970.79 23.00 2,176.12 1999 prices (A) 825.13 655.03 390.16 1,535.68 36.38 3,442.38 ICR: Financial (current) 422.88 387.28 357.00 1,248.14 -- 2,415.30 Economic (1999 constant prices) (B) 530.00 528.17 478.44 1,275.96 = 2,812.57 ICR/ SAR in % (B)/(A) 64.2 80.6 122.6 83.1 -- 81.7 Economic Benefits 13. To estimate the port traffic, SPA carried out a detailed market survey in 1998 to all twelve major cargoes of the port. It is expected that the total port traffic would be I 00 m illion ton in 2000 or increase 5.1 % pa from 1998, of which, coal traffic may increase 5.6 % pa. Based on the first four months actual performance in 1999, the total port traffic has increased by 14.9 % compared with the same period of 1998 and coal also has increased by about 5 %. The long term traflic projection (2000-2005) estimates that the annual growth of total port traffic would be 4.1 % pa. and coal traffic would be 4.0 % pa. In addition, the fast increase in construction materials (sand, stone and bricks) between 1998 and 2000 (25.6 % pa.) is resulting from the recent large infrastructure projects taking place in Shanghai metropolitan area which generate transportationi demand. For the long term forecast (2000-2005), the growth rate of constructioni materials is expected to be 4.0% pa. 14. The economic analysis focused on the benefits derived from relieving port congestion. Details of the traffic forecast are shown in Table 2.1. The project will yield quantifiable benefits in the form of savings in cargo handling costs, ship time (both waiting time and operating time), and cargo time (Table 2.6). In the case of coal handling and other equipment for rehabilitation berths, large benefits will be obtained from reduced pollutioni but, unfortunately, these are not yet quantifiable in monetary terms. Based on 1998 actual performance of the port, the total project  40 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT benefits is expected to be 1.05 billion Yuan and the distribution of the project benefits would be 47 percent for ship time savings, 45 percent for cargo handling cost savings and 8 percent for cargo time savings. 15. Savings in Ship Time. These include reductions in ship timie waitilg for berths and working at berths due to improved cargo handling. Estimates of savings in ship waiting time due to the project are shown in Table 2.8. Ship costs used for the economic evaluation were at the low end of the ship cost model developed by the Bank. The annualized ship resale value, plus operating costs, was used to calculate project benefits. The annual resale value of ships was assumed to reflect the present state of the shipping industry and gives a slightly lower returnl than the annualized replacement value. 16. Savings in Cargo Handling Cost. Savings are relatively small and are expected to accrue from the direct cost of cargo handling in the new facilities as compared with the present ones. Without the project, the only way to handle traffic in excess of berth capacity would be through "lightening," but it is estimated these costs would be three to four thimes greater than normal handling costs. Detailed estimates of handling cost savings are showni in Table 2.7. Lightening was assumed for cargo tonnage exceeding 95 percent berth occupancy, at a cost three times that of normal handling. Substantial savings in handling costs are expected after existing berths are renovated and new berths are built. Savings in handling costs were converted to economic benefits by shadow-pricing the main cost components of normal handling and lightening. Conversion factors of 1.05 for berth handling and 1.1 for lighteninlg are used; these factors were estimated in a previous Bank study. 17. Savings in Cargo Time. Savings in ship cargo time also apply to the interest saved on the value of the cargo. For domestic cargo, the marginal source of working capital would be loans from the National Development Bank of China at an overall average I 0 percent interest rate. For foreign cargo, the higher foreign exchange working capital needed would require more foreign borrowing, and it is assumed that this would be at China's marginal cost of capital (approximately 12 percent). 