Cities 1994 11 (5) 332-336

Viewpoint The emerging global city: transport

Nigel Harris Development Planning Unit, University College, 9 Endsleigh Gardens, London WC1H OED, UK

Cities are emerging as pre-eminently junctions in flows - of people, goods, information and finance. The need for 0-error systems of transfer is exemplified in manufacturing with Just-in-Time stock policies - reliable movement of inputs and outputs is fundamental to maintaining manufacturing. The reorganiza- tion of seaports and shipping provides a dramatic example of the pressure to minimize delays; inefficiencies here can severely damage a county's export performance. In airports, the same is true of freight movements. Thus the role of urban management in sustaining the efficiency of land movements to sea and airports becomes crucial to the competitive strength of cities.

Much attention in the field of urban transport is devoted to movement within the city, by motorized vehicles, train or mass transit systems. How- ever, cities - particularly now those in developing countries - are being reshaped as national economies open up to virtually unmediated global mar- ket forces, and external interactions become accordingly much more im- portant. Changes in sea and air trans- port, interacting with the growth and technological transformation of manu- facturing and services, are reshaping the role and form of big cities in unexpected ways. This short article contributes to identifying some of the themes in this agenda.

I have argued elsewhere (Harris, 1991) that the form of large city cur- rently emerging is less easily seen as a fixed location for the production of goods and services as in the past, but rather as a set of junctions in flows, an intermodal transfer and control point in the movement of people, goods, finance and information. The sources and destinations of the flows are fre- quently beyond both the authority and even the knowledge of governments. They are also subject to unpredictable

fluctuations so that the management of the city needs to be both completely reliable but also flexible; a 0-error transport system, but with the capacity for rapid expansion and contraction when necessary.

The arrival of Just-in-Time (JIT) stock policies in manufacturing and trade exaggerates these requirements. Production and supply are being reorganized as continuous flows from basic inputs to final output, with very little accumulation of stocks in be- tween. The system is accordingly high- ly vulnerable to major losses if flows are interrupted. The complexity can be very great - from hundreds of component suppliers on one side of the world, with goods staggered through each factory, along highways and railways, loading and unloading at air and sea ports, and transshipment at various points on, again, roads and rails to a variety of assemblers in different places on the other side of the world. In the retail trades, stocks may be replenished on a daily or hour- ly basis over great distances in re- latively small batches. Consider the reorganization of transport required when New York boutique owners

tried to contract Taiwanese garment manufacturers to replenish stocks in New York within 24 hours of issuing the order.

The emergence of a fully integrated world manufacturing system implies that an increasing proportion of the world's output will be moved, a con- tinuation and possible acceleration in the trend since 1950 for international trade to expand faster than produc- tion. The final output increasingly be- comes no more than the final assembly of inputs made in many different countries. Slower world growth rates and recessions have not deflected this trend, nor the increasing dependence of demand for manufactured goods in the developed countries upon supplies from the developing countries - Belas- sa (1991) has calculated that in the decade before 1973, a 1% increase in the combined gross domestic produc- tion of the developed countries was associated with a 3.6% rate of growth of manufactured exports from de- veloping countries; in the 14 years between 1973 and 1987, the equivalent figure was 4.0%. The growth was par- ticularly important in engineering goods (developing country exports in-

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creased between 1963 and 1988 by 21% per annum) and chemicals.

It is well known that the cost of moving long distances by sea or air is a small element in the total cost of ship- ment from door to door, particularly compared to the costs of moving through junction points, loading and unloading. It is here that the most impressive savings have been made, although costs are still high, especially in developing countries, in the transi- tion from land routes to air and sea. The management of the land transport system, part of the economic manage- ment of the city, is thus particularly important for national economic per- formance - and maybe much more important economically than the scale of investment in transport hardware. Rapid and cheap movement is a key factor in an economy with aspirations to raise exports, develop integrated manufacturing systems (where im- ports are key inputs to exports), and export services, whether this consists in sending people with skills abroad or receiving people in search of services from abroad (as with tourism, medical or educational services, etc).

