Jake's View

Plan for housing - not our dying ports

Letting Shenzhen have our transshipment business will result in the release of a massive amount of prime waterfront land ideal for homes

PUBLISHED : Tuesday, 26 November, 2013, 3:02am
UPDATED : Tuesday, 26 November, 2013, 3:02am

"Transshipment is the last fort of Hong Kong's port business and if we lose that it will mark the end of our port."

Alan Lee Yiu-kwong
HK Container Terminal Operators Association
SCMP, November 25

Mr Lee has thus complained to the Transport and Housing Bureau that ports across the border are illegally taking business from Hong Kong by inciting shipping companies to make false declarations of origin.

I think this is indeed a matter for the bureau to look at very closely but with its Housing hat on rather than its Transport one.

The facts are simple. We are losing our port business in Hong Kong and there is nothing we can do about it other than cover our eyes and say that we cannot see it happening.

The business is going across the border because that is where it naturally belongs, close to the Guangdong manufacturing centres rather than in the middle of a bustling city at the end of a traffic-clogged roadway that crosses a border where rules to protect vested interests add extra costs.

The only reason we ever had a container port is that Guangdong was much further behind on the development path. It has now caught up.

And the only reason we still have a container port is that Beijing is still trapped in commercial inefficiencies. It will not allow foreign carriers to transport cargo from one domestic port to another, a practice known as cabotage. This trade is reserved for China-registered vessels.

But Hong Kong is deemed a non-domestic port for these purposes (sometimes we're China, sometimes we're not, don't ask me). This means that foreign carriers can transship their China cargoes here, which they cannot do in Shenzhen although it would be more cost-effective for them if they could.

Port operators in Shenzhen know it too and they have come up with the solution. "Why don't you declare Hong Kong as your port of origin in your manifests," they tell shippers. "That way it's not trade between two domestic ports. Then you can bring all the business here and save money."

I can understand why Mr Lee is worried about this. Transshipments now account for more than 60 per cent of our port's business and if Shenzhen takes it away then what is left of our port's real export/import business will also soon vanish.

I think it a waste of breath for him, however, to protest that this new practice is illegal. In the first place, to follow all the rules of business across the border is to go out of business. Illegality is the lifeblood of enterprise in Shenzhen.

More than that, he complains to the wrong people. No branch of the Hong Kong government can do much for him.

But most of all, why should it really bother us? Big ports do not belong in the centre of big cities. The only reason Rotterdam still has one is that Rotterdam is only a port. London and New York, however, have long seen their port businesses move out and both cities still thrive. They have found other things to do. So can we.

Guangdong was much further behind on the development path. It has now caught up

There is also a very big bonus in letting Shenzhen have the business. It will free up 2.7 square kilometres of prime waterfront land with excellent transport links right in the centre of our city.

A little reclamation between the terminals (don't need water where there will be no ships) could easily raise this to over four square kilometres.

This alone would be enough for almost all the 470,000 flats our government says it must build but for which it supposedly cannot find land, all of it in relatively open planning at lower densities than existing public housing estates.

So instead of complaining of illegal practices, why don't we help Shenzhen take that transshipment business and start planning now for Kwai Tsing Town?

I recognise there is a bureaucratic inertia here that says what is designated for port must be port.

But what can that inertia say when there is no longer a port business for our port? Must the land be left vacant then?

It is time to start planning now.