18. Total project benefits for the items presented above are presented by year in Table 2.8. The major project benefit would be in ship time savings. These would accrue first to ship owners and could be passed on to cargo owners. Only coal ships and construction material ships are completely owned by the Chinese. As for other cargo, the vast majority of ships calling at the port are either Chinese-owned (COSCO) or Chinese-operated; it is estimated that project benefits for 80 percent of break bulk cargo and 65 percent of container cargo would accrue to China directly. E. OVERALL ECONOMIC REEVALUATION AND SENSITIVITY ANALYSIS 18. Table 2.9 sets out the reevaluated economic internal rate of return (REIRR), net present value (NPV) and sensitivity calculations for the entire project. The overall REIRR is 29.2 percent. Compared with SAR estimates (36.7 percent), the sensitivity of the project to variations in costs and benefits is summarized as follows:  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 41 IMPLEMENTATION COMPLETION REPORT REIRR Summary (in '%o) Break Construction Bulk Bulk Container Materials Coal Fertilizer Total Best estimate of economic rate of return: ICR 21.0 51.9 16.8 -3.0 -- 29.2 SAR 36.8 49.9 27.6 17.5 52.5 36.7 15% decrease in benefits ICR 18.2 47.8 10.3 -4.3 -- 25.7 SAR 32.7 45.3 18.3 13.9 47.7 32.1  42 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 2.1: PORT TRAFFIC ('000 ton) Actual | Forecast 1995 1996 1997 1998 2000 2005 2010 2020 Est. Dry Bulks: Coal (In) 23,085 24,042 17,762 15,520 17,700 21,540 24,970 30,440 (Out) 9,820 10,869 6,977 5,391 5,600 6.810 7,890 9,620 Others 19,856 16,880 16,364 14,418 13,750 16,040 17,830 21,740 Subtotal 52,761 51,791 41,103 35,329 37,050 44,390 50,690 61,800 Est. Liquid Bulks 38 599 406 593 0 0 0 0 Est. Container (loaded) 13,889 17,851 23,036 27,657 31,160 39,739 48,308 64,876 Est. General Cargo: Construction materials: 8,437 6,294 8,853 7,599 12,000 14,600 16,930 20,640 Large berth operation 1,519 1,133 1,594 1,368 2,160 2,628 3,047 3,715 Small berth operation 6,581 4,909 6,905 5,927 9,360 11,388 13,205 16,099 Mid-stream operation 337 252 354 304 480 584 678 826 Break bulks: 19,964 17,562 17,957 19,357 19.790 23,621 26,882 33,104 Largeberthoperation 13,975 12,293 12,570 13,550 13,853 16,535 18,817 23,173 Small berth operation 3,194 2,810 2,873 3,097 3,166 3,779 4,301 5,297 Mid-stream operation 2,795 2,459 2,514 2,710 2,771 3,307 3,764 4,634 Subtotal 28,401 23,856 26,810 26,956 31,790 38,221 43,812 53,744 Total Traffic handled by SPA 95,089 94,097 91,355 90,535 100,000 122.350 142,810 180,420 Total container traffic ('000 teu) 1,527 1,971 2,527 3,066 3,740 4,768 5,797 7,785 Sources: Shanghai Port Authority and Bank staff.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 43 IMPLEMENTATION COMPLETION REPORT TABLE 2.2: SHIP TIME ANALYSIS (Actual Ship Day Per Ship) Coal Ships General Cargo Slhips 1992 1994 1995 1997 1998 1992 1994 1995 1997 1998 1. Productive time at berth 0.40 0.39 0.44 0.62 0.78 1.43 1.14 1.07 0.92 0.86 2. Nonproductive time at berth a. Due to port 0.04 0.02 0.01 0.09 0.10 0.16 0.16 0.14 0.10 0.07 b. Due to ship 0.10 0.10 0.03 0.05 0.02 0.26 0.26 0.28 0.29 0.21 c. Due to cargo owner - - - 0.01 0.01 1.14 0.66 0.29 0.23 0.15 d. Others 0.01 0.01 0.01 0.01 0.01 0.24 0.28 0.24 0.16 0.17 Subtotal 0.15 0.13 0.05 0.16 0.14 1.80 1.36 0.95 0.78 0.60 3. Weather stoppage 0.06 0.09 0.12 0.16 0.16 0.26 0.28 0.18 0.19 0.21 Total 0.61 0.61 0.61 0.94 1.08 3.49 2.78 2.20 1.89 1.67 Total number of ship 5,033 3,758 2,581 1,945 1,299 1.478 1,477 1,673 1,627 1,290 Container Ships Construction Materials Ships 1992 1994 1995 1997 1998 1992 1994 1995 1997 1998 1. Productive time at berth 0.37 0.28 0.25 0.22 0.22 0.28 0.26 0.24 0.21 0.26 2. Nonproductive time at berth a. Due to port 0.35 0.07 0.03 0.01 0.01 0.05 (1.03 0.03 0.01 0.01 b. Due to ship 0.11 0.10 0.11 0.06 0.04 0.16 0.08 0.07 0.07 0.07 c. Duetocargoowner 0.39 0.08 0.27 0.10 0.11 0.01 0.01 0.01 0.01 - d. Others 0.09 0.07 0.03 0.12 0.12 0.03 0.02 0.02 0.02 0.03 Subtotal 0.94 0.32 0.44 0.29 0.28 0.25 0.14 0.13 0.11 0.11 3. Weather stoppage 0.04 0.02 0.01 0.02 0.06 0.01 - - - - Total 1.35 0.62 0.70 0.53 0.56 0.54 0.40 0.37 0.32 0.37 Total number of ship 2,646 5,398 7,147 11,108 13,343 5,494 4,838 3,634 2,094 1,810 Source: SPA  44 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 2.3: OPERATIONAL PARAMETERS ASSUMED FOR ECONOMIC EVALUATION Break bulk berths Existing berths New Without project Renovatioln of berth Mixed Mixed Break Mixed Break Use Use Bulk UJse Bulk Berths Berths (number) 26 11 9 5 2/ 6 Cranes per berth (number) 4 3 4 3 3 Average crane productivity per hour (tons) 40 25 42 30 42 Average working hours per day (hours) I 15 17 17 17 Throughput capacity per berth (tons/day) 2,400 1,125 2,856 L530 2,142 Berth operating days per year (days) /1 320 320 320 320 300 Maximum annual capacity per berth ('000 tons) 730 342 868 465 610 Ship arrivals (scheduled/unscheduled) Unscheduled Unschleduled Unscheduled Average ship size (DWT) 12,000 12.000 12,000 12,000 12,000 Average shipment size (ton) 7,500 7,500 7.500 7,500 7,500 Cargo value (Yuan/toni) 3,500 3,500 3,500 3,500 3,500 Average daily ship costin port(Yuan/day) 58,183 58,183 58,183 58,183 58,183 Unloading/loading cost (Yuan/ton) 2 7.00 7.00 6.50 6.50 6.50 Coal berths Construction Existing berths New Materials berths Without With The Coal Existing New The Project Project Berth Berthi Berths Berths (nutmber) 8 8 2 2 1 /6 Cranes per berth (number) 3 3 1.5 2 2 Average crane productivity per hour (tons) 200 30(0 1,000 60 90 Average working hours per day (hours) 21 21 21 21 21 Throughput capacity per berth (tons/day) 12,600 18.900 31,500 2.520 3,780 Berth operating days per year (days) /1 320 320 300 320 300 Maximum annual capacity per berth ('000 tons) 3,830 5,746 8,033 766 1,077 Ship arrivals (scheduled/unischeduled) Unsclieduled I oscihed uled tinsclieduled Average ship size (DWT) 20,000 20,000 35,000 10,0()0 10,000 Average shipmeit size (toni) 18,000 18,000 28,000 10,000 10,000 Cargo value (Yuan/toni) 250 250 250 50 50 Average daily ship cost in port (Yuan/day) 56,606 56,606 75.447 43,326 43,326 Unloading/loading cost (Yuan/ton) /_2 3.00 2.85 2.85 3.95 2.55 Existing Containier Berths New Container Withouit TIle project With The Project Berth Berths (number) 7 7 1 /6 Cranes per berth (number) 0.86 /_4 1.43 /_5 1.00 Average crane productivity peT hour (teus) 20 20 20 Average workinrg hours per day (hours) 16.3 16.3 18.0 Throughput capacity per berth (teus/day) 280 466 360 Berth operating days per year (days) /1 320 320 300 Maximum annual capacity per berth ('000 teus) 44.9 74.6 54.0 Ship arrivals (scheduled/unscheduled) Scheduled Scheduled Scheduled Average ship size (dwt) / 3 1,00(1 1,000 2,000 Average shipment size (teu) 700 700 1,500 Cargo value (Yuan/tue) 40,000 40.000 40,000 Average daily ship cost in port (Yuan/day) 77,190 77,190 133,630 Unloading/loading cost (Yuan/teu) /_2 400.00 370.00 370.00 Notes: (i) theoretical daily berth capacity = cranes per berth x average crane productivity per hour x average working hours per day. (ii) theoretical annual berth capacity = theoretical daily berth capacity x herthi operating days per year. (iii) maximum annual capacity per berth = theoretical annual berth capacity x maxilmlulm berth utilization. /_1. For lighterinig operation, throughput capacity is taken as 50% of normal berth thiouglpLut capacity. / 2. Figures in the table are the costs for normal berth handling. If cargo traffic exceeds 95% berth occupancy rate, additional cargo will be Handled by lightering at roughly three times the costs for normal berth handliln. i_3. Equivalent to 14,300 dwt (1,000 teu) and 21,500 dwt (1,500 teu) per ship. /_4. Seven berths share the total of six cranes, one teu n 10.0 ton. /_5. Seven berths share the total of ten cranes. /_6: Starting July 1998, two break bulk berths and one constr-Lction material berth have been converted into two containier berths.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 4.5 IMPLEMENTATION COMPLETION REPORT TABLE 2.4A: ECONOMIC COST SUMMARY (Yuan million) 1991 1992 1993 1994 1995 1996 1997 1998 1999 Total Financial Cost (current): Container 39.35 69.88 93.50 120.60 51.69 3.16 3.16 2.66 3.28 387.28 BreakBulks 33.35 60.60 81.66 112.77 125.52 3.16 3.16 2.66 - 422.88 Construction materials 38.50 63.25 82.40 78.01 85.84 3.17 3.17 2.66 - 357.00 Coal 5.77 3.53 20.03 130.07 305.81 603.17 177.10 2.66 - 1,248.14 Subtotal 116.97 197.26 277.59 441.45 568.86 612.66 186.59 10.64 3.28 2,415.30 Economic Cost ( Dec. 1999 constance prices): Container 73.15 122.31 141.20 133.46 45.94 2.94 3.09 2.67 3.41 528.117 Break Bulks 61.41 105.05 122.10 122.33 110.50 2.91 3.06 2.64 - 530.00 Construction materials 70.88 109.65 123.43 90.29 75.56 2.92 3.07 2.64 - 478.44 Coal 10.62 6.12 30.51 162.80 306.32 576.92 180.03 2.64 - 1,275.96 Subtotal 216.06 343.13 417.24 508.88 538.32 585.69 189.25 10.59 3.41 2,812.57 TABLE 2.4B: PRICE INDEX FOR CALCULATION OF ECONOMIC COST (in %) 1991 1992 1993 1994 1995 1996 1997 1998 1999 Foreign prices 2.10 4.30 -0.30 3.60 8.20 -4.40 -5.10 -2.50 1.30 Domestic prices 5.70 6.20 13.80 21.70 14.80 6.50 1.27 0.00 4.00  TABLE 2.5: SHADOW PRICE CALCULATION (December 