S e a p o r t s

The pos t - second-wor ld -war trans- formation in the character of sea trade along with the extraordinary growth in the volume of goods carried is well known, combining radical changes in port organization which have meant that the old ports have, in the de- v e l o p e d c o u n t r i e s , e n t i r e l y dis- appeared; changes in ship design and navigation; changes in the electronic monitoring of the entire movement system, and the development of multi- modal integration (combining road, rail, sea and air in a complete door-to- door service). In the developed coun- tries, there is even the introduction of virtually automated dock and ship l o a d i n g fac i l i t i e s . The po r t has changed out of recognition - from a transport system (combining trans- por t , t ransshipment , s torage, and associated raw material p r o c e s s i n g - flour milling, oil refineries, gas plants, etc) to a distribution centre (packing and unpacking containers, stock keep- ing, processing) to a logistic or man-

agement centre, monitoring and su- pervising world sea movements (Dol- man and Ettinger, 1992; Peters, 1989); the Global Positioning System can now monitor ships within 150 feet of their sea location.

The increase in productivity (includ- ing the speed of turnround) has been prodigious. In the typical old berth, 100 men could handle on average 1 200 tonnes in seven or eight hours; in the modern berth, 20 men handle 6 000 tonnes in the same time; the tonnage handled per berth has in- c reased ten t imes over . At Los Angeles-Long Beach, the 14 500 long- shoreman of 1950 handled 0.837 ton- nes per man hour; the 8 400 of 1980, handled 5 498 tonnes; the cost of handling per tonne was cut by 30%, while hourly real pay rates for the dock labour force increased four times over. Cumulatively, the change has been the most revolutionary since sail gave way to steam.

The problems are also well-known. The most obvious one is the displace- ment of the workforce. The Port of London, it is said, employed close to 50 000 workers in the 1960s; 14 000 in 1983; and some 3 000 to 4 000 in 1990. Containerization and the development of inland stripping and stuffing depots displaced employment from the old dock areas, and also cut the supply of inputs to waterside manufacturing plants (as with sugar, flour, crude oil, coal, etc). Container ports required much more extensive land tracts than are available in inner city port areas to manage the container stacks and so minimize delays in their movement; thus, new ports tend to be located in green field sites, leaving the old port localities as derelict areas, compound- ing the problems of inner city decline. With t ime, this may provide the opportunity for major urban develop- ment schemes to transform the city economy - as in Yokohama, the Darl- ing Bay scheme in Sydney, or Dock- lands in London (a key factor in the growth and change of London's finan- cial quarter). But the transition period can be most painful for the luckless inhabitants t rapped in a desert of urban blight, victimized by the pursuit of a productivity which brings fabu- lous gains to the beneficiaries and

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could therefore also ease the costs of change.

The speed of the technical upgrad- ing of ports in developed countries and a handful of those elsewhere (pre- eminently Singapore and Hong Kong) can also marginalize many developing countries, increasing the costs of their ex te rna l t rade . Many deve loping country ports are now high-cost junc- t ions, with slow land connect ing routes and badly managed traffic sys- tems. Since of the total cost of door- to-door movement, between half and three-quarters is incurred in inland transport and port handling, even con- tainerization may not help a develop- ing country without radical improve- ments in transport management, espe- cially where this involves travel on city highways. The management of the dock area is likewise crucial for speed - Montreal has set its target as turning round trucks entering the dock area fully loaded and leaving fully loaded with new cargo at 20 minutes. Foreign shipping lines may increasingly refuse to deliver cargo to high cost ports, preferring on the global routes to drop loads at the most efficient ports (for example, Singapore) to be collected from there for the surrounding region (from India to Australia). Thus, as in airline movement, a hub-and-spoke system may emerge, increasing the costs of cargo at the end of the spoke.

The hub sys tem, led by pr ior cumula t ive inves tmen t and mod- ernization of port facilities and con- necting land routes, is a barrier to entry for competing ports, and an instrument to concentrate cargo hand- ling in a handful of places. Thus, Los Angeles-Long Beach has superseded most West Coast US and Canadian ports, steadily increasing its share of the very rapidly growing Asia-Pacific trade. Indeed, much Mexican cargo is now shipped north to Houston and thence to Los Angeles to avoid the high-cost bottleneck of Mexican ports. Rotterdam has had a comparable role in marginal iz ing compet ing north European ports - it now handles more German cargo than all German ports combined.

