About US$325 million will be invested by the Bohai Jinji Port Investment and Development to develop port facilities in Tianjin and Hebei on the Bohai Sea, said Li Zengjun, chairman of the company, reported China Daily.
"Each partner holds a 50 percent stake, which will promote an equal relationship between the Tianjin and Hebei ports," Li said.
Tianjin is a regional hub for many railroads in northern China. It is also the countrys third-largest maritime port by bulk cargo throughput and the fourth-largest by container throughput.
Hebei Port Group, established in 2009, has experience in bulk cargo transportation and has favourable seashore resources.
"The partnership of the two northern ports could lead to a bigger alliance to coordinate container and bulk cargo shipping, as well as supporting logistics networks, storage facilities and human resources," said Zhang Shouguo, vice-president of the China Shipowners Association.
According to Tianjin Port, the venture will manage port resources, boost the development of regional logistics, promote shipping and logistics finance and support shipping services.
"The purpose of signing the new agreement is to compete with fast-growing ports such as Shanghai, Ningbo-Zhoushan, Xiamen and Shenzhen in the south," said Zhang.
Boosted by rising berth utilisation rates and throughput, these ports profitability improved in the second quarter compared with the same period in 2013.
"This strategy can cut costs for daily operations, staff and other items. It is practical for Chinas major ports to form a union to offset competition from larger ports in the south, as well as regional rivals such as Busan, South Korea, given current shipping market conditions," Zhang said.
