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Logistics industry takes a turn as economic star

Chris Davis

HIGHLIGHTED AS ONE of the Hong Kong government's pillars of the economy, the logistics sector goes from strength to strength as it continues to expand rapidly.

Estimates suggest more than 200,000 people, or about 6 per cent of Hong Kong's workforce, are employed in the logistic industry.

The government's commitment to developing logistics capabilities and turning Hong Kong into a regional hub led to the establishment of the Logistics Development Council in December 2001.

The council, which is made up of government and independent members, aims to build on the solid infrastructure in place and create an environment that will boost the development of Hong Kong as the preferred international and regional logistics hub and a supply-chain base.

The council also works closely with logistic teachers and trainers to formalise qualifications and develop programmes that meet the demands of a fast-changing industry at the forefront of globalisation and information technology innovation.

Universities and training institutions also recognise logistics has now expanded beyond transport to include procurement, quality control, systems and finance.

To meet these needs they offer extensive education programmes and on-going courses.

There are about 130 logistics-related programmes being run by various college-level institutions and professional bodies.

As the activities of logistics companies expand, there is growing demand for employees to carry out cargo tracking, purchasing and materials management.

The professional diploma in logistics management and a range of certificate courses offered by Lingnan University have been developed to meet these needs.

Also keeping pace with the rapid evolution of logistics and supply-chain management is the Poon Kam Kai Institute of Management at the University of Hong Kong. The institute offers a graduate diploma in e-supply chain and logistics leadership.

The seven-month diploma course is designed for executives who hold a university-level degree and have at least three years' postgraduate work experience in logistics.

The programme is structured around four compulsory modules: logistics management; e-commerce; supply-chain management and developing leadership in a changing environment.

In a survey on the logistics industry, the Hong Kong Productivity Council found many local service providers considered the logistics infrastructure development in the Pearl River Delta as a mixed blessing, presenting both opportunities and threats to Hong Kong.

Entitled 'Hong Kong - the Logistics Hub of the Region', the survey aimed to identify the factors affecting Hong Kong's status as a regional logistics hub, as well as the industry's needs in technology and service support. Sixty companies, most involved in third-party logistics services, manufacturing, warehouse operation and freight forwarding activities, took part in the survey in October.

It found that 45 per cent of respondents thought the opening of the new Baiyun Airport in Guangzhou and other logistics infrastructure development in the Pearl River Delta, such as container terminals, would present a new world of opportunities to expand into the mainland, while 43 per cent saw the developments were a threat.

John Liu, head and chair of Maritime Studies, Department of Logistics at the Hong Kong Polytechnic University (PolyU), said without ocean transport, real world logistics and the global supply chain would not exist.

Professor Liu said PolyU's postgraduate International Shipping and Transport Logistics programme was unique in Hong Kong.

'Our heritage in maritime studies places us at a distinct advantage to spearhead the development of supply chain management-based maritime studies in Hong Kong and Asia,' Professor Liu said.

Through linking classes to the real world, the PolyU is working towards achieving excellence in maritime studies, shipping, transport and supply chain logistics by providing high quality of teaching, research and consultancy.

The Hong Kong Logistics Association (HKLA) also helps to promote the logistics sector by drawing on the experience of its 1,000 members representing different sectors in logistics such as shipping, freight forwarding, IT and retail.

Established in 1996, the association is a professional institute that aims to provide a forum for local logistics professionals to expand and develop their understanding and skills in the practical implementation of operational and strategic aspects of logistics.

HKLA teamed up with the Productivity Council in 1998 to pioneer formal professional training (the Professional Diploma) for logistics practitioners.

HKLA has also supported the Education and Manpower Bureau's Springboard projects run under Caritas Adult and Higher Education.

The Trade Development Council says the logistics market in China presents an enormous opportunity. Driven by rapid growth, international trade and a government focus on upgrading China's logistics infrastructure, total expenditure on logistics in China will grow substantially over the next few years.

The Closer Economic Partnership Arrangement (Cepa) between Hong Kong and the mainland is also expected to stimulate substantial growth for Hong Kong firms that offer services on the mainland, primarily as a result of enhanced market access and increased cross-border trade.

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