Launch of Taiwan International Ports Corp (TIPC)

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whose harbor bureaus performed both administrative and business roles.

Regulations as well as a new Statute for the Act of the Establishment of the State-run Ports Corporation.

and harbor affairs and Harbor Bureaus have been transformed into Port Corps dedicated to port operations.

1 April 2012 No.51 Gateway To Asia-pacific Trade Network Launch of Taiwan International Ports Corp (TIPC) Previously, the Ministry of Transportation and Communications (MOTC) governed four international seaports, whose harbor bureaus performed both administrative and business roles. In order to increase the ports operational flexibility and promote port competitiveness, the MOTC carried out its port reform in accordance with an amendment to the Commercial Port Law, and relevant Regulations as well as a new Statute for the Act of the Establishment of the State-run Ports Corporation. Under the reform guide, and in line with the separation of administrative and business authorities in other advanced countries, the Maritime and Port Bureau has jurisdiction over shipping, navigation and harbor affairs and Harbor Bureaus have been transformed into Port Corps dedicated to port operations. The four branches of TIPC comprise the Ports of Keelung, Taichung, Kaohsiung, Haulien and three commercial auxiliary ports. Each of the seven harbors will be assigned a specific role, subject to its particular strengths. Collectively, they will form a Port Group better prepared to maximize their competitive advantage. Director-General Hsiao Ding-hsun of the Kaohsiung Harbor Bureau was appointed as the chairman of TIPC, and Director Li Tai-Hsin of Taichung Harbor Bureau as its President. As for the Port of Kaohsiung, Deputy Director-General Huang Kuo-Ying of the Kaohsiung Harbor Bureau was appointed as the Port s president. Both TIPC and the Maritime and Port Bureau were established and licensed on March1, In future, TIPC will be engaged in diversified business operations, including port operations, Free Trade Zone business management, and investment in related transportation businesses. In pursuit of its Double V (value and volume) goal, Kaohsiung Port, with its well-developed Free Trade Zone, will act as a locomotive for economic growth and, when necessary, outsource reprocessing to both the Nantzi and Kaohsiung Export Processing Zones to create greater added value. Keelung Harbor, for its part, will focus on cross-strait direct shipping and the international cruise business. Taichung Port is better suited as a center for traditional industries and logistics. Finally, Hualien Port will cater to the demands of tourist excursions and stone and masonry supply. It is hoped, once the resources of the four ports have been integrated, to implement a philosophy of internal coordination and external competition. Importantly, TIPC will also strive to form strategic partnerships with bonded ports in China, SouthEast Asia, and North-East Asia.

Kaohsiung Port signs Sister Port Agreement with Port of Miami ed to boost cruise tourism and enhance Kaohsiung s reputation as a gateway to the sea.

The Kaohsiung Harbor Bureau (KHB) signed a sister port agreement with the Port of Miami on Feb.17, 2012.

2 Kaohsiung Port signs Sister Port Agreement with Port of Miami ed to boost cruise tourism and enhance Kaohsiung s reputation as a gateway to the sea. In this respect, the Port of Miami, with annual arrivals in excess of four million tourists, has much to teach the Port of Kaohsiung in how to become a high-quality cruise terminus. The Kaohsiung Harbor Bureau (KHB) signed a sister port agreement with the Port of Miami on Feb.17, The agreement was signed by Chief Secretary Chung of KHB and Director Bill Johnson of Miami Port, and witnessed by Mayor Gimenes of Miami-Dade County, Mayor Regalado of Miami City, Mayor Cheng of Kaohsiung City, and Director Mou of the Taipei Economic and Cultural Office in Miami. Both ports expect to reap the benefits of mutual co-operation in a wide variety of areas, including port construction, development, harbor management, information technology and staff. Details of the agreement include: 1. The free and unlimited exchange of information on port goods, the cruise industry, port infrastructure, and historic data obtained through market research. 2. Educational training and mutual visits to promote technology and finance. 3. Formal recognition and promotion of ties to strengthen business confidence in the two ports. Commodity volume throughput at the Port of Kaohsiung in 2011 exceeded 130 million tons, and container volume reached 9.6 million TEU. To accommodate larger-scale vessels (including the newest 12,500TEU ships) and the steady consolidation of shipping lines, the Port of Kaohsiung is currently carrying out extensive dredging and construction work. In addition, and in collaboration with Kaohsiung City, a brandnew Port and Cruise Service Center is being construct1 Though there are significant differences between the Ports of Kaohsiung and Miami, both ports are at a similar latitude and experience similar climatic conditions. And they both play significant roles in their respective country s national economic development. Mayor Chen, leading a city delegation to inspect Miami s justly famous cruise and tourism industry recently, expressed her congratulations and declared that Kaohsiung City would be the first city in Taiwan to initiate a Cruise and Passenger Industry Promotion Committee to promote Kaohsiung tourism and seek cooperation with other cruise ship destinations in Asia. The Port of Miami is the fifteenth sister port of the Port of Kaohsiung. The fourteen other sister ports are : the Port of San Diego in the US, the Port of Baltimore in the US, the Port of Houston in the US, the Port of Tacoma in the US, the Port of Philadelphia in the US, the Port of Felixstowe in the U.K, the Port of Le Havre in France, the Port of Bilbao in Spain, the Port of Venice in Italy, the Port of Vancouver in Canada, the Port of Hamburg in Germany, the Port of Dubai in the United Arab Emirates, the Port of Vladivostok in Russia, and the Port of Dairen in China.

