This report aims to analyze drawbacks of the Port Authority and to suggest the ways to improve its administration. The Port Authority, a public institution, is established to develop Korean ports as the central base of marine transportation which contributes to the reinvigoration of national economy. The Korean government has introduced the Port Authority System in main local ports which are Busan, Incheon and Ulsan Ports since 2004. In addition, the Yeosu-Gwangyang Port Authority has been founded in August 2011.

  However, the Port Authority has been criticized by the National Assembly, the Board of Audit and Inspection (BAI) and the Ministry of Strategy and Finance (MoSF). The Land Transport and Maritime Affairs Committee in the National Assembly pointed out the overlapped work responsibility between the Port Authority and the Regional Maritime Affairs and Port Office and the inefficiency of port administration system. The BAI recommends the amalgamation of local port authorities to enhance its efficiency. Furthermore, the Busan Port Authority and Incheon Port Authority were marked as c-class among 13 state-owned companies in the management evaluation 2010 run by the MSF.

  According to the analysis, most of local port authorities concentrate on port infrastructure management and port dues collection rather than improve efficiency and professionalism in the field of port development and administration. It does not accord with the purpose of establishing Port Authority to introduce developed port system in Korea. There is a shortage of performance management concerning the incentive system by providing a part of earnings to ship-owners.

  The National Assembly Budget Office (NABO) requires to the Port Authority make clear responsibility and administration system to realize its goal. Additionally, the performance management regarding the incentive system should be reformed to attract the goods transported via ports.