To cooperate or to compete: a game theoretic analysis on ports in Malaysia and Singapore

    Joshua Ignatius Affiliation
    ; Tian Siang Tan Affiliation
    ; Lalitha Dhamotharan Affiliation
    ; Mark Goh Affiliation


The busiest container ports in the world are mostly situated in the Asian region, thus intensifying inter-port competition. Particularly unique in this region, is the shared history between Malaysia and Singapore, which was once ruled-under the British empire, has since become economic rivals for the Far East – Europe trade route. This provides a suitable context to investigate whether competition or a strategic alliance should be adopted for ports in terms of its benefit to the industry in the region as a whole. Specifically, this paper analyses the ocean freight traffic demand for the Far East-Europe route among three main transshipment ports located in Malaysia and Singapore: Port of Singapore (PSA), Port Klang (PKL), and Port of Tanjung Pelepas (PTP). The paper provides a scenario analysis of the 3-way interaction through a game theoretic model. The results suggest that a strategic alliance between PSA and PTP generates greater profitability to the current hub and spoke network, while PKL should not commit to any cooperative strategy with either PSA or PTP.

Keyword : port competition, port cooperation, game theory, Singapore, Malaysia, transshipment

How to Cite
Ignatius, J., Tan, T., Dhamotharan, L., & Goh, M. (2018). To cooperate or to compete: a game theoretic analysis on ports in Malaysia and Singapore. Technological and Economic Development of Economy, 24(4), 1776-1800.
Published in Issue
Sep 10, 2018
Abstract Views
PDF Downloads
Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.


Airriess, C. A. 2001. Regional production, information-communication technology, and the developmental state: the rise of Singapore as a global container hub, Geoforum 32(2): 235–254.

Alix, Y.; Slack, B.; Comtois, C. 1999. Alliance or acquisition? Strategies for growth in the container shipping industry, the case of CP ships, Journal of Transport Geography 7(3): 203–208.

American Association of Port Authorities [online], [cited 1 August 2013]. Available from Internet:

Asgari, N.; Farahani, R. Z.; Goh, M. 2013. Network design approach for hub ports-shipping companies competition and cooperation, Transportation Research Part A: Policy and Practice 48: 1–18.

Avery, P. 2000. Strategies for container ports: a cargo systems report. London.

Bae, M. J.; Chew, E. K.; Lee, L. H.; Zhang, A. 2013. Container transshipment and port competition, Maritime Policy & Management 40(5): 479–494.

Bichou, K.; Gray, R. 2005. A critical review of conventional terminology for classifying seaports, Transportation Research Part A: Policy and Practice 39(1): 75–92.

Bruttel, L. V.; Guth, W.; Kamecke, U. 2012. Finitely repeated prisoners’ dilemma experiments without a commonly known end, International Journal of Game Theory 41(1): 23–47.

Cheon, S.; Dowall, D. E.; Song, D.-W. 2010. Evaluating impacts of institutional reforms on port efficiency changes: ownership, corporate structure, and total factor productivity changes of world container ports, Transportation Research Part E: Logistics and Transportation Review 46(4): 546–561.

Cullinane, K.; Khanna, M. 2000. Economies of scale in large containerships: optimal size and geographical implications, Journal of Transport Geography 8(3): 181–195.

Cullinane, K.; Yap, W. Y.; Lam, J. S. L. 2007. The port of Singapore and its governance structure, Research in Transportation Economics 17: 285–310.

Das, S. S. 2011. To partner or to acquire? A longitudinal study of alliances in the shipping industry, Maritime Policy & Management 38(2): 111–128.

de Roos, N. 2006. Examining models of collusion: the market for Lysine, International Journal of Industrial Organization 24(6): 1083–1107.

Editorial. 2013. More Triple-E’s ordered at DSME [online], [cited 1 August 2013]. Available from Internet:

Fung, M. K.; Cheng, L. K.; Qiu, L. D. 2003. The impact of terminal handling charges on overall shipping charges: an empirical study, Transportation Research Part A: Policy and Practice 37(8): 703–716.

Garnick, C. 2013. Seattle, Tacoma ports end rivalry, hope to grow jobs, cargo [online], [cited 12 November 2014], Asia/Pacific News, 11 July, 2013. Available from Internet:

Gordon, J. R. M.; Lee, P.-M.; Lucas Jr., H. C. 2005. A resource-based view of competitive advantage at the port of Singapore, Journal of Strategic Information Systems 14(1): 69–86.

Guerrero, D.; Rodrigue, J.-P. 2014. The waves of containerization: shifts in global maritime transportation, Journal of Transport Geography 34: 151–164.

Huang, W.-C.; Chang, H.-H.; Wu, C.-T. 2008. A model of container transshipment port competition: an empirical study of international ports in Taiwan, Journal of Marine Science and Technology 16(1): 19–26.

Hung, S.-W.; Lu, W.-M.; Wang, T.-P. 2010. Benchmarking the operating efficiency of Asia container ports, European Journal of Operational Research 203(3): 706–713.

