With privatisation looming and Malaysian upstart rival Port Klang threatening to become a serious competitor, the state-owned giant Port of Singapore Authority (PSA) has started to awaken from the sanctuary of its home-port monopoly and is venturing abroad in search of growth. The authority may be a late starter in the fiercely competitive market, but it believes its connections, experience, technological know-how and reputation for quality will help it catch up. 'We want to be the Ritz of port terminal operators,' says PSA's international business division president Goon Kok Loon, who is heading the drive to internationalise. The authority's initial success has primarily been in China. Its first big deal was in Dalian, where it has had three container berths in operation for close to a year. A fourth berth is expected to be commissioned any day now. In April this year the PSA teamed up with Henderson China and Indonesian-backed Pacific Industries to operate the existing container terminals at Qingzhou and Daijiang in Fuzhou, one of the two ports recently designated for direct shipping links with Taiwan. The same joint venture will also develop and manage a new deep-water container terminal outside Minjiang, also on behalf of the Fuzhou Port Authority. This week, the PSA branched out by signing a US$187 million deal in London to build quays and a container terminal for a free zone at Yemen's southern port of Aden. It also announced it might bid to help run Thailand's new port at Laem Chabang. More deals are being sought in China, with some close to fruition. Opportunities are also being eyed in India, Indonesia, the Philippines, the Middle East and the Mediterranean. In February, the PSA and Sembawang Maritime of Singapore were invited to conduct feasibility studies into developing an existing wharf at Cigading in West Java into a container terminal. In tune with a global push by the World Trade Organisation for countries to privatise and liberalise, the Singapore Government intends to go to parliament by the end of this year to dissolve the PSA Bill and make the authority a private corporate entity. This is likely to be a precursor to a stock market listing a few years down the track. Singapore Telecom and Singapore Airlines have already been corporatised before listing. Now it is the PSA's turn. Preparations are already under waywith management restructuring encouraging staff to think and act more aggressively. Singapore was again named the busiest port in the world in terms of tonnage this month - a title it has won every year since 1986. It has the space to keep growing - four more deep-water container berths are scheduled for completion next year on a 127-hectare reclamation the size of 206 football pitches off its west coast at Pasir Panjang. There are options for further phases if required. However, with growing competition from its Southeast Asian neighbours, the real question is whether there will be enough demand to warrant such expansion. Singapore Deputy Prime Minister Lee Hsien Loong warned in May: 'Shippers route containers through Singapore because PSA is efficient, and they save time and money doing so. 'But our neighbours too hope to develop their ports into hub ports instead of being feeder ports to PSA. As their economies grow and exports and imports increase, it begins to be worthwhile for shippers to call directly at their ports, and cut transit times by bypassing Singapore.' In October 1995, Malaysia doubled levies on goods vehicles crossing the causeway into Singapore to encourage Malaysian importers to use Port Klang. Singapore saw the move as aggressive, but Malaysian Prime Minister Mahathir Mohamad described the tactic as 'mild arm-twisting'. There are also questions as to whether the PSA can catch up with its rivals in the fiercely competitive international ports game. Mr Goon concedes Li Ka-shing's Hong Kong International Terminals, Australian-based P&O Terminals and International Container Terminal Services of the Philippines are probably five years ahead of the authority and have bagged many of the best deals. Hong Kong International Terminals, in particular, has already snared most of the choice port locations in China. However, he believes openings would still emerge for the authority. 'As governments worldwide deregulate terminals and look outside for expertise, then there will be opportunities for us,' he said. While the PSA may be a newcomer in terms of developing ports in China, it is no stranger to the mainland authorities, having first served as a consultant on behalf of the World Bank more than 10 years ago. Today, it has a particularly cosy relationship with Cosco, China's state-run carrier and the world's fourth largest shipping company. In April, it signed a new long-term agreement with Cosco, under which the PSA promised to customise its services to suit Cosco's operating and business requirements and offer long-term price guarantees. In return, Cosco committed itself to using Singapore as a major hub for its container operations. It docks 55 vessels a week in Singapore. This latest agreement lays the necessary groundwork for Cosco to launch new services from the Far East through Singapore and the Mediterranean to the east coast of the United States. As well as owning, developing and managing ports, the authority intends to use its corporatisation as an excuse to diversify into other related areas, like logistics and redeveloping old waterfronts and harbours. Mr Goon pointed to the giant London Docklands property redevelopment in England as an example of what could be done to old waterfronts. Li Ka-shing has already used his real estate expertise in this field. As for logistics, Mr Goon envisaged the PSA setting up a special division to act as third-party advisers to multinational manufacturing companies to cater for all their international transport needs. It would kick off in Singapore, focusing on multinationals that use Singapore as regional headquarters, then branch out abroad.