Call for shipping minister backed by port operators

PUBLISHED : Saturday, 17 July, 2010, 12:00am
UPDATED : Saturday, 17 July, 2010, 12:00am

The city's top container terminal operators, including Li Ka-shing's Hongkong International Terminals and Wharf's Modern Terminals, have thrown their weight behind calls for the creation of a shipping minister responsible for maritime affairs.

The backing has come from the Hong Kong Container Terminal Operators Association, whose five members operate the nine terminals at Kwai Chung port.

Association chairman Alan Lee said a shipping minister was needed to tackle long-standing issues that threatened the port's competitiveness in relation to others in the south.

'We support 100 per cent this proposal [for a shipping minister] because there is a need for the government to have more focus on a threatened industry, in particular the container terminal business,' Lee said.

He said the challenges included the need for greater liberalisation of cross-boundary trucking services and the provision of additional back-up land for container storage.

The shortage of back-up land had become more acute as Hong Kong terminal operators focused on increasing the volume of transshipment containers to stay competitive with mainland ports. This was because transshipment containers tended to stay longer at port than boxes with direct export and import cargoes.

At the same time, the government had reduced the number of sites for container storage after recently allocating two areas in Kwai Chung to the logistics industry, which Lee said could not afford to develop them.

By reducing the area for container storage the government was hurting the container terminals and not helping the logistics industry. The only people to benefit were the property firms, as they were the only sector that could afford the land, Lee said.

He estimated transshipment accounted for about 60 per cent of Hong Kong's total throughput. That amounted to 11.4 million teu (20-foot equivalent units) in the first half, up 16.1 per cent from a year ago.

But because these boxes were counted twice - on arrival and on departure - the overall throughput figures 'were quite misleading'. So, while Hong Kong is ranked as the world's third-busiest container port, the increase in transshipment meant 'Hong Kong port is doing much worse than it appears to be'.

Lee said existing government and industry channels, including the Port Development Council, have proved ineffective in finding a solution to these difficulties.

He said Secretary for Transport and Housing Eva Cheng, who has responsibility for the shipping and ports sector, was preoccupied by housing issues.

He said the environment facing today's Hong Kong's container terminal operators 'was very different to that 15 years ago', but 'terminal operators cannot get things done'. Pointing to cross-boundary trucking, Lee said it cost an extra US$300 to truck a container from Dongguan to Hong Kong rather than to Yantian container port in eastern Shenzhen. To offset this additional cost, truckers needed to make two cross-boundary trips per day, he said. Trucking companies should also be allowed to use mainland drivers to pick up empty containers or drop off laden ones.

'There is little container terminal operators can do because the government needs to talk to mainland officials,' Lee said.

He said that compared with the United States and Canada or Europe, where truck drivers from the different countries could transport cross-border cargo, Hong Kong was the only place in the world where local truck drivers could make cross-boundary trips but mainland drivers could not.

'I understand these are political issues and the [Hong Kong] government and the Legislative Council do not want to talk about it. But not talking about it does not help Hong Kong,' Lee said.

Under pressure

Cross-border trucking and a shortage of land are testing the industry

The extra cost to truck a container from Dongguan to Hong Kong, rather than to Shenzhen, in US dollars, is: $300