Port and inland connecting trans- port systems can severely damage a country's export capacity (and the cost

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of receiving imported inputs into ex- ports), turning a significant compara- tive advantage from positive to nega- tive - Latin American ports, for exam- ple, are said to take eight days to unload cargo that takes two days in Europe. Brazil's average soyabean production costs are put at 16% below those of the USA; but the shiploaded total cost is 7% more. Transport costs for grain exports from Argentina and the USA are roughly the same - 15% of the CIF value of the cargo - but the average distance moved by grain ship- ments in Argentina is 250 kilometres, compared to the USA where it is 2 000 kilometres. The differences may be exaggerated because developing coun- tries often rely on high-cost land vehi- cles rather than water and rail move- ment (and often do so because the mismanagement of the alternative sys- tems nullifies what ought to be their cost advantage, making them higher cost than trucks). Thus, port or city congestion is not just an irritation to the traveller; it can effectively elimin- ate or reverse any economic advan- tage of the national economy.

Reducing costs through a more effi- cient management of the transfer from one mode of transport to another has always been a key preoccupation of transport planners, but it is now - as we discuss later below - the basis for the redesign of multi-modal junctions. Other ports have developed major storage capacity (contrary to the prin- ciple of JIT stock policies) to release goods in small batches from large ship cargoes. Antwerp has developed a major facility to transship cargo from ships to Rhine barges, and even to carry in ships goods in complete barge-containers that can then be re- leased in inland waterways without much handling. Rotterdam has de- veloped even more extensive facilities to link its 31 000 sea-going ship move- ments and 120 000 inland vessels. Such transshipment and storage facili- ties are impossible to emulate in old port areas.

A i r p o r t s

Air cargo is particularly important for the fast and reliable deliveries associ- ated with JIT stock policies and 'lean'

manufacturing systems. This has been one factor in the high rate of growth in air freight movements in the 1980s (with 96% increase in the world volume of air cargo - from 29 to 58 billion tonnes, and a projected 140 billion by the year 2000) (OECD, 1993). In the USA, one third of cargo - by value - is currently moved by air, and as the average weight of goods declines in order to reduce the energy costs of movement, this share is likely to grow (the International Civil Avia- tion Organisation estimates that for each 1% increase in the real value of world exports, there is an increase of 1.5% in the demand for air cargo). F u r t h e r m o r e , in the 1990s and beyond, it is likely that there will be disproportionate growth in developing countries (where air freight is relative- ly undeveloped). Innovations in air freight (in the average size of freigh- ters, in handling facilities and the speed of movement) may sharply re- duce the economic disadvantages of distance. One - no doubt rash - esti- mate has it that by the year 2010, US exporters will be no more than three hours flying time from any part of the world (Kasarda, 1991), giving speedy and cheap access to all markets simul- taneously.

The competition to secure hub roles in both passenger and freight move- ments has become fierce. In East Asia, new airports in Seoul, Hong Kong and Osaka (Kansai) are vying with old established hubs in Bangkok and Singapore (Kajimoto, 1992; Ren- nie, 1992). In North America, Denver has formulated a plan for an airport with some 12 runways and 250 gates (Elliott, 1991), a project matched in other areas in the development of freight facilities. In Europe, competi- tion between airport cities is also fierce.

However, for distances up to 400 kilometres, the development of high- speed rail services is increasingly com- petitive - where the total door-to-door trip time is equal in both modes, air and rail. In the USA, it has been estimated that some 400 million air passengers could be transferred to rail routes in areas of dense movement; a TGV line is under construction to link Houston, Dallas and San Antonio,

and other schemes have been discus- sed for the San Francisco-Los Angeles and Boston-Washington routes. Rail has a particular advantage because the terminals are usually located in the heart of the city, reducing the time to reach the train in comparison to out- of-town airports. Furthermore, rail terminals can handle a much larger volume of movement in a small space - Chicago's O'Hare airport, reputedly the world's largest in terms of passen- ger movement, handles some 60 mil- lion travellers annually, compared to Paris's rail Gare St Lazaire, which handles 150 million in a fraction of the space. High-speed trains to city cen- tres have thus the opportunity to give dramatic savings in JIT stock policies, and to do so in competition with air movements.