1999 prices, Yuan million) Break Bulks Construction Materials Container Coal Conv------ -------- - ersion Financial Econo Financial Econo Financial Econo -------------Financial--------- Econo Total factor Local Foreign Total -mic Local Foreign Total -mic Local Foreign Total -mic Local Foreign Total -mic Project Land 1.00 70.22 0.00 70.22 70.22 68.82 0.00 68.82 68.82 84.26 0.00 84.26 84.26 78.17 0.00 78.17 78.17 Labor: Unskilled 1.00 2.43 0.00 2.43 2.43 3.27 0.00 3.27 3.27 3.89 0.00 3.89 3.89 9.65 0.00 9.65 9.65 Semi skilled 1.50 5.29 0.00 5.29 7.94 7.01 0.00 7.01 10.52 8.00 0.00 8.00 12.00 19.30 0.00 19.30 28.95 Supervisor 3.00 1.00 0.00 1.00 3.00 1.12 0.00 1.12 3.36 1.33 0.00 1.33 3.99 5.63 5.98 11.61 22.87 Materials: Steel 1.00 19.46 0.00 19.46 19.46 21.27 0.00 21.27 21.27 25.06 0.00 25.06 25.06 23.17 76.14 99.31 99.31 Timber 1.00 3.12 0.00 3.12 3.12 3.27 0.00 3.27 3.27 3.84 0.00 3.84 3.84 2.54 19.04 21.58 21.58 Cement 1.00 11.28 0.00 11.28 11.28 11.92 0.00 11.92 11.92 13.55 0.00 13.55 13.55 19.93 0.00 19.93 19.93 Fuel: Diesel 1.00 3.10 0.00 3.10 3.10 3.27 0.00 3.27 3.27 3.61 0.00 3.61 3.61 10.99 0.00 10.99 10.99 Gasoline 1.00 0.38 0.00 0.38 0.38 0.40 0.00 0.40 0.40 0.46 0.00 0.46 0.46 1.41 0.00 1.41 1.41 Heavy oil 1.00 0.20 0.00 0.20 0.20 0.21 0.00 0.21 0.21 0.23 0.00 0.23 0.23 0.70 0.00 0.70 0.70 x Others 1.00 0.22 0.00 0.22 0.22 0.23 0.00 0.23 0.23 0.26 0.00 0.26 0.26 0.70 0.00 0.70 0.70 Water 0.80 5.37 0.00 5.37 4.30 5.84 0.00 5.84 4.67 6.42 0.00 6.42 5.14 17.33 0.00 17.33 13.86 Electricity 2.00 7.98 0.00 7.98 15.96 7.20 0.00 7.20 14.40 8.70 0.00 8.70 17.40 17.82 0.00 17.82 35.64 MNfechanical 1.00 11.72 201.71 213.43 213.43 13.79 123.28 137.07 137.07 15.09 128.24 143.33 143.33 46.48 388.32 434.80 434.80 C equipmentt Others 1.00 79.40 0.00 79.40 79.40 86,10 0.00 86.10 86.10 81.05 3.29 84.34 84.34 450.45 54.39 504.84 504.84 Total 221.2 201.71 422.88 434.44 233.72 123.28 357.00 368.78 255.75 131.53 387.28 401.36 704.27 543.87 1,248.14 1,283.40 -==== = ==== ===== ===== ===== .. === ===== ===== ==== ===== ===== ===== ==== ===== ======_=====_ Overall conversion factor 1.03 1.03 1.04 1.03 1.03 . /-1: Shadow exchange rate 1.0.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 47 IMPLEMENTATION COMPLETION REPORT TABLE 2.6: SAMPLE OF CARGO HANDLING WITHOUT AND WITH PROPOSED BERTHS Container berths 1989 1990 1991 1995 1996 1997 1998 1999 2000 2005 A. TRAFFIC DEMAND ('000 TEUs) /-1 354.0 456.0 577.0 1,527.0 1,971.0 2,527.0 3,066.0 3,403.0 3,740.0 4,768.0 B. WITHOUT PROJECT Existing Container Berths 1. Berths (number) 7 7 7 7 7 7 7 7 7 7 2. Traffic ('000 TEUs) 354.0 456.0 577.0 1,527.0 1,971.0 2,527.0 3,066.0 3,403.0 3,740.0 4,768.0 3. Annual ship berth days required 1,262 1,626 2,058 5,446 7,029 9,012 10,934 12,136 13,338 17,004 4. Annual ship berth days available 2,240 2,240 2,240 2,240 2,240 2.240 2,240 2,240 2,240 2,240 5. Berth occupancy rate (%) 56 73 92 95 95 95 95 95 95 95 6. Waitingtime queuing factors 0.02 0.06 0.56 1.04 1,04 1.04 1.04 1.04 1.04 1.04 7. Annual total ship port days: a. Actual ship berth days 1,262 1,626 2,058 2,128 2,128 2,128 2,128 2,128 2,128 2,128 b. Ship waiting days 25 101 1,152 2,330 2,330 2,330 2,330 2,330 2,330 2,330 c. Ship lightering days 0 0 0 6,636 9,802 13,768 17,612 20,016 22,420 29,752 Total ship port days 1,287 1,727 3,210 11094 14,260 18,226 22,070 24,474 26,878 34,210 C. WITH PROJECT Existing Container Berths 1. Berths (number) 7 7 7 7 7 7 7 7 7 7 2. Traffic ('000 TEUs) 354.0 456.0 577.0 1,363.0 1,820.4 2,130.4 2,340.0 2,597.2 2,854.4 3,639.0 3. Annual ship berth days required 1,262 1,626 2,058 4,861 3,905 4,570 5,019 5,571 6,123 7,806 4. Annual ship berth days available 2,240 2,240 2,240 2,240 2,240 2,240 2,240 2,240 2,240 2,240 5. Berth occupancy rate (%) 56 73 92 95 95 95 95 95 95 95 6. Waiting time queuing factors 0.02 0.06 0.56 0.96 0.96 0.77 0.62 0.62 0.62 0.62 7. Annual total ship port days: a. Actual ship berth days 1,262 1,626 2,058 2,128 2,128 2,128 2,128 2,128 2,128 2,128 b. Ship waiting days 25 101 1,152 2,150 2,150 1,725 1,389 1,389 1,389 1,389 c. Ship lightering days 0 0 0 5,466 3,554 4,884 5,782 6,886 7,990 11,356 Total ship port days 1,287 1,727 3,210 9,744 7,832 8,737 9,299 10,403 11,507 1 New Container Berths 1. Berths (number) I 1 2 3 3 3 3 2. Traffic ('000 TEUs) 164.0 150.6 396.6 726.0 805.8 885.6 1,129.0 3. Annual ship berth days required 651 523 1,224 2,017 2,238 2,460 3,136 4. Annual ship berth days available 300 300 600 900 900 900 900 5. Berth occupancy