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Economic Evaluation of Port Deepening Projects

Economic Evaluation of Port Deepening Projects


ABSTRACT


T he master plan for each port sets the longterm development strategy for the port which will influence the future levels of traffic that use it.These developments may be either improving existing facilities or building new ones. Any other kind of activities that are performed to increase the intensity of port use canal so be considered a sport development. These can be in the field of law or reorganization too. In any way, an economic evaluation of port development investment should be considered before any action is taken. This isa decision making process where profit ability of the new investment is questioned. The evaluation for such a port development project require a succession of costs and benefits over the whole useful life of the project. The main costs in a port development project are construction costs and maintenance costs, the benefits are mainly transport cost savings and reduced turn-round time. A fundamental characteristics of these costs and benefits are that they are transmitted to other participants in the trader at her than to the port authority.The matter of getting costs and revenues on a basis where they may be equitably and conveniently compared can be done by several investment appraisal methods. In this paper, evaluation of a port deepening project will be discussed by using benefit-cost methods.The costs and benefits of such a project will be identified by showing how the port depth affects the unit price of transportation cost.