Airports are - as seaports used to be - not only significant direct employers (London's Heathrow employs 54 000 workers directly) but also important indirect generators of other economic activity, particularly that related to air transport (from aircraft servicing, warehousing, some manufac ture , tourism, etc). The location of some airports in Central America has reorganized the pattern of local cul- tivation to meet the demand for cut flower exports. For short haul travel in Europe, engineering parts are now increasingly moved by air and the airport may in time become a factor in factory location. Increasingly, this is affecting heavier goods - General Motors is said to fly Alcante vehicle frames from Detroit to Turin for part processing then returning'them by air for final fitting.

As with seaports, land connections are a key factor for airports both for freight and passenger movement. On short haul flights, getting to and from the airport can take 60% of the total door-to-door travel times; and even up to a third for trips of more than 1 000 kilometres. Thus, for example, for Bombay's international airport, handling half the international passen- ger flow of India as well as a major part of the international freight, access to the city and to the mainland be- come key factors in the full exploita- tion of India's comparative advan- tages.

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Multimodal facilities

The emerging logic of the transport system has long promised the integra- tion of modes to minimize junction costs, and a number of schemes have been mentioned above. Essentially, the transport agent now promises door-to-door movement, selecting the means of transport according to availability, cost and timing, and sub- stituting different modes according to changing needs while goods are in transit. An unexpected increase in de- mand (with minimum stock carrying) may lead to goods being transferred from sea to air en route; a sudden interruption in one service can lead to swift transfer to another. In a different form, cargo may be containerized in the mode of transport i t se l f - as with Rhine barges. Trucks play a similar part in roll-on roll-off ships. Inte- grated sea-land routes are designed to minimize delays, as with the sea-rail- sea route from Western Europe to Japan via St Petersburg and Vladivos- tok. There are also attempts to design multi-model junctions. This can be seen in Rotterdam's Sea-Land Service and European Combined Terminal. In some cases, the links are also with manufacturing. The Runcorn- Warrington Science Park near Man- chester is a small - and now old - example of this, linked to both Man- chester airport and north-south and east-west motorways, and to the Man- chester University Institute of Science and Technology. Very much more ambitious combinations of manufac- turing, air freight terminals and freight airports can be seen in the Perot Alliance Airport industrial complex next to Dallas-Fort Worth airport and at the Stewart Industrial Complex in up state New York. There are two other examples of interest which are still being developed:

Barcelona. In the 1980s, city author- ities undertook a series of initiatives very loosely associated with the city's bid to hold the Olympic Games:

(1) The upgrading and expansion of the old port to make it a leading container facility on the Mediterranean: capacity was ex- panded from 180 000 TEUs (20-

foot container equivalent) to 448 000; a new terminal is under construction to increase this to 700 000.

(2) The port was also linked to an expanded and upgraded airport, to the north-south and east-west motorway system.

(3) It was also linked to the terminal for a proposed TGV high-speed rail link to Paris, planned to be opened in 2004. This line is sup- posed to reduce the journey time to Paris to four and a half hours. The Channel Tunnel will similarly reduce the journey time to Paris from Birmingham to about the same time; and a proposed high- speed link to Warsaw will again reduce travel time to about four and a half hours. Barcelona rail freight is projected to increase from 2.8 to 4 million tonnes by 2010.

The proposed aim for this complex is to capture part of the East Asia- Rotterdam container trade by offering swift and cheap reshipment facilities from sea to rail or road (and in some cases to air) for distribution to Europe's main markets. Further south from Barcelona, a comparable project is linked to a business park designed for air freight handling manufacture, distribution and storage, air courier offices, etc.

North Carolina. The Global Air In- dustrial Complex I has been designed to minimize the movement costs for JIT manufacturing. Plants are to be located by the aircraft taxiways, with direct unloading to the factory at one end of the aircraft and loading at the other. Warehousing facilities are also provided, and a 24-hour global supply system for components, with other air-transport related facilities. The checking and inspection of cargo (through US Customs, etc) are to be rationalized and electronically moni-

1See Kasarda (1991), and Kenan Institute of Private Enterprise (University of North Carolina - Chapel Hill), Global Trans Park: A Global Air Cargo-Industrial Com- plex for the State of North Carolina, Glob- al Air Commerce Corporation, Chapel Hill, 1992.

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tored to minimize transshipment costs. The complex is located with easy access to the freeway system.