The Kaohsiung Intercontinental Container Terminal The second phase of the Kaohsiung Intercontinental Container Terminal (KICT) is a massive land reclamation project conducted by the Kaohsiung Harbor

3 The Kaohsiung Intercontinental Container Terminal The second phase of the Kaohsiung Intercontinental Container Terminal (KICT) is a massive land reclamation project conducted by the Kaohsiung Harbor Bureau (KHB). The planned hectare reclamation south of the Second Harbor Entrance will boast 19 deep-water wharves, five of which will be the latest wharves capable of accommodating 18,000 TEU container ships. Annual container capacity at the facility will be up to 4 million TEU. In addition, ten new petrochemical wharves will be the basis of a new distribution center for petrochemical products. Four other, general-cargo wharves, will supplant those currently in use in Chungtao Commercial Port. The anticipated time-span for construction will run from 2011 to 2019, at a total cost of NT$90.6 billion. Of this, the government will be responsible for NT$28.11 billion, and NT$62.49 billion will come from private investment. Completion of the project will allow the Port of Kaohsiung to develop waterfront recreation space and re-invigorate the use of land resources at the port, which in turn will trigger innovation within the greater City-Port region. As part of KICT Phase Two, new dikes and a breakwater are currently under construction. Tenders were opened on Feb.7, 2012, and the contract was awarded to BES Engineering Corporation for NT$8.755 billion. Construction commenced in March, 2012, and will be completed by early Caisson construction (total length 6,615 meters) will provide safe coverage for subsequent dike construction and dredging work. 2

Kaoming Container Terminal Corporation has passed an on-thespot inspection carried out by the Kaohsiung Customs Office, and is now an Authorized Economic Operator (AEO).

4 Kaoming receives AEO Certification Yan was assigned as chairman of an AEO promotion committee to organize specialists in every department. After a sustained four-month effort, Kaoming has met the rigorous standards of AEO and passed an on-the-spot inspection verified by the Kaohsiung Customs Office. Kaoming Container Terminal Corporation has passed an on-thespot inspection carried out by the Kaohsiung Customs Office, and is now an Authorized Economic Operator (AEO). Kaoming is the first container stevedoring company to receive an AEO certificate in the Port of Kaohsiung. In order to upgrade its service quality and satisfy international supply-chain criteria and AEO verification, Kaoming s manager Xue introduced an AEO training course to the company. Vice Manager 3 Quite apart from the obvious benefits of improved competitiveness, and a better company image, all subsidiaries of those operators who obtain AEO certification are also recognized as AEO operators. They are able to consolidate or break bulk cargoes directly in their transshipment warehouses after notifying Customs in advance. Kaoming Container Terminal Corporation, which began operating in Jan.2011, is a leader in professional and semi-automated wharf operations. On June 6, 2011, Kaoming was authorized to implement Autonomous Management by the Customs Dept. On Jan.5, 2012, Kaoming was granted ISO9001, ISO14001, OHSAS and TOSHMS certification. Kaoming is an outstanding stevedoring company with container-handling figures of 1,080,000 TEU in 2011; gantry cranes averaging 39 moves/ hour; and trailer truck turnaround every 13 minutes. Having earned AEO certification, Kaoming is certain to provide an even higher level of quality service to its customers.

COSCO PRIDE s maiden voyage New Year New Hope COSCO PRIDE made her maiden voyage to the Port of Kaohsiung on Jan.31, 2012, docking at Kaoming Container Wharf No.108.

