APM Terminals

Developing public-private partnerships for port development

A ‘win-win’ model in action

APM Terminals has established quite a presence in the western hemisphere and particularly in the Caribbean, Central America and South America. And, with 6.5 per cent growth projected for Latin America by Drewry Maritime Research, it is now clear that Latin American container markets will continue to be a focus area for the European giant.

APM Terminals already operates facilities in Buenos Aires, Argentina (Terminal 4); and Itajai and Pecem, both in Brazil. In July last year APM Terminals added Muelle Norte in Callao, Peru, to its list of terminals, having won the concession in a competitive tender process. 

Other recently announced investments in Latin America include the construction of new facilities in Moin, Costa Rica; Lazaro Cardenas, Mexico; and Santos, Brazil.

Kim Fejfer, chief executive of APM Terminals, said: “With over 550 million people and significant growth in seaborne trade, Latin America has unmet demand for access to the global logistics chain. APM Terminals will pursue opportunities in the region to facilitate trade and support economic growth.”

Joe Nielsen, former chief financial officer for APM Terminals’ activities in the Americas Region, has been appointed managing director, Latin American Terminals.

Mr Nielsen, who is based in Panama, said: “Having being able to add port terminals to our regional portfolio and improve access to global trade for the related countries is the result of hard work of our business development team in Latin America, in close cooperation with our local partners, governments, port authorities and other key stakeholders. APM Terminals will continue to explore opportunities throughout the region and support modernisation of infrastructure.”

Looking back at the successful Callao tender, Robert Bosman, APM Terminals’ general manager Business Development Americas, said: “We worked on the Callao project for one and a half years … closely with our local partner, Central Portuaria, the Peruvian government and the port authority. We started the process by proposing a private initiative to the Peruvian government in which we offered to modernise and operate Muelle Norte as a multipurpose terminal. We invested a lot of man-hours and knowledge in this proposal and initially you do not know if your proposal will be accepted. But we always believed in this project. The government liked our plan and decided to start a public tender process for Muelle Norte.”

The concession contract guaranteed the Peruvian government investments of US$ 749 million in modernisation of the terminal. This level of investment will ensure that Peruvian importers and exporters have an efficient and reliable multipurpose terminal. This is important for Peru as the Port of Callao is the nation’s main gateway for international trade and a potential hub for the west coast of South America. 

APM Terminals connect with governments and local port operators to build long-term mutually beneficial partnerships for the development of port infrastructure to a level that countries need in order to stay competitive in international commerce, given the rapidly developing customer requirements and market demands of today’s world. This model of cooperation works well and offers advantages for port terminals in the region. Such advantages include operational knowledge, commercial relations with over 60 shipping lines, global training programmes, access to equipment contracts, information systems and other economies of scale which APM Terminals, as an international operator, can offer. 

A good example is the case of the Muelle Norte in Callao (mentioned previously), now operating as APM Terminals Callao. Since assuming control of Muelle Norte on July 1, 2011, crane productivity has increased to more than 26 moves per hour per crane. Gate turnround time has decreased by 49 per cent to 28 minutes in the first 29 weeks of operations. Already, APM Terminals has invested US$ 27 million of a total of US$ 749 million earmarked to modernise and expand the existing facility. Plans are to build a terminal which will eventually have a capacity of 2.9 million teu. The installation of a new grain silo will allow for 9.9 million tons of general cargo capacity over the next decade.

“In APM Terminals we believe in the development of an environmentally sustainable and safe operational platform, as everywhere in our terminals around the globe,” said Mr Bosman.

A good example of this is the use of electric rubber tyred gantry cranes in Callao. The development of the new terminal of APM Terminals in Moin, Costa Rica, will see full implementation of these policies. The focus will not only be on environmental protection measures but, equally importantly, the introduction of clean energy sources for reducing carbon dioxide emissions at the Moin facility, with recycling processes at all levels within the operation as well in the community at large. Through job creation, health and safety initiatives, business practices, proactive environmental policies, APM Terminals sees great potential to create positive change in local communities, a responsibility that is clearly taken very seriously.

Safety is a global priority within APM Terminals.

“We want our employees to go home safe and in good health after a working day,” said Mr Nielsen. “We made significant positive changes in terminals that we took over around the world, but we always want to improve further. We have a zero tolerance on safety issues.” 

The safety culture of APM Terminals was recently acknowledged in the United States, where the company was presented with the Gerald H. Halpin Safety Excellence Award for 2010-2011 by the Signal Mutual Indemnity Association. APM Terminals’ operations in the USA were cited for Signal’s highest award, which recognises the Signal member that best exemplifies the promotion of employee safety and health throughout its organisation. Accident prevention and safety culture are at the very heart of APM Terminals’ daily operations throughout the world.

Last year the company also won the Lloyd’s List Global Safety Award.

Mr Bosman believes APM Terminals has a lot to offer in developing port terminals throughout the region. And he says this has been proven by the new terminals in which the company is engaged.

“APM Terminals’ management style is transparent, open and straightforward,” he said. “We work according to our values and we have clear business principles. We truly want to create and operate efficient, safe and environmentally sustainable port terminals with our partners, enabling countries to compete effectively in global trade and facilitate economic growth.”

Joe Nielsen agrees. “We truly believe that public-private partnerships and other types of cooperation between developing port terminals in Latin America and APM Terminals can be developed in such a way that it is mutually beneficial. National interests are protected and efficient port terminals for the future are ensured, offering services that customers need. 

“This will enable countries to connect competitively to global commerce. Infrastructure is a key priority to avoid bottlenecks for further growth in Latin America. APM Terminals have seen and created examples in Latin America of successful port infrastructure projects. We are confident that we will see more successful regional port infrastructure projects in the future and APM Terminals wants to be part of that.”