Problems

Some of the problems of the changes taking place in freight movement have already been indicated - for example, the social costs of the containerization and relocation of dock facilities, the priority to be attached to the manage- ment of road and rail supply systems if modern technology at the terminals is to be fully exploited, etc. However, the sheer scale of the growth of sea and air cargo movements, not to men- tion the vast expansion expected in air passenger movement (as developing countries begin to catch up with de- veloped countries in terms of mass tourism), imposes special problems. Disproportionate increases in move- ment imply a high rate of growth of energy consumption, and thus the pro- duction of toxic and other wastes. Hitherto, much of this has been dumped in watercourses or in the sea at cumulatively heavy cost in terms of fishing, vegetation and precisely those facilities that attract tourists. The dumping of ship wastes in the North Sea, and particularly at the entrance of the Rhine, indicates the scale of possible danger. Control mechanisms are weak, particularly at sea, yet un- less they are swiftly improved and incentives directed at increasing eco- nomy in the use of energy, the scale of economic development required if, for example, India's labour force is to be fully employed will prove impossible to achieve. The central issue is less the installation of new monitoring facili- ties (that may also be needed) and more the establishment of an effective regulatory regime, a system of man- agement which can simultaneously facilitate economic expansion, rapid movement and a reduction in threats to the environment.

Conclusions

An open world economy is character- ized, from the viewpoint of one city, by much more unpredictability of de- mand for the output of goods and services of the city. The whole emph-

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asis in planning therefore is forced away from the mandatory regime of fixed norms towards much greater fle- xibility and the much vaguer 'scenar- ios'. Simultaneously, the reduction of safety margins in much of manufactur- ing and services puts a preminum on reliability and reduced time of supply. Thus, the aim becomes simultaneously much greater precision and greater flexibility in the production system. The economic future of the city, the e m p l o y m e n t and incomes of its citizens, accordingly comes to be much more closely related to the ease, cheapness and reliability of flows of goods and services to and from the rest of the world. Cities with the capacity to invest in the infrastructure of movement, sea, air and road thus enormously strengthen their competi- tive capacity and build barriers to the entry of competing cities. The com- petitive advantages here, however, depend upon the capacity of urban authorities to manage the internal movement of the city, the flows to and

from the terminals that connect with the world at large.

References

Balassa, Bela (1991) Trends in Developing Country Exports, 1963-88, Policy, Re- search and External Affairs (Develop- ment Economics), WPS 634, World Bank, Washington DC

Dolman, Antony J and Ettinger, Jan van (1992) (eds) Ports as Nodal Points in a Global Transport System, Pacem in Maribus XVIII, International Ocean Institute, Pergamon Press Oxford

Elliot, Donald L (1991) "Denver new air- port development and related Gateway/ Stapleton urban development projects', in Denver International Airport: Prog- ress Report, 1 Denver

Harris, Nigel (1991) Urbanization, Econo- mic Development and Policy in De- veloping Countries, DPU Working Pap- er No 19, Development Planning Unit, University College London, London, January 1990; republished in Harris, Nigel (1991) City, Class and Trade: Social and Economic Change in the Third World, DPU and IB Tauris, Lon- don, 12-64

Kajimoto, Norihiko (1992) Projects" related

to Kansai International Airport, Paper for the International Conference on Urban Development Policies and Pro- jects, Nagoya, 1991 (City of Nagoya, United Nations Center for Regional Development and the Nagoya Center for Urban Advancement)

Kasarda, John D (1991) 'Global air cargo- industrial complexes as development tools', Economic Development Quarter- ly, 5(3) 187-196

Kenan Institute of Private Enterprise (1992) Global Trans Park: A Global Air Cargo-Industrial Complex for the State o f North Carolina, Global Air Commerce Corporation, University of North Carolina, Chapel Hill

OECD (1993) International Air Transport: The Challenges Ahead, OECD, Paris

Peters, Hans (1989) Seatrade, Logistics and Transport, Infrastructure and Urban Development Department, Policy and Research Series 6, World Bank, Washington DC

Rennie, W I A (1992) Redevelopment Im- pact o f Hong Kong's Metroplan and Port and Airport Development Strategy, Paper for the International Conference on Urban Development Policies and Projects, Nagoya, 1992 (City of Nagoya, United Nations Center for Re- gional Development and the Nagoya Center for Urban Advancement)

336 Cities 1994 Volume 11 Number 5