Price control rejected

THE Government will not step in to curb rising container terminal port charges because it believes the ports are operated competitively and will continue to grow.

The Acting Secretary for Economic Services, Elizabeth Bosher, rejected calls from shippers, exporters and legislators to set up measures to regulate profits and prices set by terminal operators.

She said container terminal charges in Hong Kong were competitive, and comparable with major trading ports in Japan, the United States and Europe, although 'somewhat higher than countries in the region'.

Legislator Lee Wing-tat urged the Government to set up a regulatory system that would prevent operators from colluding and forcing prices higher.

But Ms Bosher said: 'Hong Kong is virtually unique, since most major ports are operated largely by single conglomerates, which compete only with other ports.' She said new operators were encouraged to join new container ports which prevented cartels and oligopolies.

'For example, the Chinese Ocean Shipping Corporation is a partner in the development of Container Terminal No 8.

'Our proposals for the development of Container Terminal No 9 would also have the effect of bringing in new operators and increasing competition.' According to government forecasts, the volume of freight will grow by eight per cent per year, or 126 million tonnes between now and 1997.

Container traffic is expected to grow 11 per cent a year, from 13 million tonnes to 16 million tonnes.

But legislator Peter Wong Hong-yuen said the figures had been revised down, and doubted the accuracy of the forecasts.

Mr Lee also questioned why charges were higher than regional ports if they were as competitive as the Government claimed.

Ms Bosher said terminal charges were related to development costs and charges on some freight lines were more competitive for a variety of reasons.