I would like to acknowledge the efforts of David Stowe, our Chairman, and the other Board members who have provided valuable counsel over the past year to help us attain our objectives. Their advice and experience has had a significant impact on the results being reported to you today.

Annual General Meetings are an opportunity for organizations to review the year, assess performance/ to celebrate accomplishments. And in the case of the Vancouver Port Authority, theres reason to celebrate.

This year our accomplishments can be measured in a number of different ways: the 6% increase in total tonnage shipped through the Port of Vancouver last year; the 7% increase in bulk cargo, and the record 1.54 million TEUs of container traffic handled by our port. Also of note is the 7% increase in our 2003 operating revenues compared to 2002.

These accomplishments speak to the performance of the tens of thousands of people, the companies, the industries and the institutions that contribute to helping us to achieve our Vision to make the Port of Vancouver the port of choice on the west coast of North America.

In addition of the Chairmans thanks to the many men and women who make the port of Vancouver a national and international success, I would also like to congratulate everyone for their hard work and commitment, it is you who have made us a safe, reliable and efficient gateway for Canadas international trade with the Pacific Rim. A special mention and my personal thanks to the staff of the Vancouver Port Authority for their continuing hard work and dedication.

The Port of Vancouver is Canadas largest, busiest and most diversified port. For much of Canada, we are the gateway to trade. We help Prairie farmers to send their grain to markets overseas, coal producers to ship coal around the globe and forest companies to deliver their product.

With its container business the Port enables consumers to buy manufactured goods including clothing, electronics and auto parts. All of these things pass through our port each day. Collectively, this translates into the 66.7 million tonnes of cargo handled during 2003.

A record 1.54 million TEUs in total containerized cargo was handled in 2003. It is this continued upward trend that led to the unveiling of the first phase of our Container Expansion Program which will enhance existing container terminal capacity at Vanterm and Centerm through a combination of new equipment, new facilities and productivity gains.

By the end of 2005, these two terminals on the south shore of Burrard Inlet will enhance the ports overall container capacity by more than 30%.

The first phase of container expansion at the Port of Vancouver represents a collective capital investment by TSI Terminals, P&O Ports and the VPA of about $160 million.

These are significant capital investments by respected global enterprises. Not only do they demonstrate the significant business investment that the Port of Vancouver can deliver to British Columbia, they also reflect the opportunity that the transportation sector holds for the economic future of our province.

2003 also saw the initiation of a federal and provincial environmental assessment review of the Roberts Bank Container Expansion Program.

As many of you know, the VPA has proposed that a third berth be added to the existing Deltaport container terminal at Roberts Bank, to be followed by the development of a new three-berth container terminal currently known as Terminal 2.

The Roberts Bank initiative will increase the Port of Vancouvers total container terminal capacity to 4 million TEUs by 2012, and to more than 5 million TEUs by 2020. It will also inject another $1 billion of capital investment into our province.
These are significant projects and I am pleased to report that we made exceptional progress last year in our plans to expand our overall container capacity.

While the VPA is aggressively pursuing infrastructure development at the Port of Vancouver to capture future business opportunities, we must have a corresponding expansion of B.C.s and Canadas road and rail infrastructure to enable the port of Vancouver to achieve its growth potential.

We are already seeing delays in cargo movements from the Port of Vancouver as a result of road and rail congestion. This is not unique to Vancouver, as many ports on the West Coast of North America, Asia and Europe are experiencing similar congestion associated with extraordinary growth beginning in the 4th quarter of 2003.

Without investment and regulatory changes from all levels of government, without investment from those in the nations transportation industries and without a cooperative spirit from all who make their living by international trade the competitive position of this port will inevitably begin to erode.

Its not just the Port of Vancouvers competitiveness thats at stake or Canadas status as a leading player in international trade but the competitiveness of every port and every facet of the import and export trade in the country.

I want to assure you that throughout 2003 and continuing in 2004 the VPA actively petitioned its public and private sector partners in Canadas transportation network to make the regulatory changes and the strategic investments necessary to keep us competitive in international trade. Id like to encourage all of you to join your voice with ours to ensure success in this initiative.

Believe me, your voice does have an impact as can be seen from the significant progress made with regard to the Canada Marine Act. Many of you will recall that the VPA led a national coalition of port and transportation businesses to demand changes to the Act.

In 2003, an independent panel reported to the Minister of Transport and agreed with our submission on virtually every point. With your help, we continue to make our case in Ottawa. Without a formal response from the Department of Transport to the Report, the VPA is now negotiating a substantial increase in our Borrowing Limit, opportunities for the port to access infrastructure and other financing mechanisms.
You were clearly heard during representations regarding Port Security and the funding required to keep our port facilities secure, and I also acknowledge the efforts of the BC Wharf Operators in seeking a more competitive tax regime for port businesses in B.C. The tax policy changes introduced by the B.C. government last fall will not only stimulate greater investment in our port, as has already been seen, they will also maintain the property tax base for our neighbours in municipal government.

