Globalization and Trade Theory: Strategic Analysis of Rotterdam Port

This report provides an in-depth analysis of the Port of Rotterdam, examining its historical evolution, comparative and competitive advantages, and operational challenges within the context of globalization and international trade theory. The report highlights the port's strategic position in the Hamburg-Le Havre range, its revenue stability, and its efforts to diversify its market in response to challenges such as new agreements on oil export and the use of conventional transport modes. It also discusses the business strategies employed by the Port of Rotterdam, including expanding the existing market, adapting to bio-based and offshore markets, and modernizing the existing framework. The report concludes by exploring future business prospects, such as expanding into bio products and establishing new trading routes, emphasizing the importance of adapting to long-term opportunities and maintaining a close connection with the hinterland.

Running Head: GLOBALIZATION AND INTERNATIONAL TRADE THEORY
GLOBALIZATION AND INTERNATIONAL TRADE THEORY
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Table of Contents
Executive summary.........................................................................................................................2
Methodology....................................................................................................................................2
Introduction......................................................................................................................................2
Historical evaluation....................................................................................................................3
Comparative and competitive advantage.....................................................................................4
Operational challenges.................................................................................................................5
New agreement on oil export...................................................................................................5
Use of rail and barge for transport...........................................................................................5
Business strategies.......................................................................................................................6
Future business prospects............................................................................................................7
Reference.........................................................................................................................................8
Appendix........................................................................................................................................10
Appendix 1.................................................................................................................................10
Appendix 2.................................................................................................................................10
Appendix 3.................................................................................................................................11
Appendix 4.................................................................................................................................11

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Executive summary
Port of Rotterdam is considered to be one of the busiest and largest port in Europe and
also across the world. However, there are some challenges that the port is suffering with in
terms of environmental conventions and cargo transport issues. Based on this the purpose of
this report is to figure out the possibilities and opportunities that can foster better strategic
advantage for Port of Rotterdam to compete in the global market. In fact, the report also
discusses the existing framework and business strategy that the port authority follows.
Methodology
In order to make an in-depth analysis, the report seeks help of the secondary sources like
the official website of the Port of Rotterdam and some online journals and articles. Most of
those articles are taken from Google scholar. Moreover, there are some online articles from
authentic and peer reviewed used for this research.
Introduction
Port of Rotterdam is the largest port in Europe that is located in the City of Rotterdam,
Netherlands. Until 2004 the Rotterdam Port was considered to be the busiest port in the
world with a massive annual cargo tonnage (portofrotterdam.com 2018). It can be argued that
due to the presence of such a huge port the city of Rotterdam becomes a popular and hub of
industrial activities profoundly (Frantzeskaki, Wittmayer and Loorbach 2014). From that
perspective the city of Rotterdam is considered to have immense importance. In this regard,
the purpose of this report is to undertake a thorough research on different aspects of the Port

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City of Rotterdam. In response to this, the historical evaluation and the comparative and
competitive advantages are incorporated into the discussion. Moreover, the report also
discusses the business strategies that the Port of Rotterdam follows and also highlights the
future business prospect of the port.
Historical evaluation
Rotterdam is identified as one of the major European port and the second largest city of
the Netherlands. Located in the North Sea. The name of Rotterdam was first mentioned in
1283 as a small tract of land that was created by draining the mouth of the Rotte River.
However, the region was developed as a fishing village within 1328 (Huang-Lachmann and
Lovett 2016). By the year 1340 it became the major port in the province. This was the start of
Rotterdam Port to get a significant place in the history of Netherlands. During the
enlightenment period and development of modern science in the 17th century, the port got
enormous impetus to explore and discover new regions and became a trading hub to Dutch
Commerce (Zhang and Pel 2016).
During the French occupation in 1795 to the fall of Napoleon in 1815 most of the trade of
the port had been disbanded. In response to this, the transit trade had taken place and increase
the importance of the Rotterdam Port once again (Vos et al. 2015). However, during the
World War II the Rotterdam city was demolished and devastated with its port by the
Germans. As a result of that a new layout of the city with brand new planning for the
renovation of the Rotterdam Port (van der Lugt, Rodrigues and Van den Berg 2014).

