China’s Quiet Leadership in Port Tech Innovation

One of my research subjects at China’s Antai College of Economics and Management, Shanghai Jiao Tong University, is the wide variety of sectors in which Chinese enterprises’ tech innovations are leading the world but are, as yet, largely unnoticed and underappreciated. Two examples are the consumer-smartphone interface and the EV ecosystem, both of which China dominates in terms of sheer market share. But Chinese enterprises’ innovations in both sectors are also world-leading. Moreover, the two sectors are merging, because, as the saying goes, an EV is basically a smartphone on wheels. The confluence of these two technology families will contribute mightily to the coming revolution in mobility, and Chinese enterprises are pursuing this ‘merger’ with uncommon vitality and focus.

Ports are another category in which Chinese enterprises are pioneering new tech territory. Most people never think of ports at all and have never seen one. Yet ports handle 50% of all global trade, and I guess most urban citizens worldwide don’t go an hour without touching something that has made its way through a port.

Tech-driven innovation at ports produces major societal benefits – reduced carbon emissions, safer working environments and dramatic increases in efficiency – thereby lowering costs. Since China’s ports process roughly 50% of all global port traffic, it’s intuitive that the country’s ports should also be at the center of world-class tech innovation. Seven of the top 10 ports in the world by container volume are in China (Shanghai’s is number one by far), and the country’s ports in aggregate handle about four times as much container volume as US ports do.

About a year ago, the Port of Tianjin (number nine globally in container volume) became the first in the world to open a zero-carbon smart container terminal – a collaboration between the Tianjin Port Group, Huawei and a number of other partners.

The ‘smart’ comes from automation of what’s called ‘horizontal’ transportation: point-to-point container handling between the port gate and the ships. All the likely tech tools are key factors in the achievement – 5G and AI and cloud of course, plus China’s Beidou Satellite Navigation System. These support key components of the system, such as AI transportation robots (ART), automated loading cranes and everyday use of driverless container transport vehicles.

The zero-carbon achievement comes largely from the efficiency of automated operations – because efficiency reduces turnaround time and in-port use of ships’ auxiliary engines. Hong Kong, to name just one port city, has long considered emissions from berthed ships to be a primary source of overall air pollution there. Two 4.5 MW wind turbines on-site contribute an essential component.

The Port of Qingdao (seventh in global container volume), already the first fully automated port in Asia, announced in the summer that they’d also become the first port globally to power their loading cranes and other equipment with hydrogen technology. They project that the combination of automation efficiency and hydrogen power will cut 21,000 tons of carbon dioxide and 640 tons of sulfur dioxide emissions per year.

In what may be the most ambitious project, China Merchants Port is developing a project encompassing several ports in the Greater Bay Area (Hong Kong, Shenzhen, Guangzhou, and Zhuhai), extending up the Pearl River to inland ports, extending up the supply chain to manufacturers, and integrating with adjacent smart city initiatives. Again, and of course, 5G, AI, cloud-based networks and the Beidou satellite system, all of which Chinese enterprises are constantly demonstrating innovation leadership in, are the technology platforms underpinning the development.

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With China’s largely dominant position in global port operations, it’s only natural that domestic port operators, private sector tech innovators, and the municipalities adjacent to the ports, will extend and deepen their global leadership – in world-first technology applications that further enhance efficiency, net carbon emission reduction and worker safety. It’s also likely that these innovations – these substantial contributions to societal well-being not only in China, but worldwide (as other ports globally learn from Chinese ports’ leadership in technology innovations) will continue to be underappreciated, because who pays much attention to ports? However, I suggest that a combination of the many under-appreciated tech evolutions in China, in many sectors, will yield powerful but as yet unheralded upside for the overall economy and for the world.