A new agreement between the Georgia Ports Authority and the Shanghai International Port Group is expected to increase trade between the Southeast and China, according to Jeff Neil, manager of market research and development, and Tom Swinson, sales support and market manager, both at the authority.

A memorandum of understanding that was signed by Georgia and Shanghai port officials promotes all-water shipping routes between Asia and the port of Savannah. The agreement calls for the exchange of information and expertise in the areas of marketing, operations and information technology between the two ports.

“Shanghai is a much larger port than Savannah, so we will learn about their technology and management, but more importantly, they know their markets, their hinterland, so even if we’re more sophisticated technologically, we can’t possibly know how to get into hinterland as well as they,” Mr. Neil told GlobalAtlanta.

“It’s not necessarily a question of technology, but more about obtaining information on how to penetrate the Chinese market better to create further channels for Georgia exports. The most important facet of this new agreement is to promote greater trade for both markets,” Mr. Swinson added.

The new cooperative agreement will allow Shanghai and Georgia to engage in staff exchanges for collaboration on new port technology projects, including security measures and efficiency plans.

The main advantage for Georgia business of the agreement is the insight to be gained about Chinese markets, Mr. Neil said. He added that Chinese are increasingly wanting American goods, and they are starting to look at finished products, not just natural resources, from Georgia and the rest of the United States.

“China’s demand is driving prices on the world market. They’ve become a huge importer,” Mr. Swinson said.

The port of Savannah has been successful in sending containers full of U.S-made goods to Shanghai after shipments arrive in those containers from China, Mr. Neil said. Georgia products exported to Shanghai, including kaolin clay, forest products and poultry, have increased by more than 30 percent over the past year, and finished goods exports are increasing as well, according to the ports officials.

Many container ships coming from Shanghai are feeding the large retail distribution centers near Savannah, including Wal-Mart Corp., and, soon, Target Corp., which recently announced it is building a distribution center near the port.

While freight forwarders in Europe and carriers in Latin America are the decision-makers for which ports to use for importing and exporting goods, large retailers typically sway those decisions in the U.S., Mr. Neil noted.

“A key ingredient to our steady growth in the Asian market is directly tied to our excellent partnership with America’s major retailers like Target,” Mr. Swinson said. “They are not sourcing only from China, but from all over the world. Savannah is a gateway to offer access to sourcing locations around the globe.”

But more than 40 percent of the Georgia Ports Authority’s total business is coming from China, Mr. Neil added. Georgia Ports Authority’s exports to Shanghai Port in 2004 totaled 59,028 twenty-foot equivalent units.

The Port of Savannah has 16 all-water Asia-U.S. East Coast services, 14 of which are routed through the Panama Canal and two via the Suez Canal. Savannah is the fifth largest container port in the U.S.

Mr. Neil and Mr. Swinson agreed that while the ports authority has an agent in Shanghai that promotes Southeast Asia business with the port of Savannah, a new Georgia trade office in China would help to generate even more business for the port.

Contact Robert Morris at the Georgia Ports Authority at (912) 964-3855 or rmorris@gaports.com or visit www.gaports.com for more information.