Lack of space and facilities holding back Kwai Chung

PUBLISHED : Wednesday, 18 January, 2012, 12:00am
UPDATED : Wednesday, 18 January, 2012, 12:00am


Poor land-use planning coupled with a shortage of logistics facilities could limit the capacity of Kwai Chung's container terminals and air cargo operations, say experts.

Hong Kong has increasingly become a transshipment hub for Chinese and other Asian cargo rather than an origin and destination centre. As a result, more space is needed for the development of distribution centres serving Asian markets and to provide capacity to handle transshipped containers that spend more time in port than originating cargo.

Around 60 per cent of the cargo handled by Hong Kong's port in 2010 - equivalent to 13.1 million teu (20-foot equivalent) units - was transshipment cargo, with 39 per cent exports and imports from southern China. This compared with around 55 per cent of the container throughput in 2007. Transshipped containers can stay in port for a week waiting for their next sailing whereas export or import cargo may spend less than two days in port.

Jonathan Beard, managing director of GHK (HK), noted that the 2020 Hong Kong port master plan study carried out in 2004 for the Port Development Council said it was vital to provide additional land around Kwai Chung and Tsing Yi for container terminals and related uses as a first priority and that in the short term this would provide additional capacity at lower overall cost.

But he said progress in finding this extra land had been limited by the 'piecemeal approach to logistics land planning and desire to maximise returns to treasury'.

Instead, he called for a city-wide approach 'to balance the need for value-added logistics facilities and warehouses with [the] need for land adjacent to container terminals to maximise port capacity'. He said the 2020 study identified a need for between 32 and 113 hectares of extra land to ensure maximum capacity at the nine Kwai Chung terminals.

A 2030 port master plan is being carried out by a consultancy team led by BMT Asia. The study is due to be handed to the Transport and Housing Bureau in July.

Echoing Beard's views, Edward Lau, managing director of TNT Express Hong Kong, said: 'There needs to be a more balanced use of land to help the logistics sector.'

He pointed out there were insufficient distribution centres and depots in Hong Kong, facilities which will be crucial if the city is to compete with other centres in the region.

TNT Express opened a 9,205 square metre distribution centre within the ATL Logistics Centre at Kwai Chung to support its key big-brand fashion customers, which rely heavily on airfreight to supply stores throughout Asia. Lau said it was 'very difficult' to find such a large facility, adding that it was full within four months of opening last August.

Chinese University and BMT are working on a study for the Trade Development Council of whether more distribution centres are needed. Logistics and other firms have been asked to complete a questionnaire for the study, to be finished in April.