China gets tough on safety at Tianjin port

IHS 8-10-2015

China has launched extensive safety inspections on companies handling dangerous goods in the vicinity of Tianjin Port.

This is seen as showing its determination to clamp down on companies storing hazardous materials improperly in the aftermath of the deadly explosions in August.

State media reported that the Binhai New Area, the sub-provincial district in which the port is located, set up a dedicated office with nearly 100 personnel to carry out inspections on enterprises in the area that transport dangerous goods. The personnel are drawn from the Public Security Bureau, Planning & Resources teams, work safety teams, and the port administration.

“The safety checks will continue until the end of the year and target enterprises that transport dangerous goods,” an official from the Binhai New Area government explained. “Companies determined to lack conditions for safe production will be shut down and those found to be hazardous will be suspended from operation until improvement.”

Operations at the port have largely returned to normal since two huge explosions occurred at a warehouse storing large amounts of hazardous chemicals including 700 tonnes of sodium cyanide. More than 160 people were killed in the blasts.

Fears have been expressed that the blasts could cause supply chain problems for months to come. A report into the effect of the disaster by supply chain technology firm Resilinc said shippers could expect delays arising from the government reaction to the incident and should expect additional scrutiny of cargo and stricter regulations and punishments.

Terminal operators are also under strain with additional administration because the building that processed much of the port’s paperwork was severely damaged in the blasts. That forced them to deal directly with forwarders, haulers and other logistics players

Labour shortages are also a concern, with many residents fleeing the area permanently, fearing lasting environmental impact such as contamination in the water and air, Resilinc said.

Located on the Bohai Sea to the east of Tianjin’s main urban sprawl, the Binhai New Area was set up as a base for China’s industrial reform and innovation. It is one of China’s Special Economic Zones (SEZ) and an incubator for reforms in eight industrial sectors: aerospace, oil exploration and processing, food processing, modern metallurgy, marine chemicals, electrical information, automobile and equipment manufacturing, and bio-pharmaceuticals.

It is home to more than 150 Fortune 500 companies, including EADS Airbus, Rockefeller, and Motorola, and recorded a contribution to the economy of USD143bn in 2014, a 15.5% year-on-year increase, as against 7.4% for China as whole.

Tianjin Port is the world’s fourth-largest port by total cargo throughput and handles containers, metal ore, coal, steel, automobiles and grain.