Ishii, M.; Lee, P. T.-W.; Tezuka, K.; Chang, Y.-T. 2013. A game theoretical analysis of port competition, Transportation Research Part E: Logistics and Transportation Review 49(1): 92–106.

Jia, P.; Mahdiraji, H. A.; Govindan, K.; Meidutė, I. 2013. Leadership selection in an unlimited three-echelon supply chain, Journal of Business Economics and Management 14(3): 616–637.

Kleywegt, A. T.; Goh, M. L.; Wu, G. Y.; Zhang, H. W. 2002. Competition between the ports of Singapore and Malaysia. Technical Report. The Logistics Institute, Georgia Tech, and The Logistics Institute-Asia Pacific, National University of Singapore.

Lam, J. S. L.; Yap, W. Y. 2008. Competition for transhipment containers by major ports in Southeast Asia: slot capacity analysis, Maritime Policy & Management 35(1): 89–101.

Lee, S.-W.; Song, D.-W.; Ducruet, C. 2008. A tale of Asia’s world ports: the spatial evolution in global hub port cities, Geoforum 39(1): 372–385.

Low, J. M. W.; Lam, S. W.; Tang, L. C. 2009. Assessment of hub status among Asian ports from a network perspective, Transportation Research Part A: Policy and Practice 43(6): 593–606.

Mahdiraji, H. A.; Govindan, K.; Zavadskas, E. K.; Hajiagha, S. H. R. 2014. Coalition or decentralization: a game-theoretic analysis of a three-echelon supply chain network, Journal of Business Economics and Management 15(3): 460–485.

Mahizhnan, A. 1999. Smart cities: the Singapore case, Cities 16(1): 13–18.

Midoro, R.; Pitto, A. 2000. A critical evaluation of strategic alliances in liner shipping, Maritime Policy & Management 27(1): 31–40.

Mody, A. 1993. Learning through alliances, Journal of Economic Behavior and Organization 20(2): 151–170.

Monios, J.; Wilmsmeier, G. 2012. Giving a direction to port regionalisation, Transportation Research Part A: Policy and Practice 46(10): 1551–1561.

Oliveira, G. F. D.; Cariou, P. 2015. The impact of competition on container port (in)efficiency, Transportation Research Part A: Policy and Practice 78: 124–133.

Panayides, P. M.; Wiedmer, R. 2011. Strategic alliances in container liner shipping, Research in Transportation Economics 32(1): 25–38.

Qu, X.; Meng, Q. 2012. The economic importance of the Straits of Malacca and Singapore: an extreme-scenario analysis, Transportation Research Part E: Logistics and Transportation Review 48(1): 258–265.

Rizzo, A.; Glasson, J. 2012. Iskandar Malaysia, Cities 29(6): 417–427.

Saeed, N.; Larsen, O. I. 2010. An application of cooperative game among container terminals of one port, European Journal of Operational Research 203(2): 393–403.

Seabrooke, W.; Hui, E. C. M.; Lam, W. H. K.; Wong, G. K. C. 2003. Forecasting cargo growth and regional role of the port of Hong Kong, Cities 20(1): 51–64.

Slack, B.; Wang, J. J. 2002. The challenge of peripheral ports: an Asian perspective, GeoJournal 56(2): 159–166.

Song, D.-W. 2002. Regional container port competition and co-operation: the case of Hong Kong and South China, Journal of Transport Geography 10(2): 99–110.

Song, D.-W. 2003. Port co-opetition in concept and practice, Maritime Policy & Management 30(1): 29–44.

Song, D.-W.; Panayides, P. M. 2002. A conceptual application of cooperative game theory to liner shipping strategic alliances, Maritime Policy & Management 29(3): 285–301.

Sparke, M.; Sidaway, J. D.; Bunnell, T.; Grundy-Warr, C. 2004. Triangulating the borderless world: geographies of power in the Indonesia-Malaysia-Singapore growth triangle, Transactions in the Institute of British Geographers 29(4): 485–498.

Sys, C. 2009. Is the container liner shipping industry an oligopoly?, Transport Policy 16(5): 259–270.

Tongzon, J. L. 2009. Port choice and freight forwarders, Transportation Research Part E: Logistics and Transportation Review 45(1): 186–195.

Van de Voorde, E. E. M. 2005. What future the maritime sector?: Some considerations on globalisation, co-operation and market power, Research in Transportation Economics 13: 253–277.

Wang, Y.; Cullinane, K. 2014. Traffic consolidation in East Asian container ports: a network flow analysis, Transportation Research Part A: Policy and Practice 61: 152–163.

Woo, S.-H.; Pettit, S. J.; Kwak, D.-W.; Beresford, A. K. C. 2011. Seaport research: a structured literature review on methodological issues since the 1980s, Transportation Research Part A: Policy and Practice 45(7): 667–685.

Yeo, H.-J. 2010. Competitiveness of Asian container terminals, The Asian Journal of Shipping and Logistics 25(2): 225–246.