Hong Kong’s proposed Container Terminal 10 (CT10) is not needed for a long time, but little stands in the way of pouring concrete in this city.
Hong Kong does not need a bridge linking the city to Macau and to Zhuhai on the mainland. But it is getting one at a cost of US$6 billion.
Hong Kong does not need a high-speed rail link to Shenzhen. But it is getting one at a cost of US$8.5 billion.
What about a tenth container terminal – does Hong Kong need one? Well, a two-year feasibility study is currently underway, and all the role players and stake holders are being consulted and once all the evidence is collected that shows convincingly how Hong Kong does not need another container terminal for many years, a new container terminal will be built.
That’s how the system works in a city dominated by vested interests.
Hong Kong Container Terminal Operators’ Association head Alan Lee has expressed doubt that the US$1.3 billion CT10 will be needed “in his lifetime”, and Lee expects to be around for another 15 years.
He gave three reasons not to build the terminal. The global trade slowdown knocked 20 percent off Hong Kong’s throughput in the first half of last year, China’s factories were gradually moving towards producing higher value products that would not require so many containers, and the expanding manufacturing on the western Pearl River Delta meant there would not be as much reliance on Hong Kong port.
Lee’s comments prompted a response from a long-time Hong Kong commentator, columnist Jake van der Kamp. According to the cranky scribe, Hong Kong’s port is on its way out, just like London and New York, and good riddance.
As extreme as his position may seem, he does have a point. It costs a lot less to ship a container from a Dongguan factory out of a Shenzhen port than to truck it across the border to Hong Kong. Cost has been found to play a leading role in the port choice of PRD shippers because of the low-margin stuff in their boxes.
Direct exports via Hong Kong are falling and transshipment is growing, and this trend will continue. Hong Kong needs the direct exports that bring greater economic value to the city rather than boxes coming in off one ship and leaving on another.
Building terminal 10 will create another expensive, under-utilised piece of infrastructure, just like the HK-Macau bridge, the high-speed rail link to Shenzhen and even Stonecutter’s Bridge that spans the Kwai Chung port and looks great but is largely without purpose. A concrete Paris Hilton.
But for us, the most telling reason not to build CT10 has to be that the association actually representing the interests of the container terminals says it is a bad idea. They should know.