rate (/o) 95 95 95 95 95 95 95 6. Waiting time queuing factors 0.96 0.96 0.77 0.62 0.62 0.62 0.62 7. Annual total ship port days: a. Actual ship berth days 285 285 570 855 855 855 855 b. Ship waiting days 288 288 462 558 558 558 558 c. Ship lightering days 732 476 1,308 2,324 2,766 3,210 4,562 Total ship port days 1,305 1,049 2,340 3,737 4,179 4,623 5,975 Notes: (i) annual ship berth days required traffic/theoretical daily capacity per berth. (ii) annual ship berth days available = number of berths x berth operating days per year. (iii) berth occupancy rate = annual ship berth days required / annual ship berth days available. (iv) waiting time queuing factors are from Port Development, UNCTAD 1978. and Berth throughput, UNCTAD. 1978. (v) annual ship waiting days = annual ship berth required x waiting time queuilg factors. /_1. Includes foreign (in/out), loaded and empty containers. /F2. Traffic would exceed the practical capacity of these berths. For the purpose of the economic evaluation it has been Assumed that ways will be found, e.g., through lightering, to move the traffic through the port with waiting times not exceeding those corresponding to 95% berth occupancy rate. Sources: Shanghai Port Authority and Bank staff. Jun-99  TABLE 2.7: LOADING/UNLOADING COST SAVINGS SUMMARY (December 1998 prices,Yuan million) Break bulk Coal 1995 1996 1997 1998 1999 2000 2005 1995 1996 1997 1998 1999 2000 2005 A. Traffic demand ('000 tons) 13,975 12,293 12,570 13,550 13,702 13,853 16,535 24,042 17,762 15,520 16,610 17,700 21,540 B. Berth capacity at 95% occupancy rate ('000 tons): Without project 22,742 22,742 22,742 22,742 22,742 22,742 22,742 30,640 30,640 30,640 30,640 30,640 30,640 With project 25,819 25,819 25,209 24,599 24,599 24,599 24,599 45,968 45,968 54,946 54,946 54,946 54,946 C. Traffic handling ('000 tons): a. Without project: Berth 13,975 12,293 12,570 13,550 13,702 13,853 16,535 24,042 17,762 15,520 16,610 17,700 21,540 Lightering 0 0 0 0 0 0 0 0 0 0 0 0 0 Total 13,975 1, 12,570 13,550 1372 13, 16,535 24,042 17,762 j1550 16,610 17,700 21,540 b. With project: Berth 13,975 12,293 12,570 13,550 13,702 13,853 16,535 24,042 17,762 15,520 16,610 17,700 21,540 Total 1 12 12,570 130 1 2 1S3 16 24,042 17,2 150 16,610 17,700 21,540 D. Loading/unloading costs (Yuan million): a. Without project: Berth 102.72 90.35 92.39 99.59 100.71 101.82 121.53 75.73 55.95 48.89 52.32 55.76 67.85 Lightering 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Total 102.72 90.35 92.39 99.59 100.71 101.82 121.53 75.73 55.95 48.89 52.32 55.76 67.85 b.Withproject: Berth 95.38 83.90 85.79 92.48 93.51 94.55 112.85 74.67 55.17 48.20 51.59 54.97 66.90 Lightering 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Total 95.38 83.90 85.79 92.48 93.51 94.55 112.85 74.67 55.17 48.20 51.59 54.97 66.90 E. Net loading/unloading savings 7.34 6.45 6.60 7.11 7.20 7.27 8.68 1.06 0.78 0.69 0.73 0.79 0.95 (Yuan million) Container | Construction Materials C A. Traffic demand ('000 TEU/'000 tons) 1,527.0 1971.0 2527.0 3066.0 3403.0 3740.0 4768.0 1,519 1,133 1,594 1,368 1,764 2,160 2,628 B. Berth capacity at 95% occupancy rate ('000 TEU/ '000 tons): Without project 597.2 597.2 597.2 597.2 597.2 597.2 597.2 1,532 1,532 1,532 1,532 1.532 1.532 1,532 With project 648.5 1094.8 1197.4 1300.0 1300.0 1300.0 1300.0 2-609 3.375 2,837 2,298 2;298 2,298 2,298 C. Traffic handling ('000 TEU/ '000 tons): a. Without project: Bertl 597.2 597.2 597.2 597.2 597.2 597.2 597.2 1.519 1,133 1.532 1.368 1.532 1,532 1,532 r Lightering 929.8 1373.8 1929.8 2468.8 2805.8 3142.8 4170.8 0 0 62 0 232 628 1,096 T" Total 1,527.0 1971.0 2527.0 3066.0 3403.0 3740.0 4768.0 1,519 1,133 1,594 1,368 1.764 2,160 2,628 b. With project: Berth 648.5 1094.8 1197.4 1300.0 1300.0 1300.0 1300.0 1.519 1133 1.594 1,368 1.764 2.160 2.298 Z Cr Lightering 878.5 876.2 1329.6 1766.0 2103.0 2440.0 3468.0 0 0 0 0 0 0 330 > Z Total 1,527.0 1971.0 2527.0 3066.0 3403.0 3740.0 4768.0 L 519 1,133 1,594 1,368 1.764 2.160 2,628 C D. Loading/unloading costs (Yuan million): a. Without project: Berth 250.82 250.82 250.82 250.82 250.82 250.82 250.82 6.30 4.70 6.35 5.67 6.35 6.35 6.35 < Lightering 1,227.34 1.813.42 2,547.34 3,258.82 3,703.66 4,148.50 5,505.46 0.00 0.00 0.81 0.00 3.02 8.19 14.29 0 r Total 1,478.16 2,064.24 2,798.16 3.509.64 3,954.48 4,399.32 5,756.28 6.30 4.70 7.16 5.67 9.37 14.54 20.64 o O b. With project: Berth 267.58 451.73 494.07 536.40 536.40 536.40 536.40 5.56 3.03 4.27 3.66 4.72 5.78 6.15 r Lightering 1,139.23 1,136.25 1,724.22 2,290.14 2,727.16 3,164.18 4,497.28 0.00 0.00 0.00 0.00 0.00 0.00 2.78 ' 23 Total 1,406.81 1,587.98 2,218.29 2,826.54 3,263.56 3,700.58 5,033.68 5.56 3.03 4.27 3.66 4.72 5.78 8.93 E. Net loading/unloading savings 71.35 476.26 579.87 683.10 690.92 698.74 722.60 0.74 1.67 2.89 2.01 4.65 8.76 11.71 (Yuan million) - _ _ o M Notes: 1. The conversion factors for handling cast are: (a) At berth 1.05; and (b) Lightering 1.10. 