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Comparative and competitive advantage
As per the mission and vision statement of the Port of Rotterdam is concerned, it can be
stated that the Port of Rotterdam authority is an autonomous company with the aims to
create economic and social value by working with the customers and the stakeholders in
order to attain sustainability. In this context, the logistic chains, networks and clusters both
in Europe and worldwide are important and have to be more effective and efficient.
From the geo-economic perspective, the Port of Rotterdam has a strategic position in the
Hamburg-Le Havre range. As a result of that the port has unconstrained access from the sea.
In addition to this, the unchallenged access of the European inland waterway make a better
environment for the Port of Rotterdam to maintain both inland and international market
very exquisitely (Wiegmans and Dekker 2016). As a matter of fact, the location advantage
also helps Port of Rotterdam to make better investment decision and contains all types of
cargo because of its huge space. As far as the report of the Port of Rotterdam authority, it
can be seen that the overall activity upload of the port is 2.2% down on the first half of the
2017 (portofrotterdam.com 2018). However, there are astonishingly increase in the
container with a rate of 5.9%. As a matter of fact, the Port of Rotterdam achieved a
throughput of 232.8 million tonnes in the first half of the annual year of 2018. As a result of
that in compare to the other ports in the Hamburg-Le Havre range Rotterdam has succeeded
to increase its business up to 0.3% in compare to the previous year where the growth rate
was 30.9% (Bosman et al.2018). From the context of the financial position of the Port of
Rotterdam, it can be asserted that the revenue of the port was stable in the first half of the
2018 with a worth of € 126.1 million.

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Operational challenges
Despite of having a number of opportunities and prospect for the Port of Rotterdam,
there are still some problems that can be identified in the light of the operational aspect.
New agreement on oil export
The new agreement on the extraction of fossil fuel is considered to be an important aspect
for the operational activity of Port of Rotterdam. The port is one of the major oil port in the
European region and most of its revenue is generated through the export of crude oil and
fossil fuel. Rotterdam is a hub of petrochemical sector and there are many petrochemical
plants which run oil products (Super et al. 2017). As a result it becomes a grave problem for
the Port of Rotterdam to maintain its operation with oil as a major exporting products. As a
matter of fact, the international forum put a stern regulation on the extraction of the fossil
fuel from the seabed. It is also put obstacle for the operation of Port of Rotterdam as the
port authority realises the need for an alternative.
Use of rail and barge for transport
Another major challenge that the Port of Rotterdam is facing is related to the use
conventional mode of rail and barge for the transportation of shipping containers. There are
lots of advantages of using such conventional measure in terms of the volume of
transportation. Massive load of cargo leads to the slowdown the transportation. As a result of
that it causes a huge problem for the Port of Rotterdam in its operation. Moreover, those
container trains are handled at Rail Service Centres (RSC) at Maasvlakte (Xiao et al. 2015).
It requires some space inside the port for uploading the cargos and it has to be used by the
train authority without any intervention from the port authority. This is considered to be a

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great problem because of huge paperwork to be done. Moreover, the process needs a fruitful
meeting between the stakeholders.
Business strategies
In case of understanding the business strategy of Port of Rotterdam it is essential to
figure out the different business activities that the port is practised. In fact, those business
strategies are provided some competitive advantage for Port of Rotterdam to retain its
business effectively in the European market. Both the sustainability and good relationship
with the customers and stakeholders are contributed effectively in setting up a better
business strategy for the Port of Rotterdam. Therefore, the Port of Rotterdam authority puts
emphasis on some priorities like emphasising on expanding the existing market with a better
penetration strategy (portofrotterdam.com 2018). As a matte o fact, due to the issues
regarding oil extraction and export the port authority now tries to diversify its market with
the adaption of entering the bio-based and offshore markets. Moreover, keep a track on the
maintenance of the energy, transport and utilities are also important for the Port of
Rotterdam. It requires huge investment in order to enhance the efficacy of the maritime,
inter-terminal and the hinterland transport (Merk and Notteboom 2013). Close connection
with the hinterland is also of paramount importance and the Port of Rotterdam authority has
to keep that on check. Modernising the existing framework with a creative space for
innovation is also incorporated into the strategy of Port of Rotterdam.
Future business prospects
It is important for the Port of Rotterdam authority to expand its market more extensively
so that the port can use the bio products as one of the major contributor to the export
business. It is associated with find out new trading routes in order to increase the volume of

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goods. In this regard, the European Union TEN-T Waterprojects on the Danube River was
initiated and expects to be completed around 2020.
There is huge opportunity for the Port of Rotterdam to increase its cargo ships and
outstretched the inland market more intensively. It requires the intervention of the import of
large container vessels with a volume of 10,000 to 12,500 TEUs. It will bring more
advantage of the port to set up its
Moreover, for a long-term opportunity Opening the Northern Sea Passage for up to 3 months
will be effective. In fact, using the Behring Straits tunnel for easy transportation will
facilitate to reach the market in Russian Federation in one hand and Alaska and North
America on the other.

