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Monday, September 23, 2019

Maritime Logistics Professional

Hong Kong’s port began its slow but inexorable decline years ago

Posted to Far East Maritime (by on September 27, 2011

When the government and its supporters give their logistics sales pitch overseas, the amount of hot air that gets spewed deserves an emissions tax all of its own.

A delegation of the Hong Kong Logistics Development Council returned recently from a tour to New York where they sprouted the usual cheerleading guff.

The message was that Hong Kong was still relevant and the main gateway to China, and Doris Cheung, the Hong Kong government’s deputy secretary for Transport and Housing, led the trumpet blowing exercise. She said the city had the best logistics experience, the highest efficiency, the strategic location, China’s window to the world, the best link in the global supply chain, the answer to why we are here and the GPS coordinates of the Lost Ark, etc, etc.

But here’s the thing – for the last decade Hong Kong has witnessed the steady erosion of its direct export cargo volume from South China. The port was overtaken first by Singapore and then by Shanghai in annual throughput, and Shenzhen should stroll past when this year’s figures are tallied. In another decade, Hong Kong may not even be in the top 10.

Where once the mainland ports could only look at Hong Kong in awe and marvel at its efficiency, container moves and ability to turn a ship around in hours, they have long since caught up. China’s ports also happen to be closer to the source of their cargo and are therefore cheaper as export points, a key factor for shippers of sea freight.

But such is the denial in the Hong Kong government corridors of power, and its addiction to giant infrastructure projects, that Cheung said they were studying the feasibility of building container terminal 10, “which will double Hong Kong’s capacity”. They've been studying the feasibility of CT10 since 2005. It wasn't feasible then and it isn't feasible now, and no matter how often the government mentions building it, the terminal will never be needed.

Hong Kong’s thoroughput was 23.6 million TEUs last year. How would the port ever need the capacity to handle 47 million boxes when the only thing growing is transshipment, and in the single digits?

Cheung’s lauding of the unwanted, profligate and unnecessary bridge linking Macau and Zhuhai with Hong Kong is equally misguided and misleading. She reckons the bridge will attract investment and offer new opportunities to logistics operators.

Certainly bus tour operators will be giddy with excitement, and temporary jobs will be created for imported construction workers, but in the unlikely event that those logistics opportunities ever arise they will come with tonnes and tonnes of polluting exhaust emissions as thousands of trucks roar up and down between Zhuhai and Hong Kong. One container is carried by one truck.

Let us put aside the fact that no mainland truck drivers are allowed to drive in Hong Kong, adding to the cost of each box. And even if the government can abolish toll fees on the bridge – it has no problem with the grotesque waste of taxpayers’ money so why should a return on investment be important – it will still be cheaper barging boxes in to the port than trucking them over the bridge. Barge is the favoured mode of transporting cargo from the western Pearl River Delta to Hong Kong and Shenzhen ports and that will not change, bridge or no bridge, so those thousands of theoretical trucks carrying boxes to the city will remain that.

And of course the single greatest failing of the bridge was to exclude the only thing that may have made it almost worthwhile – a railway line.

So we suggest the following course of action for all those involved in infrastructure decision-making in the Hong Kong government. First, find a large and solid wall that comprises part of the local infrastructure. Bend over and let your head fall into the wall.

Now stand back and repeat.

And repeat ...

And repeat ...