Ports have long played a vital role in the international transport system, but have become increasingly important since the second half of the twentieth century with the rapid globalization of the world economy and expansion of world trade. The basic functions of a port are to provide a link between land and sea transport and to furnish the means by which transfers of freight and passengers between the two systems can be made efficiently. But today ports are "not just a transferring point between different modes of transport but also logistics hubs and centers in global transport chains" (Inoue 2002). High port and other transport costs can act as barriers to trade; that is, if the cost of production plus distribution (including transport costs) exceeds the income received from selling the product, trade is unlikely to occur. Until the late eighteenth century high transport costs (on land, at sea, and in port) meant that only high-value commodities such as precious metals and spices were traded internationally on a large scale. By the second half of the nineteenth century, however, increased efficiency in both land and ocean transport had led to large falls in freight rates and facilitated a major expansion of world trade and the emergence of an integrated world economy (North 1958 and McInnis 1986). Between 1870 and 1998 exports increased from 4.6 percent to 17.2 percent of world GDP (Maddison 2001, p. 363). In 2002 the world's ports handled a record 5.88 billion tons of cargo (Organization for Economic Cooperative Development 2003). The growth of international trade was, of course, due to many factors, but ports played a key role as value-adding links in the international transport system.
CHARACTERISTICS OF PORT CITIES
There is a wide diversity of port types, including specialized naval ports, entrepôt ports, coastal ports, and overseas ports, so there is a correspondingly wide variation in the relative scale of maritime and industrial activity, urban expansion, and the influence of ports on regional and national development. However, the development of most major ports has been intertwined with that of a city. To qualify as a port city "the port must become the central dynamic force and organising principle of the port city, and not remain a 'hidden function,' a mere appendage." (Reeves, Broeze, and McPherson 1989, p. 39). Thus a port city depends on the port for a large part of city employment and incomes.
An early example of a leading European port city is Venice, which from about 1000 to 1500 played a major role in developing trade within Europe and the Mediterranean and also acted as a gateway for technology transfer from Asia and Egypt to the West (Maddison 2001, pp. 52–57). From the late seventeenth century onwards, port cities such as Amsterdam, Genoa, Gothenburg, Hamburg, Liverpool, London, Marseilles, Portsmouth, and Rotterdam were the front-runners in urban development in Europe. By the eighteenth century Western Europe was "an effectively integrated area, with port-cities functioning as key connecting links in terms both of national and international trade and of capital and labour mobility" (Lee and Lawton 2002, p. 2). The development of North and South America depended on sea transport, and led to the emergence of new port cities such as Buenos Aires, New Orleans, New York, San Francisco, Vancouver, and Veracruz. During the nineteenth century Asian ports such as Bombay, Colombo, Singapore, and Shanghai formed the hearts of cities which constituted the meeting places of European and indigenous cultures and facilitated Western economic penetration into Asia. The Australian capital city ports that were established between 1788 and 1837 similarly provided the British Empire with gateways into the vast Australian continent. Port cities accounted for about 40 percent of the world's cities, with populations of more than 100,000 in 1850, and they dominated the "European urban hierarchy" until the 1950s, when they were finally overtaken by industrial cities (Lee and Lawton 2002, p. 3).
The fluctuating nature of cargo flows meant that the cheapest way to meet the varying demand for port labor was to maintain a large casual labor force. The need for large amounts of unskilled labor meant that port cities acted as magnets for migrants, one outcome of which was residential segregation based on ethnic group and socioeconomic status. Apart from direct employment in trade and shipping, ports were centers for many related industries such as fish processing, flour milling, soap making, sugar refining, and, from the twentieth century, oil refining. The political structure of port cities was usually dominated by mercantile and shipping interests who, through their trading activities, had amassed wealth and prestige. Port cities typically enjoyed a cosmopolitan atmosphere as they were places in which "races, cultures, and ideas as well as goods from a variety of places jostle, mix, and enrich each other and the life of the city" (Murphey 1989, p. 225).
CHANGE AND REFORM SINCE THE NINETEENTH CENTURY
Since the nineteenth century the world's ports and their cities have been forced to adjust to major changes in trade, shipping, and cargo-handling technology. In the nineteenth century they needed to adapt to the development of large iron ships and the replacement of sail by steam as a source of propulsion; in the first half of the twentieth century, the ports were required to provide bulk handling systems for liquid and dry cargoes; and, after World War II, they had to make available deep water for huge bulk carriers and space for technological innovations such as containerization. Following the introduction in 1966 of the world's first fully integrated container service into the North Atlantic trade by Sea-Land Service Inc., the handling of general cargo was rapidly transformed from a manual activity, requiring a large labor force, to a capital intensive one, requiring minimal "muscle power" (Broeze 2002).