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Reference
Bosman, R., Loorbach, D., Rotmans, J. and van Raak, R., 2018. Carbon Lock-Out: Leading
the Fossil Port of Rotterdam into Transition. Sustainability, 10(7), p.2558.
Frantzeskaki, N., Wittmayer, J. and Loorbach, D., 2014. The role of partnerships in
‘realising’urban sustainability in Rotterdam's City Ports Area, The Netherlands. Journal of
Cleaner Production, 65, pp.406-417.
Huang-Lachmann, J.T. and Lovett, J.C., 2016. How cities prepare for climate change:
Comparing Hamburg and Rotterdam. Cities, 54, pp.36-44.
Merk, O. and Notteboom, T. (2013). The Competitiveness of Global Port-Cities: The Case of
Rotterdam/Amsterdam – the Netherlands. [online] oecd-ilibrary.org. Available at:
https://www.oecd-ilibrary.org/docserver/5k46pghnvdvj-en.pdf?
expires=1543466455&id=id&accname=guest&checksum=3EC593C7A711F6E335730D8D2
EA4DCD7 [Accessed 29 Nov. 2018].
portofrotterdam.com 2018. Mission, vision and strategy. [online] Port of Rotterdam.
Available at: https://www.portofrotterdam.com/en/port-authority/about-the-port-authority/
organisation/mission-vision-and-strategy [Accessed 29 Nov. 2018].
portofrotterdam.com 2018. Sustained growth in container throughput did not fully offset
declining throughput in other sectors. [online] Port of Rotterdam. Available at:
https://www.portofrotterdam.com/en/news-and-press-releases/sustained-growth-in-container-
throughput-did-not-fully-offset-declining [Accessed 29 Nov. 2018].

9GLOBALIZATION AND INTERNATIONAL TRADE THEORY
Super, I., van der Gon, H.D., Visschedijk, A.J.H., Moerman, M.M., Chen, H., Van der
Molen, M.K. and Peters, W., 2017. Interpreting continuous in-situ observations of carbon
dioxide and carbon monoxide in the urban port area of Rotterdam. Atmospheric Pollution
Research, 8(1), pp.174-187.
van der Lugt, L.M., Rodrigues, S.B. and Van den Berg, R., 2014. Co-evolution of the
strategic reorientation of port actors: insights from the Port of Rotterdam and the Port of
Barcelona. Journal of Transport Geography, 41, pp.197-209.
Vos, Peter C., Frans PM Bunnik, Kim M. Cohen, and Holger Cremer. "A staged geogenetic
approach to underwater archaeological prospection in the Port of Rotterdam (Yangtzehaven,
Maasvlakte, The Netherlands): A geological and palaeoenvironmental case study for local
mapping of Mesolithic lowland landscapes." Quaternary International 367 (2015): 4-31.
Wiegmans, B. and Dekker, S., 2016. Benchmarking deep-sea port performance in the
Hamburg-Le Havre range. Benchmarking: An International Journal, 23(1), pp.96-112.
Xiao, F., Ligteringen, H., Van Gulijk, C. and Ale, B., 2015. Comparison study on AIS data of
ship traffic behavior. Ocean Engineering, 95, pp.84-93.
Zhang, M. and Pel, A.J., 2016. Synchromodal hinterland freight transport: Model study for
the port of Rotterdam. Journal of Transport Geography, 52, pp.1-10.

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Appendix
Appendix 1
Image 1: Port of Rotterdam
(portofrotterdam.com 2018)
Appendix 2
Image 2: Development of Port of Rotterdam

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(portofrotterdam.com 2018)
Appendix 3
Image 3: Offshore port of Rotterdam
(portofrotterdam.com 2018)
Appendix 4
Image 4: Inland transport route of Rotterdam port