Development Impact Measurement of Global Seaports

The Challenge

The World Bank Group considers infrastructure development to be critical to achieving economic growth and reducing poverty. Seaport developments in particular may have a substantial economic impact as they allow for increased traffic and cheaper and faster transport. The World Bank’s International Finance Corporation (IFC) provides support for the seaports sector with 52 investments in 20 countries and a total commitment of USD 2.2 billion in own account financing. In order to be able to assess the economic impact of its port projects, World Bank/IFC engaged HPC and Hamburgisches WeltWirtschaftsInstitut gGmbH (HWWI) to develop a model and tool for the ex-ante assessment of the economic impact of seaports projects in terms of GDP and job creation.

Tasks Performed

• Literature review with regard to relevant academic literature and existing models for economic impact analysis of transportation
• Assessment of the data available from public data sources and IFC project documentations for projects in 20 countries
• Assessment of the required scope of the model including different cargo types (container, break bulk, dry bulk, liquid bulk) and traffic types (exports and imports, domestic traffic, transit traffic, transhipment)
• Elaboration of a methodology for the economic impact assessment of seaport projects based on input-output analysis / social accounting matrix approach, accounting for the direct/indirect/induced impact of development and operation as well as second order growth effects (increased capacity, reduced transport cost and time)
• Implementation of the model as a tool in MS Excel to facilitate the assessment of the economic impact of IFC’s seaport development projects in 20+ countries

Benefit 

• Sound indication on projects’ advantageousness in early project stage
• Minimised efforts in application to projects given public data source use
• Reusable and expandable to other ports and sectors