2. Lightewring costs are taken to be three times handling cost at berth. Sources: Shanghai Port Authority and Bank staff.  SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT 49 IMPLEMENTATION COMPLETION REPORT TABLE 2.8: ECONOMIC BENEFITS SUMMARY (December 1998 prices, Yuan million) 1995 1996 1997 1998 1999 2000 2005 Break Bulk Ports: Loading/unloading savings 7.34 6.45 6.60 7.11 7.20 7.27 8.68 Ships portdays savings 161.34 143.48 151.28 166.58 168.44 170.24 206.67 Cargo port days savings 3.10 3.15 3.52 3.69 3.73 3.75 5.20 Less: Benefits accruing to foreigners (20%) 34.36 30.62 32.28 35.48 35.87 36.25 44.11 Total 137.42 122.46 129.12 141.90 143.50 145.01 176.44 Construction Materials Ports: Loading/unloading savings 0.74 1.67 2.89 2.01 4.65 8.76 11.71 Shipsportdayssavings 149.47 19.11 197.13 47.40 189.94 145.36 30.15 Cargo port days savings 0.94 0.10 1.23 0.27 1.18 0.91 0.19 Total 151.15 20.88 201.25 49.68 195.77 155.03 42.05 Coal Ports: Loading/unloading savings 0.00 1.06 0.78 0.69 0.73 0.79 0.95 Shipsportdayssavings 0.00 0.00 28.19 24.10 26.76 28.66 39.34 Cargo port days savings 0.00 0.00 0.65 0.54 0.61 0.65 0.96 Total 0.00 1.06 29.62 25.33 28.10 30.10 41.25 Container Ports: Loading/unloading savings 71.35 476.26 579.87 683.10 690.92 698.74 722.60 Ships port days savings -70.18 356.00 419.76 486.42 527.70 568.72 694.18 Cargo port days savings -6.31 79.69 100.43 119.57 129.30 138.98 168.66 Less: Benefits accruing to foreigners (35%/6) (1.80) 319.18 385.02 451.18 471.77 492.25 554.90 Total -3.34 592.77 715.04 837.91 876.15 914.19 1,030.54 Total Project: Ports: Loading/unloading savings 79.43 485.44 590.14 692.91 703.50 715.56 743.94 Ships port days savings 240.63 518.59 796.36 724.50 912.84 912.98 970.34 Cargo port days savings (2.27) 82.94 105.83 124.07 134.82 144.29 175.01 Less: Benefits accruing to foreigners 32.56 349.80 417.30 486.66 507.64 528.50 599.01 GrandTotal - 285.23 737.17 1,075.03 1,054.82 1,243.52 1,244.33 1,290.28 Notes: 1. Estimated savings in reduction of loss and damage. 2. Opportunity cost of capital for cargo is assumed to be 10%. Sources: Shanghai Port Authority and Bank staff. Jun-99  TABLE 2.9: ECONOMIC RATE OF RETURN (ERR) AND SENSITIVITY ANALYSIS TABLE 2.9A: ECONOMIC RATE OF RETURN (ERR) AND SENSITIVITY ANALYSIS (December 1999 prices, Yuan million) Total Break bulk Sensitivity Sensitivity Base case Base Benefits Costs Net (-15%) Costs Net (-15%) Benefits Capital Maint- Total cash Costs Benefits Costs (Delay Capital Maint- Total Cash Costs Benefits Costs (Delay Year Invest. enance Total Benefits flow (+15%) (-15%) (+15%) 1 year) invest. enance Total benefits Flow (+15%) (-15%) (+15%) I year) 1991 216.06 216.06 (216.06) (248.47) (216.1) (248.5) (216.06) 61.41 61.41 (61.41) (70.62) (61.41) (70.62) (61.41) 1992 343.13 343.13 (343.13) (394.60) (343.1) (394.6) (343.13) 105.05 105.05 (105.05) (120.8) (105.1) (120.8) (105.1) 1993 417.24 417.24 (417.24) (479.83) (417.2) (479.8) (417.24) 122.10 122.10 (122.10) (140.4) (122.1) (140.4) (122.1) C 1994 508.88 508.88 (508.88) (585.21) (508.9) (585.2) (508.88) 122.33 122.33 (122.33) (140.7) (122.3) (140.7) (122.3) z 1995 538.32 29.70 568.02 285.23 (282.79) (367.99) (325.6) (410.8) (568.02) 110.50 14.00 124.50 137.42 12.92 (5.76) (7.69) (26.37) (124.50) 1996 585.69 33.73 619.42 737.17 117.75 24.84 7.17 (85.74) (334.19) 2.91 14.00 16.91 122.46 105.55 103.01 87.18 84.64 120.51 1997 189.25 54.73 243.98 1,076.18 832.20 795.60 670.77 634.17 493.19 3.06 13.31 16.37 129.12 112.75 110.29 93.38 90.92 106.09 1998 10.59 54.73 65.32 1,055.97 990.65 980.85 832.3 822.5 1,010.9 2.64 13.31 15.95 141.90 125.95 123.56 104.67 102.28 113.17 0 1999 3.41 54.73 58.14 1244.7 1186.53 1177.81 999.8 991.1 997.8 0.00 13.31 13.31 143.50 130.19 128.19 108.67 106.67 128.59 2000 54.73 54.73 1247.9 1,193.20 1,184.99 1,006.01 997.80 1,189.94 13.31 13.31 145.01 131.70 129.70 109.95 107.95 130.19 _ 2001 54.73 54.73 1256.1 1,201.40 1,193.19 1,012.98 1,004.77 1,193.20 13.31 13.31 151.30 137.99 135.99 115.29 113.29 131.70 m 2002 54.73 54.73 1264.9 