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A new £20m research centre to help the port sector in the Humber become the best in the world has been given the final go-ahead. It will focus on "supply chain management" - how goods are processed and handled through the region's ports. The Humber Estuary, including the ports of Hull and Goole, is northern England's gateway to the world, thanks to its links with northern Europe and the Baltic.

Ports and related industries employ thousands of people in East Yorkshire. Institute director Professor John Mangan hopes the organisation's success will attract still more investment to the region.

He said: "The institute will become an internationally recognised centre of excellence in logistics, attracting new regional investment and accelerating economic growth.

"The Humber, as a global gateway to the north of England and beyond, is ideally positioned to play a leading role in global supply chains."

The institute has been given £9.94m from the university, £5.27m from the European Regional Development Fund and £3.67m by Yorkshire Forward.  It will carry out research and consultancy, as well as working closely with local businesses.  The institute is already up and running, led by Prof Mangan, but will now be able to build a new home for itself next to the University's Business School.

The university is aiming to become an international centre of excellence for its business education. Its new £8.7m home in Cottingham Road was opened in December by CBI director-general Sir Digby Jones.  In March 2006, the Business School became one of only 89 in the world to win the EQUIS accreditation from the European Foundation for Management Development, showing it is recognised as a world leader.

Simon Hill, executive director of business at Yorkshire Forward, said: "Having come from a manufacturing background, I know how important effective supply chain management is to a company's success.

"This institute will not only ensure companies of all sizes are able to operate effectively in spite of increased overseas competition and transport costs, but also place Hull and the Humber sub-region on the map as a centre of excellence for this kind of work."

Alison Biddulph , Director of the European Secretariat at the Government Office for Yorkshire and The Humber commented:

 “With its ports complex and coastal location, Hull plays a vital role in European trade networks.  The Logistics Institute will combine the opportunities offered by this location with the outstanding academic expertise on offer at the University of Hull. This will provide a fantastic facility for companies wanting to succeed in a competitive market; a vital need that I am delighted European funding is helping to address.

University vice-chancellor Professor David Drewry said the creation of the Logistics Institute was a major step.

He commented: "The institute will bring together expertise from across the university, for example in business and engineering.

"Focusing initially on ports and harbours, supply chain management and radio frequency tracking of goods, the institute will have far-reaching implications for the economic future of the region."