As the cities grew, ports increasingly "competed" for land with industry, housing, and other urban uses. After World War II many ports escaped from their metropolitan straitjackets and developed new ports with access to deep water and adequate land areas. Sometimes the existing inner-city facilities were no longer required for commercial port operations and fell into decay. Container terminals, for example, required specially designed wharves, and made existing wharves, otherwise useable for many years, obsolescent. The port and city authorities were also forced to either demolish or find alternative uses for old cranes, cargo sheds, warehouses, and other port facilities. Some imaginative uses for cargo sheds and warehouses included museums, art galleries, restaurants, and shopping arcades. A well-known example of water-front redevelopment is found in the Port of London, where the London Docklands Development Corporation converted the old docks, stretching from Stepney to Woolwich, for commercial industrial, residential, and recreational use.
As the scale and complexity of ports grew, so did the need for unified systems of administration and control. The establishment of the Mersey Docks and Harbour Board in 1857 marked the beginning of modern harbor management; the board created a model which was widely copied around the world. However, after World War II many ports suffered from inefficient management practices, overstaffing, and inflexible labor arrangements (Tull 1999). Waterfronts were frequently plagued by major industrial disputes. Numerous attempts to deal with these problems were unsuccessful until the 1980s, when corporatization, privatization, and labor-market reforms succeeded in placing the management and operation of many ports on a more commercial basis. With the notable exception of Britain, where about 70 percent of port capacity is currently in private hands, the state usually retains ownership of the land and control of regulatory functions but allows the private sector to assume responsibility for cargo handling and other port operations (Baird 2000, pp. 402–403).
Due to these reforms and the general progress of mechanization, port workforces have shrunk to only a small portion of a city's total employment. In the 1990s Rotterdam, for example, was a thriving world-class port, but the city struggled as unemployment reached 15 percent (twice Holland's national average), although this was not due to changes in the port alone (Graafland and Hauptmann 2001, p. 31). Job loss due to technological change is an especially serious issue in developing economies. In 1995 the Port of Colombo in Sri Lanka, for example, had a staff of about 17,000 who handled just over 1 million twenty foot equivalent units (TEUs) of containers, whereas Singapore with a staff of about 4,000 handled 12 million TEUs. Like many other public enterprises in Sri Lanka, the port was used as a "job bank," and the cost of employing excess labor was passed on to port users and ultimately consumers (Dharmasena 2003, p. 441). In a competitive, globalized economy, governments are coming under increasing pressure to curtail such practices and to facilitate the transfer of underemployed labor into more productive uses, especially in export-oriented industries.
The increasing size of container ships and competitive pressures are leading shipowners to concentrate container trade in hub ports served by a range of smaller feeder ports (Broeze 2002). In order to acquire or maintain hub-port status, ports need to undertake large-scale investment in new technology such as automated container terminals and further improve labor productivity. The huge scale of the investment required has led to large numbers of public/private-sector partnerships, and to the rise of multinational port operators such as Hutchison International Port Holdings, International Container Services Inc., Port of Singapore Corporation, and P&O Ports.
Many cities began as ports, but as they have grown, port activities have gradually been overshadowed by manufacturing, financial, or service activities, and port-related activities, although usually still vital to the economy, have been relegated to a relatively "hidden" role. Frank Broeze's comment on Australian ports can be applied to the world's ports in general: "the port city as a social phenomenon has largely ceased to exist: despite the huge space taken up by harbours and ancillary installations, Australia's port cities have in fact become general cities that also happen to contain ports" (Broeze 1998, p. 174). The development of new harbor areas away from the inner-city areas means that shipping activity is far less visible to the general public. Ships are more sparsely crewed and spend less time in port, leading to the decline of "sailortowns"—the areas containing taverns and other service industries catering for itinerant sailors. Container crane operators are isolated in their cabs high in the air, and with fewer workers around there is less opportunity for the development of the union solidarity for which the waterfront was well known. It was recently stated that Melbourne, a leading Australian port, "could not continue to thrive and maintain its position as a pre-eminent international city without a vibrant and well-run port. The futures of both are inseparably entwined; if one withers, so will the other" (Lloyd's List Daily Commercial News,: 27 May 2004). Although the relationship between ports and cities has changed, their fortunes are still intertwined.
SEE ALSO Amsterdam; Antwerp; Bahia; Baltimore; Barcelona; Bordeaux; Boston; Bristol; CÁdiz; Calcutta; Cargoes, Freight; Cargoes, Passenger; Cartagena; Chambers of Commerce; Charleston; Containerization; Free Ports; Gdansk; Genoa; Glasgow; Guangzhou; Hamburg;Hanseatic League (Hansa or Hanse); Harbors; Havana; Home Charges (India);Hong Kong;Hong Kong and Shanghai Bank; Imperial Maritime Customs, China; Jardine Matheson;Los Angeles–Long Beach;Melaka;Mumbai;Nagasaki;New Orleans;New York;Porto;Salem;San Francisco–Oakland;Rio de Janeiro;Rotterdam;Seville;Shipbuilding;Shipping, Coastal;Shipping, Inland Waterways, Europe;Shipping, Inland Waterways, North America;Shipping, Merchant;Ships and Shipping;Singapore;Veracruz;Yokohama.
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