1.210.14 1,201.93 1,020.41 1,012.20 1.201.40 13.31 13.31 157.58 144.27 142.27 120.63 118.63 137.99 2003 54.73 54.73 1.274.16 1,219.43 1,211.22 1,028.31 1,020.10 1,210.14 13.31 13.31 163.87 150.56 148.56 125.98 123.98 144.27 _H 2004 54.73 54.73 1,284.02 1,229.29 1,221.08 1,036.69 1,028.48 1,219.43 13.31 13.31 170.15 156.84 154.84 131.32 129.32 150.56 C 2005 54.73 54.73 1,294.44 1.239.71 1.231.50 1,045.54 1,037.33 1.229.29 13.31 13.31 176.44 163.13 161.13 136.66 134.66 156.84 r - 2006 68.59 68.59 1,329.60 1.261.02 1,250.73 1,061.58 1,051.29 1,225.86 19.97 19.97 184.40 164.44 161.44 136.78 133.78 156.48 rn 2007 80.58 80.58 1,365.55 1,284.98 1,272.89 1,080.15 1,068.06 1,249.03 19.97 19.97 192.37 172.40 169.41 143.55 140.55 164.44 2008 69.45 69.45 1,402.33 1,332.88 1322.46 1,122.53 1.112.11 1,296.10 13.31 13.31 200.33 187.02 185.02 156.97 154.97 179.06 Z o 2009 54.73 54.73 1,416.01 1,361.28 1,353.07 1,148.88 1,140.67 1 347.60 13.31 13.31 208.30 194.99 192.99 163.74 161.74 187.02 2010 54.73 54.73 1,478.49 1,423.76 1,415.55 1,201.99 1,193.78 1,361.28 113.31 3.31 216.26 202.95 200.95 170.51 168.51 194.99 2011 54,73 54.73 1.519.05 1,464.32 1,456.11 1,236.46 1,228.25 1423.76 13.31 13.31 229.91 216.60 214.60 182.11 180.11 202.95 O 2012 54.73 54.73 1,560.50 1,505.77 1,497.56 1.271.70 1,263.49 1464.32 13.31 13.31 243.56 230.25 228.25 193.71 191.71 216.60 Z t 2013 54.73 54.73 1.602.91 1,548.18 1,539.97 1,307.74 1.299.53 1,505.77 13.31 13.31 257.20 243.89 241.89 205.31 203.31 230.25 g 2014 54.73 54.73 1,622.70 1,567.97 1,559.76 1,324.56 1,316.35 1.548.18 13.31 13.31 270.85 257.54 255.54 216.91 214.91 243.89 r 2015 54.73 54.73 1,690.80 1,636.07 1.627.86 1,382.45 1,374.24 1,567.97 13.31 13.31 284.50 271.19 269.19 228.52 226.52 257.54 r Total 2,812.5 1,157.72 3,970.29 27,008.72 23,038.43 22,442.88 8,987.11 18,391.5 21,347.6 530.00 294.20 824.20 3,926.43 3,102.23 2,978.53 2,513.25 2,389.55 2,817.73 '1 cn ERR 29.2% 26.2% 25.7% 22.9% 24.5% 21.0% 18.5% 18.2% 15.9% 17.9% Z r0 NPV (12%)= 3,260.0 2,956.1 2,467.1 2,163.1 2,604.8 331.8 266.3 216.6 151.0 234.6 Cont'ed H  TABLE 2.9B: ECONOMIC RATE OF RETURN (ERR) AND SENSITIVITY ANALYSIS (December 1999 prices, Yuan million) Ci Coal Container Sensitivity Sensitivity Base case Base case Benefits Costs Net (-15%) Costs Net (-15%) Benefits 0 c Capital Maint- Total Cash Costs Benefits Costs (Delay Capital Maint- Total Cash Costs Costs (Delay Year Invest. Total Flow (+15%) (-15%) (+15%) I year) Invest. Total benefits Flow (+15%) (-15%) (+15%) 1 year) ti 1991 10.62 10.62 (10.62) (12.21) (10.62) (12.21) (10.62) 73.15 73.15 (73.15) (84.12) (73.15) (84.12) (73.15) 1992 6.12 6.12 (6.12) (7.04) (6.12) (7.04) (6.12) 122.31 122.31 (122.31) (140.66) (122.31) (140.66) (122.31) C: 1993 30.51 30.51 (30.51) (35.09) (30.5) (35.1) (30.51) 141.20 141.20 (141.20) (162.4) (141.20) (162.4) (141.20) 1994 162.80 162.80 (162.80) (187.22) (162.8) (187.2) (162.80) 133.46 133.46 (133.46) (153.5) (133.46) (153.5) (133.5) 0 Z 1995 306.32 30632 (306.32) (352.27) (306.3) (352.3) (306.32) 45.94 8.70 54.64 (3.34) (57.98) (66.18) (57.48) (65.68) (54.64) 1996 576.92 4.03 580.95 1.06 (579.89) (667.03) (580.1) (667.2) (580.95) 2.94 8.70 11.64 592.77 581.13 579.38 492.21 490.46 (14.98) 1997 180.03 5.89 185.92 29.62 (156.30) (184.19) (160.74) (188.6) (184.86) 3.09 26.10 29.19 715.04 685.85 681.47 578.59 574.21 563.58 1998 2.64 5.89 8.53 25.33 16.80 15.52 13.00 11.7 21.09 2.67 26.10 28.77 837.91 809.14 804.82 683.45 679.13 686.27 1999 0.00 5.89 5.89 28.10 22.21 21.33 18.00 17.12 19.44 3.41 26.10 29.51 876.15 846.64 842.21 715.22 710.79 808.40 O 2000 5.89 5.89 30.10 24.21 23.33 19.70 18.82 22.21 26.10 26.10 914.19 888.09 884.17 750.96 747.04 850.05 2001 5.89 5.89 32.33 26.44 25.56 21.59 20.71 24.21 26.10 26.10 936.36 910.26 906.34 769.81 765.89 888.09 2002 5.89 5.89 34.56 28.67 27.79 23.49 22.61 26.44 26.10 26.10 959.07 932.97 929.05 789.11 785.19 910.26 2003 5.89 5.89 36.79 30.90 30.02 25.38 24.50 28.67 26.10 26.10 982.33 956.23 952.31 808.88 804.96 932.97 2004 5.89 5.89 39.02 33.13 32.25 27.28 26.40 30.90 26.10 26.10 1,006.15 980.05 976.13 829.13 825.21 956.23 2005 5.89 5.89 41.25 35.36 34.48 29.17 28.29 33.13 26.10 26.10 1.030.54 1.004.44 1,000.52 849.86 845.94 980.05 2006 8.40 8.40 44.78 36.38 35.12 29.66 28.40 32.85 26.10 26.10 1,052.86 1.026.76 1,022.84 868.83 864.91 1,004.44 2007 8.84 8.84 48.62 39.78 38.45 32.49 31.16 35.94 39.15 39.15 1,075.66 1,036.51 1.030.64 875.16 869.29 1.013.71 2008 7.56 7.56 52.78 45.22 44.09 37.30 36.17 