Id like to acknowledge the leadership and vision of the Provincial Government in advancing this progressive tax policy. Tax changes that stimulate investment in port businesses ultimately grow the tax base for the benefit of us all.

Also in 2003, the provincial government, acting on our recommendation, initiated the development of a comprehensive and integrated ports strategy for B.C. The process for development of this strategy is under way and such an initiative shows tremendous promise for all gateway ports in B.C. When complete, the B.C. Ports Strategy is expected to provide a strategic vision of how trade should be managed at B.C.s key seaports to optimize our competitiveness, deliver investment and economic growth, and achieve socioeconomic benefits throughout the province.

In addition to the active role in shaping our domestic policy environment, we continue to adapt our business in response to global issues and trends.

Security continues to be an on-going initiative of great importance. In 2003, the VPA took steps to strengthen security measures at the Port of Vancouver partly in response to the International and Port Facility Security Code (or ISPS) established by the International Marine Organization.

Under the VPAs leadership, the Port of Vancouver is implementing a comprehensive, port-wide program of security enhancements to achieve full compliance with ISPS and corresponding Transport Canada regulations which will be implemented on the 1st of July.

In fact, this initiative goes beyond regulatory compliance to ensure that our port is acknowledged as one of the most reliable and secure ports in the world, and a model for the rest of Canada.

Security initiatives achieved by the VPA in 2003 include the expansion of our ports photo identification program, implementation of a vehicle access control system, and leadership in the development of port facility security plans for all ports and each of more than 100 international terminals up and down the BC Coast.

Our goal is not only to secure port assets and ensure the efficient movement of goods and people through our port, but also to safeguard national security and the communities in which we operate.

In 2003 the Port of Vancouver continued working with our partners to secure new trade and business opportunities in our cruise industry and in our efforts to expand Canadas trading relationship with China, the worlds fastest growing economy.

In the cruise sector, the Port of Vancouver suffered a decline in its cruise business in 2003. This was a direct response to the availability of new capacity at the Port of Seattle, and other changes in the North American tourism market in response to the terrorist attack on 11th September 2001.
I want to assure you all that the Port of Vancouver remains a very desirable cruise destination and has maintained a dominant share of the Alaska cruise ship business we helped to establish. However, we now have competition and that means were going to have to expand the cruise ship market in the Pacific Northwest if we want to resume our history of growth.

So, along with the ports of Victoria, Nanaimo, Campbell River and Prince Rupert, we are active participants in a program to develop and market made in B.C. cruise products.

Cruise BC was initiated in 2003 and launched at the Seatrade conference this spring in Miami. It is a vital partnership of port, tourism and community interests with the common goal of expanding the cruise ship market in coastal British Columbia.

It is a very promising initiative of which the VPA is a founding partner. Its success will not only benefit our port, but our partners up and down the coast.

Another example of where the VPA is working with its partners to establish future business opportunities relates to China, and the expansion of Canadas trade with Asia-Pacific economies.

On a tonnage basis, China is now our second largest trading partner second only to Japan. And our trading relationship with China has the potential to continue this growth.
China is becoming or has become the worlds largest consumer of natural resources, such as coal, potash, sulphur, minerals and forest products all of which are produced in western Canada and shipped through the Port of Vancouver.

In addition, China is rapidly becoming a global manufacturing leader with many of its products destined for North American markets. We are well positioned to be the gateway for Chinas growing import trade with North America.

We are well positioned to help our customers and partners with relationship building, market intelligence and the development of new trading opportunities in China with the help of our office in Beijing that was opened 10 years ago.

Since that time, we have gone on to establish a global network of trade representatives throughout Asia including Hong Kong, Japan, Korea, Singapore and Taiwan. We have also long established sister port relationships throughout the region.

Commitments such as this continue to enhance the Port of Vancouvers reputation for competitiveness. They also add value to businesses that choose our port.

Our focus includes not only our business customers but also our community and we have been working to be a good neighbour by offering grants and donations to more than 150 community groups and learning institutions.
The VPA also recognizes the importance of education and business working together to develop the qualities and skills of our future workforce and business leaders. Last year, the VPA provided 17 scholarships to secondary and post secondary schools in Western Canada.

Im sure you will agree that 2003 was a successful year and we should celebrate these successes but we also have challenges ahead of us and we will work with our industry partners and the communities that surround us to strengthen and build our business.
Once again, thank you all, our accomplishments are yours too.


For more information, please contact:

Anne McMullin,
Director, Corporate Communications and Public Affairs
Vancouver Port Authority
(604) 665-9069 (office)
(604) 665-9073 (fax)
(604) 218-1403 (cellular)
anne.mcmullin@portvancouver.com

For more information:
For more information on any of these stories, call 1-888 PORTVAN.
Or, send an email to:
public_affairs@portvancouver.com