Cost of chaos

PUBLISHED : Saturday, 11 July, 1998, 12:00am
UPDATED : Saturday, 11 July, 1998, 12:00am

Chek Lap Kok was meant to provide a boost to the flagging economy. Instead its problem-plagued opening has sent the SAR spinning still faster towards a recession.

Even the Government now admits the suspension of air cargo shipments until at least next weekend will hurt economic growth. Some estimate the total cost to local businesses at up to $30 billion. But this may prove to be an under-estimate, as there is no guarantee the embargo will end after eight days. Even when it does, there will inevitably be further problems, given the logistical difficulties involved in transporting cargo between Kai Tak and Chek Lap Kok.

Indeed, HACTL now admits it may be many months before the situation returns to normal. So, for the foreseeable future, the main air cargo handler will simply not be a reliable route for sending goods in and out of the territory. That means alternatives to HACTL must quickly be found before export orders are lost and a shortage of parts causes manufacturing throughout southern China to grind to a halt.

Other handlers at Chek Lap Kok are one option, although they are also experiencing problems. Another alternative is to use passenger flights, as some businesses are now doing. But these can carry only a limited amount of cargo, which means the Government must step-in and establish a priority system to ensure the most urgent consignments are carried first.

Wherever possible, cargo can be diverted through Macau, Shenzhen and other airports in Guangdong. That will hurt Hong Kong's reputation as a regional hub. But that is a price which may have to be paid, given the devastating effect of a prolonged air cargo embargo on the local economy.

This is not the time for recriminations when such vital issues are at stake. But when normal services are eventually resumed, the Government must make it a priority to inject greater competition into the air cargo business so that Hong Kong will never again face such problems because of difficulties with a single company.