41.06 39.15 39.15 1,098.96 1,059.81 1,053.94 894.97 889.10 1,036.51 2009 5.89 5.89 57.30 51.41 50.53 42.82 41.94 46.89 26.10 26.10 1,122.76 1,096.66 1,092.74 928.25 924.33 1.072.86 2010 5.89 5.89 62.21 56.32 55.44 46.99 46.11 51.41 26.10 26.10 1.147.07 1,120.97 1.117.05 948.91 944.99 1.096.66 2011 5.89 5.89 67.99 62.10 61.22 51.90 51.02 56.32 26.10 26.10 1,167.18 1,141.08 1,137.16 966.00 962.08 1.120.97 2012 5.89 5.89 74.31 68.42 67.54 57.27 56.39 62.10 26.10 26.10 1,187.64 1.161.54 1,157.62 983.39 979.47 1,141.08 2013 5.89 5.89 81.22 75.33 74.45 63.15 62.27 68.42 26.10 26.10 1,208.46 1,182.36 1,178.44 1,001.09 997.17 1,161.54 2014 5.89 5.89 88.77 82.88 82.00 69.56 68.68 75.33 26.10 26.10 1,229.65 1.203.55 1,199.63 1,019.10 1,015.18 1.182.36 2015 5.89 5.89 97.01 91.12 90.24 76.57 75.69 82.88 26.10 26.10 1,251.22 1,225.12 1,221.20 1.037.44 1,033.52 1.203.55 Total 1.275.96 123.07 1.399.03 973.15 45.88) (635.69) 7.84) (781.65) (522.89) 528.17 539.40 1.067.57 20388 .63 19.321.06 19160.84 16,262.7 16.102.54 18.069.84 ERR= -3.0% -4.1% -4.3% -5.4% -3.8% 51.9% 48.3% 47.8% 44.3% 43.0% NPV (12%) (619.7) (737.9) (645.0) (763.2) (643.5) 3,386.0 3,312.5 2,804.7 2,731.2 2,905.0 Conted  52 SHANGHAI PORT RESTRUCTURING AND DEVELOPMENT PROJECT IMPLEMENTATION COMPLETION REPORT TABLE 2.9C: ECONOMIC RATE OF RETURN (ERR) AND SENSITIVITY ANALYSIS (December 1999 prices, million Yuan) Construction materials Sensitivity Base case Benefits Costs Net (-15%) Benefits Capital Maint- Total caslh Costs Benefits Costs (Delay Year invest. enance Total benefits flow (+15%) (-15%) (+15%) I year) 1991 70.88 70.88 (70.88) (81.51) (70.88) (81.51) (70.88) 1992 109.65 109.65 (109.65) (126.10) (109.65) (126.10) (109.65) 1993 123.43 123.43 (123.43) (141.94) (123.43) (141.94) (123.43) 1994 90.29 90.29 (90.29) (103.83) (90.29) (103.83) (90.29) 1995 75.56 7.00 82.56 151.15 68.59 (94.94) (82.56) (94.94) (82.56) 1996 2.92 7.00 9.92 20.88 10.96 9.47 7.83 6.34 (9.92) 1997 3.07 6.38 9.45 201.25 191.80 190.38 161.61 160.19 11.43 1998 2.64 6.38 9.02 49.68 40.66 39.31 33.21 31.86 192.23 1999 0.00 6.38 6.38 195.77 189.39 188.43 160.02 159.06 43.30 2000 6.38 6.38 155.03 148.65 147.69 125.40 124.44 189.39 2001 6.38 6.38 132.43 126.05 125.09 106.19 105.23 148.65 2002 6.38 6.38 109.84 103.46 102.50 86.98 86.02 126.05 2003 6.38 6.38 87.24 80.86 79.90 67.78 66.82 103.46 2004 6.38 6.38 64.65 58.27 57.31 48.57 47.61 80.86 2005 6.38 6.38 42.05 35.67 34.71 29.36 28.40 58.27 2006 9.57 9.57 43.40 33.83 32.39 27.32 25.88 32.48 2007 9.57 9.57 44.75 35.18 33.74 28.46 27.02 33.83 2008 6.38 6.38 46.09 39.71 38.75 32.80 31.84 38.37 2009 6.38 6.38 23.50 17.12 16.16 13.59 12.63 39.71 2010 6.38 6.38 48.79 42.41 41.45 35.09 34.13 17.12 2011 6.38 6.38 49.81 43.43 42.47 35.96 35.00 42.41 2012 6.38 6.38 50.84 44.46 43.50 36.83 35.87 43.43 2013 6.38 6.38 51.86 45.48 44.52 37.70 36.74 44.46 2014 6.38 6.38 29.27 22.89 21.93 18.50 17.54 45.48 2015 6.38 6.38 53.91 47.53 46.57 39.44 38.48 22.89 Total 478.44 141.60 620.04 1,652.19 1,032.15 787.95 655.83 562.78 827.09 ERR= 16.8% 10.6% 10.3% 8.1% 11.0% NPV (12%) 105.2 -36.8 -39.8 -96.0 -25.7  IBRD 24093 \Fi3 \c3 'FPI'L \ 310C' \- 'j JIANGSU JBau- Luodia Ii.--C- t Tmr~ns --- sn0 "t110'/ / X \ - i,Booshon~~~~~~~~~~~~~~~~~4ghi N. ~ ~ ~ ~ ~ ~ ~ ~ ocgism~~~~~~~~~~~~~ 6TL,~~~~~~~~~~~ \O~~.n. /s \ 0 \j ZHE\IANG Courny Bonais O Province Budre Luodian ~ ~ I .UO '--\ Boso LI IS 52IS030N1C\ Vousonri5 Kou / I X T g , S < GE ERALCARGO Gaoqiao \ /. RNERAL CARG Wusong ~~AND CONTAINERS Wusongg ._ S A G I iTccDISTRICT NO C C GENERAL CARG O DAGROUS CARGO Gaoqiac SDf - . . AND CONTA NERS - SHANGH ST>MCT15e9 SRTO < ~ ~~~~ ~ ~ ~~~~~~~~~ DI STDiRICT N IC1 U Zhiae ,GPNERAL CARGCT GN CARG 5 DIS.RICT NO S C NOT O , n ZRSC Ia GRNCOAL GNRLCARGO n T . l # SDSTRCD NOT I RNRPAL CARGO PON ORE MA TERA CGA NO... 12'O. IAATE~~~ ALS COALCOA Hongqiao International AirportIDSC N E GEERCT 0 OI LOGS EG R<j C H I N A 7f 8C I SHANGHAI PORT PROJECT mpr- PROPOSED PROJECTS ></ //4' PREVIOUS PROJECTS IMM (EXISTING PORT FACILITIES N= R< -~-- ROADS -+=: =- P RAILROADS To Horngzh-u / / RIVERS AND CANALS This -mp hos been prepored by The World B-aRk snofe -6,co-y fVR AN CA he convenience of roders and is for the meo- use of The Wadd Guangang j / Bok Grsp. ThS dn--miar-ns -ed ant thSeb ms-rs shn onths C 0 2 4 6 8 10 nap onotimply on th part f The World BRk Group any- dg-ent - I on the le gal sirtabs of any tarnd lay or atny endorsenmen t oreoccnpsonce of .ILMERR -uch b-nde_- KILOMETERS SEPTEMBER 1992