5 COSCO PRIDE s maiden voyage New Year New Hope COSCO PRIDE made her maiden voyage to the Port of Kaohsiung on Jan.31, 2012, docking at Kaoming Container Wharf No.108. Director-General Hsiao of the Kaohsiung Harbor Bureau (KHB) presented a commemorative plaque in person to welcome her arrival. Belonging to COSCO Container Lines Co., Ltd, she is represented by Taiwan China Ocean Service Co., Ltd COSCO PRIDE has a total weight of 141,823 tons, a length of meters, a beam of 48.2 meters, a draft of 15.5 meters, and is capable of carrying 13,114 TEU. She is 66 meters in height and has approximately 1.7 hectares of deck space. While docked at Kaoming Wharf, container handling efficiency reached 150 moves/hour. The arrival of the COSCO PRIDE represented Kaoming s debut in accommodating a mega container ship. It allowed Kaoming Wharf which is equipped with the very latest semi-automated stevedoring system to fully demonstrate its ability to shorten operating times for shipping companies and provide a secure berthing service. During Chinese New Year, COSCO arranged for COSCO PRIDE, working the European Line (NE2), to visit the Port of Kaohsiung and adjust its shipping route. In future, three additional container vessels ( COSCO GLORY, COSCO HARMONY, COSCO DEVELOPMENT) will join the fixed route : Tianjin Dairen Qingdao Ningbo Kaohsiung Yantian Singapore Suez Canal Hamburg Felixstowe COSCO PRIDE is the largest vessel to ever call at the Port of Kaohsiung. Her visit was a timely reminder that the Port of Kaohsiung is more than capable of handling mega container ships in an expeditious manner. The four mega container vessels already confirmed as serving the fixed shipping routes to the Port of Kaohsiung in future will subtantially increase container volume. The ship has 19 tiers in total (nine above deck), accommodating 19 rows of containers. Captain Mr Malvinder Singh of COSCO PRIDE was both warm and generous in his praise of the Port of Kaohsiung and its outstanding service. 4

Cross Border Cargo Security On June 1, 2010, the RFID (Radio Frequency Identification System) Seal Monitoring System was introduced and has since proven effective in easing manpower demands for

6 Cross Border Cargo Security On June 1, 2010, the RFID (Radio Frequency Identification System) Seal Monitoring System was introduced and has since proven effective in easing manpower demands for escort operations. Due to its success, the Directorate General of Customs (DGOC) has decided to establish Cross Border Cargo Security in the ports of Keelung, Taipei, Taichung, and Kaohsiung before June, 2012, applying both active and passive RFID Seal Monitoring Systems to transit, transshipment and import/export containers. Prior to the expanded use of RFID, the Kaohsiung Customs Office (KCO) held a presentation seminar, presided over by the Deputy Director of KCO, Mr. Chung. Relevant authorities and members of the private sector were invited to participate in the seminar to discuss and share their views and experience. Deputy Chung of KCO noted that the favorable impact of RFID on container traffic and security has been recognized by all concerned. He made special mention of the fact that the system allows customs officers to match information on containers in the container yard (CY) with that received by checkpoints in the Port of Kaohsiung in real time. The system is also equipped with a 24-hour monitoring device that scans images to the customs office, enhancing container movement security and ensuring smoother information flow. All of this is in accordance with the WCOSAFE framework and global customs standards, thereby preserving Taiwan s reputation as a vital member of the world trading community. 5

KHB holds New Year Press Conference On Feb.7, 2012, the Kaohsiung Harbor Bureau held a New Year press conference at the Kaohsiung Ambassador Hotel.

This compared favorably with Singapore (4%), Hong Kong (3%), and Los Angeles (-0.1%). The growth rate for Shenzhen was also negative.

