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Local Voices

Savannah Estuary, Promising and Pristine

The recent nudge by the White House, a ‘go ahead’ for the Savannah Harbor Expansion Project (SHEP) is a tremendous win to the State of Georgia. With the development that took place on July 18, the administration decided to expedite all federal reviews and complete a Record of Decision before November of this year.

The State of Georgia ought to welcome this gesture made by the Obama administration in deepening Savannah’s harbor.  The issue is about improving infrastructure, spurring the economy, and creating jobs. Most importantly, it is about geopolitical posturing for Georgia, nationally, regionally and globally with improved global trade links, investment and competitiveness. Viable economic project with a good rate of return and a relevant dose of political push, garner required investment support if the project design is sound. However, such positioning and design comes with careful planning of strategies, important, for the SHEP poses hot-button environmental challenges. Overcoming these challenges will be critical for successful implementation of the program and require concerted effort by all.

While the project promises all good things that are in dire need, jobs, infrastructure and a good economy, by no means indicates that it will be a smooth ride. Clearly, like any mega million project – the question boils down to costs and impact on external environment, particularly when design alter the natural course of ecosystem and habitat. Then it is also prudent to be financially and environmentally conscious in order to recognize risks in a timely manner. As a priority initiative, placed on the political radar screen, entices attention of stakeholders, which is a good thing. This port is included within the Presidential Executive Order issued in March 2012 together with other five major ports aimed at improving and revitalizing existing outdated designs.

Even though Savannah port is the second largest gateway in the East Coast after New Jersey, the design lacking direct accessibility to the ocean is restrictive, leading to losses in opportunity costs.  The port is located 38 miles up Savannah River from the ocean and has a depth of 42 feet. These design parameters limit passage of supersized cargo ships through this harbor.  The SHEP proposes to provide direct access to the ocean, dredging existing channel by deepening to 47 feet. The project costs are enormous, calculated at around $650 million involving an estimated federal funding of $400 million, set aside $1.4 billion estimated for terminal improvements. With this scale of a project, anticipating a phased design approach could also be a solution. A well-conceived model could assure the public that the idea is not to burden taxpayers in paying for marine commerce, but rather to demonstrate a coherent and convincing infrastructure plan.

While the economic merit behind design modification are understood well, community concerns in implementing a project of this scale point to environmental realities that require due attention. These concerns ought to shape developing of effective strategies to overcome environmental risks during implementation. In order to protect the estuary’s ecosystem and wildlife, several environmental challenges are foreseeable during implementation of the program.

The challenges include saltwater intrusion, increasing of dead zones due to low levels of oxygen, and destruction of natural habitat of freshwater wetlands.  Sludge disposal is a core concern and at the center of debate among environmental agencies as sludge from the river contain cadmium, a toxic element. The debate is not only about keeping adequate procedures in place but also about compliance, standards and safeguards for successful implementation. However, mitigation measures and monitoring of programs alone will not suffice. Careful consideration of collaborative and adaptive strategies during, after and the early stages of implementation of the project is equally important. Cooperation, collaboration and negotiation at the local level will guide risk reduction in a transparent manner.

In the absence of a silver bullet in achieving the country’s economic goals from a national point of view, the SHEP combines as a worthy addition to a comprehensive National port vision and plan. Certainly, for Georgia, this project is an economically and politically viable option to pursue, in moving goods labeled ‘Made in the United States’ over the ocean. Along with these goods, in parallel, the project will prompt the State forward Atlantic, expanding trade-links beyond the arena of Trans-Pacific while creating jobs and stabilizing local economy. However, mitigating risks with effective environmental strategies also determine the viability of the project in the end.

 As the project analysis sinks deep, into the pristine waters of the Savannah River as well as within the hearts of the local communities, realizing the promise of the estuary will require collaborative efforts from all. It is time for cooperation in shaping effective strategies.

UHaveGotToBeKidding

4:31 pm on Monday, July 23, 2012

Amreeta,
How do you think this will create jobs long term?
The majority of the goods are coming from oversees labor and are the hi-end goods the US consumer buys vs we are shipping a lot corrugated boxes and packaging around the globe (low cost items) from the port.

Appears that this will only strengthen the hi-end goods and keep our wages down in the US.

Reply

Amreeta Regmi

3:31 pm on Tuesday, July 24, 2012

Thank you for your interesting observation.

Savannah Port is one of the largest and busiest in the U.S. bringing in both high-end and low-end products, and shipping out around 10 different products ranging from agriculture, retail items, chemicals, automobiles, etc. I did not get into this detail.

There are interesting developments taking place within emerging economies, our trading partners. Countries in South East, Pacific and South Asian, once considered as having robust economies are gradually facing early signs of the impact of global economy. Risks from Europe are already affecting financial flows. The decline in commodity prices is also slowing export growth. On one hand we are faced with this scenario. On the other hand, emerging countries have invested in education, infrastructure and health, and have succeeded in reducing poverty levels unlike the U.S. These countries are beginning to utilize their deficits by investing on infrastructure and human capital. For instance, the number of people living in poverty is reduced by half in East Asia and the Pacific in the past decade. Middle class has significantly expanded. In the long run, because of how our global economies are connected, poverty falling and increase in educated class, labor and wages will not be cheap impacting external demand. Countries in East Asia and Pacific will begin to rely less on exports and start focusing more on domestic demand, which is already happening in India, Indonesia and China.

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Amreeta Regmi

3:35 pm on Tuesday, July 24, 2012

In order to maintain our domestic demand and growth, the current administration is already working to balance our trade. In balancing our trade, in the long run, our exports will be guided by external demand and investments in the domestic sector requires careful observation and analysis of this external demand. Development of domestic industries will depend on this external factor as well as local demand. Integrating our manufacturing industry together with partners from other nations, as we are seeing already happening in Gwinnett, is also an area to strengthen in the future. Sadly, our reforms are not always supportive to foster the domestic labor market and growth as is already seen by our tight immigration policies and lack of productivity enhancing reforms.

Funding for infrastructure in times of economic slowdown is not an easy task. This investment is required for growth.

A comprehensive discussion on trade imbalances – exports and imports, financial flows and impact on wages deserves a separate blog post.

For the most part the question with the Savannah Port is how do we improve domestic infrastructure and economy, balance trade and at the same time protect our environment?

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Jason Green

5:16 am on Wednesday, July 25, 2012

This will be a difficult balance partly because we Americans in general do not like trade, as it is perceived in benefiting the other side while trade indicates mutual benefit. Explaining the benefits of Savannah project in lay person's terms would be helpful. In addition to this, there are environmentalists on the other side of the aisle playing dominant activism. Coming to a reasonable agreement will require an independent eye, what is good for the economy and the environment.

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Sydney Mitleman

8:13 pm on Friday, July 27, 2012

Isn't it all politically driven?? Why am I not so surprised!? Blame it on citizens and the envioronmentalists when all big decisions like these are all made right before the elections. Does any politician really care what happens to an average citizen?

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