Monday, May 21, 2007

Port Not Ready for Military

Port not ready for buildup
Businessman: Increase capacity, improve efficiency
By Gaynor Dumat-ol Daleno
Pacific Daily News
May 22, 2007

A Defense Department representative has identified the local government-run seaport as a potential chokepoint in the upcoming massive military buildup on Guam, a member of the local business community said yesterday.

The military buildup -- and its ripple effect on the already robust housing market -- is expected to double the volume of cargo entering through the island's only civilian seaport, which is being run by the Port Authority of Guam.

How island officials will handle the port issue -- and whether their actions will be made in time for the buildup within the next several years -- has an effect on the standard of living of everyone on the island, businessman Carl Peterson said.

Peterson voiced his concern in light of what he called sincere and straightforward comments Friday by Gary Kuwabara from the Defense Department's Office of Economic Adjustment.

Kuwabara is the Office of Economic Adjustment's point man for military buildup issues on Guam and makes periodic visits to the island from Washington, D.C. He spoke Friday after subcommittee representatives of the governor's task force on military buildup gave status reports.

Peterson attended the meeting as a Guam Chamber of Commerce representative, but the comments he made for this story were not made on behalf of the Chamber.

Peterson said Kuwabara had mentioned the need for upgrades to the seaport.

A more efficiently run port ensures on-time delivery of goods for Guam consumers, businesses and government entities, but a major breakdown in cargo movement could lead to shortages and possibly more expensive goods, as was Guam's experience years ago.

With the buildup's expected $10 billion to $15 billion cost, the local community also is expected to see substantial economic growth.
The reason for the urgency, said Peterson of the need to modernize the port's operations and expand its capacity, is that every Guam resident's standard of living will be adversely affected if the port stays stagnant.

All the construction related to the relocation of about 8,000 members of the Third Marine Expeditionary Force and their approximately 9,000 dependents from Okinawa must be done within the next several years.

Based on the agreement between the U.S. and Japan, the relocation must happen by 2014. Japan is picking up about 60 percent of the relocation cost.

According to Peterson, Kuwabara at Friday's meeting of the governor's task force on military buildup said when the buildup is at full blast, 72,500 military supply containers are expected to be shipped to Guam in the span of one year.

Kuwabara could not be reached for comment yesterday.

The port has handled an average of 84,000 containers annually, its management stated.

Based on Kuwabara's comment at the task force meeting, Peterson said the sense he got was that the local government must make enormous changes to bring the port up to speed with the anticipated surge in incoming cargo traffic.

In addition to military supplies, the island also is expected to see a surge in shipment of construction materials to meet the demands of a booming housing market.

Logistics and shipping companies last year said that if one gantry crane breaks down, even before the buildup occurs, the island economy could be held hostage by an equipment malfunction.

Peterson suggested that the Port Authority of Guam should invite the world's experts on running ports to submit proposals for how they can better run the seaport and how much it would cost for them to do so.

The port agency's attempt last year to hand over cargo handling operations to a private operator has failed.

And the port agency board "has not made any determination on what their next step will be" on the privation issue, according to a statement from port management yesterday.

The port management stated: "In the late '90s, when the island experienced its last military buildup, the port was able to handle the increased number of containers."

As for the port's years-long efforts to try to buy a new gantry crane, which moves containerized cargo on and off ships, it's likely the process will take about two more years.

The agency's evaluation committee is reviewing the proposal submitted by the lone bidder for the manufacture and installation of a new gantry crane, according to the port agency management.

The agency stated the estimated time from manufacturing to delivery of a new gantry crane: 18 months to two years.

In addition to trying to order a new gantry crane, the port management stated the agency is "in the process of acquiring new handling equipment to deal with the increase of cargo arriving on Guam."

"We are also currently reviewing our terminal infrastructure to determine the type of operations the port should implement to effectively off load/load cargo onto vessels," according to port management.

And the port agency yesterday stated it is hiring a consultant to update its master plan.

Labor shortages
Friday's meeting also discussed the labor needs for the buildup as well as the private sector's need for more construction workers.

Based on an informal estimate, Guam might need 25,000 additional construction workers to meet both the military and the private construction projects' needs, said David Dell'Isola, a Guam Department of Labor representative, said at Friday's meeting.

The military buildup-related projects will need between 12,000 to 15,000 workers, said Capt. Robert Lee, acting director of the U.S. government office on Guam that coordinates buildup efforts.

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