PTP chief executive officer Mohd Sidik Osman said yesterday such 'co-opetition' - cooperation and competition - will provide the best product and drive PTP and PSA to even better service levels.

He was responding to an opinion expressed by PSA senior vice-president for marketing John Ong on Saturday for more constructive competition, rather than the 'disruptive' contest going on now between the two terminal operators. Mr Ong said in an interview with the business weekly The Edge Malaysia that 'ways to avoid disruptive competition and promote a healthy rivalry' between the two can be discussed.

He clarified yesterday that during the interview with the Malaysian paper he expressed his personal opinion and this had unfortunately been highlighted as an official view. He said PSA welcomes competition, whether it is across the Causeway or competition in general.

In the meantime, PTP's Mr Mohd Sidik responded to Mr Ong's views, saying that PTP had made offers on possible cooperation several times in the past few years. 'It will definitely be possible for co-opetition, or competing to provide the best product. This will drive both PTP and PSA to even better service levels,' he said.

A PTP source later pointed out that two top-level Singapore civil service delegations were among those hosted by the Johor port. The first was in August 1999 before the port began commercial operations, and the other in August last year after it went on stream with Singapore's biggest port customer Maersk-Sealand.

In press statements marking the visits by civil servants under the Singapore Civil Service College's Leaders in Administration Programme (LAP), the Johor port had said it viewed the visits as the 'start of mutually beneficial cooperation and the building of smart partnerships' between the two ports.

It went on to say that it not only viewed the visits as being for marketing purposes but also as a way to develop international understanding and cooperation in the confidence that both parties can begin a mutually beneficial process.

Mr Sidik said then: 'We can draw on each other's strengths and this will make both our countries stronger to face increasing global challenges and new paradigms facing the port and shipping sector.'

However, a shipping analyst who asked not to be named, told BT yesterday that while all this sounds nice, 'in the short term one has to ask how realistic this is, given recent history'.

'Looking at the business aspect of this, the price tag is a major component in deciding where the container boxes go, and given that PSA still earns some $400-500 million per annum after rebates, my feeling is, handling charges have got to fall further.

'Once prices are in line, then the level of efficiency comes into play. Looking at a period of slower growth and aggressive expansion plans by both PSA and PTP, the most 'co-opetition' can do is to prevent handling charges from falling to such low levels that neither operator makes a real profit when land reclamation costs are taken into account,' the analyst said.