PIL partners with China Merchant Port to build new markets in Asia, Africa

PIL CEO Ho Meng Kit signs the MoU with CMPort and CMEC. Credit: PIL



Pacific International Lines (PIL) has signed a memorandum of understanding (MoU) with China’s largest public port operator and a mainland construction giant to develop new markets in Southeast Asia, South Asia, and Africa as part of the country’s One Belt, One Road (OBOR) trade strategy.

The Singapore-based carrier is partnering with China Merchant Port Holdings (CMPort) and China Machinery Engineering Corporation (CMEC).

PIL managing director Teo Siong Seng said at the signing ceremony that the collaboration was another example of the potential benefits for businesses from OBOR.

Under their MoU, PIL and CMPort will co-ordinate their resources and develop new markets through joint ventures (JVs). This is expected to strengthen developments in Africa, South Asia, and Southeast Asia and boost existing co-operation in China. The companies will jointly explore cold-chain logistics opportunities.

The partnership between PIL and CMEC is largely focused on Africa. The companies will establish a JV company in Singapore to develop container depots, inland transport, and total logistics solutions in the continent.

PIL and CMEC will collaborate in joint shipbuilding, sub-leasing, and vessels management in Africa, combining CMEC’s engineering expertise with PIL’s ship operations and management knowledge.

PIL owns and operates with a fleet of more than 160 modern vessels. It has a significant presence in the Far East, Africa, the Americas, Europe, the Middle East, the Indian sub-continent, Oceania, and Southeast Asia.

Southeast Asia’s infrastructure is emerging as a major beneficiary of China’s OBOR initiative. Chinese companies accounted for 17% of infrastructure investment across the region over 2015, according to a report by Citibank.

Major Chinese-invested port projects in Southeast Asia include the expansion of Kuantan Port and phase one development of Samalaju Port, both in Malaysia, by Guanxi Beibu International Port Group and China Harbour Engineering Company.

Tanjung Sauh Port on Batam Island in Indonesia is also being developed by China CAMC Engineering Company. A deep-sea port on Madae Island, Rakhine State, Myanmar, is being constructed by China National Petroleum Corporation.

Contact Greg Knowler at greg.knowler@ihsmarkit.com and follow him on Twitter: @greg_knowler.