7 KHB holds New Year Press Conference On Feb.7, 2012, the Kaohsiung Harbor Bureau held a New Year press conference at the Kaohsiung Ambassador Hotel. During the conference, Director-General Hsiao noted that container throughput in Kaohsiung Port in 2011 had reached 9,630,000 TEU, an increase of nearly 5%. This compared favorably with Singapore (4%), Hong Kong (3%), and Los Angeles (-0.1%). The growth rate for Shenzhen was also negative. All in all, given the European KHB Provides Quick and debt crisis, oil price rises, and a skewed balance between Easy Tax Refund Service shipping supply and demand, 2011 was a gloomy year for the shipping industry, particularly long haul shipping lines. The Kaohsiung Harbor Bureau (KHB) has The Director-General was also keen to highlight the continuing transformation of the old port area in Kaohsiung Port into a bustling tourist area - Kaohsiung s Waterfront Pearl. Several other highlights were mentioned, including the leasing of old warehouses in the Chungtao Commercial Area to logistics firms; commencement of the bidding process for the second phase of construction of the Kaohsiung Intercontinental Container Terminal ; the transfer of Chienchen oil tanks to a newly-expanded area of the port, and land to the rear of Container Terminal No.2 to be set aside for logistics investment; more than 100 hectares of land in the Nansing Project Zone to be used to promote new energy sources; and pending authorization for a bonded warehouse area to store non-ferrous metals to be traded on the London Metal Exchange (LME). The completion of these projects will sharpen the competitive edge of the Port of Kaohsiung, and better equip it to confront the challenges that lay ahead. established an on-line tax refund program to provide quick and easy tax refunds for cruise passengers. The new service was launched on Feb.14, 2012, to coincide with the arrival of the Cruise Ship Nautica. Passengers no longer need to trek to the Passenger Service Center to claim their tax refunds. The M/V Nautica is represented by Wilhelmsen Ships Service Inc. and is registered in the Republic of the Marshall Islands. Built in 2000, she has a total weight of 30,277 GT, a length of 173 meters, and a beam of 26 meters. Belonging to Nautica Acquistition, LLC, she departed Hong Kong en route to Keelung, via Kaohsiung. The M/V Wan Hai 273 Calls at Kaohsiung Port A Singapore-registered vessel, the M/V Wan Hai 273, represented by Wan Hai Lines Ltd, made her first voyage to the Port of Kaohsiung on Feb.19, 2012, docking at Wharf No.80. She was completed in 2012 and is 16,776 GT in total weight, meters in length, 27.3 meters in beam, and 9.5 meters in draft. Her shipping service route is: Kaohsiung Taichung Keelung Osaka Mojiko Hakata Keelung Taichung Hong Kong Kaohsiung 6

First call at Kaohsiung Port for Nippon Maru The M/V Nippo Maru Cruise, belonging to Mitsuio.S.K Passenger Line and represented by Enghong Shipping Agency Co.

The M/V Nippo Maru, built in 1930, has a total weight of 22,472 TW, a length of 170 meters, and a beam of 24 meters. Departing from Japan, she called at Hualien, then Kaohsiung, and finally Keelung.

Therefore, in co-operation with the Taiwan government tourism promotion campaign, the Kaohsiung Harbor Bureau (KHB) has assiduously courted both cruise lines and shipping lines.

8 First call at Kaohsiung Port for Nippon Maru The M/V Nippo Maru Cruise, belonging to Mitsuio.S.K Passenger Line and represented by Enghong Shipping Agency Co.,Ltd, made her maiden voyage to the Port of Kaohsiung on Feb.1, 2012, docking at Wharf No. 3. Carrying 330 international tourists, she left Kaohsiung at 6:00 p.m. the same day. The M/V Nippo Maru, built in 1930, has a total weight of 22,472 TW, a length of 170 meters, and a beam of 24 meters. Departing from Japan, she called at Hualien, then Kaohsiung, and finally Keelung. Due to the global economic downturn, the number of cruises to Taiwan has recently dwindled. The 311 earthquake in Japan has also resulted in many fewer Japan-registered cruises to Taiwan. Therefore, in co-operation with the Taiwan government tourism promotion campaign, the Kaohsiung Harbor Bureau (KHB) has assiduously courted both cruise lines and shipping lines. As a result of these efforts, in addition to the arrival of the Nippon Maru at Kaohsiung, there will be a further 13 cruise ship arrivals in Kaohsiung in the coming months. In order to facilitate customs clearance procedures, KHB has prepared Wharf No.3 for use as a CIQS Area (customs, immigration, quarantine, security). Furthermore, those passenger amenities provided by the Kaohsiung Tourism Bureau have done much to create a favorable impression for tourists, especially the guest welcoming activities and translation service. In 2011, 15 international cruises visited Kaohsiung, carrying 24,315 passengers in total. Publisher : Hsiao, Ding-Hsun Editors-in-Chief : Su, Jiann-Rong Committee : Chen, Su-Man, Chen, Rong-Shin, Cheng, Shu-Hui, Liu, Soun-Laun, Su, Jiann-Rong Chinese Editor : Chen, Jong-Long English Editor : Lin, Shiu-Yueh English Consultants : Laurence Quinlivan, Patrick Quinlivan Design & Print : C.H Design (Tel : ) Port of Kaohsiung Taiwan International Ports Corporation, Ltd. No.62, Lin Hai 2nd Road, Kaohsiung Taiwan 80443, R.O.C Tel : Fax : Website :

Ongoing Investment in Port of Kaohsiung and Anping Harbor to promote competitiveness

April 2013 No.55 Gateway To Asia-pacific Trade Network Ongoing Investment in Port of Kaohsiung and Anping Harbor to promote competitiveness The Taiwan International Commercial Ports Development Plan, drafted