To develop Hong Kong into a stronger logistics base, the Government has identified three areas to be strengthened, Hong Kong Port and Maritime Board (PMB) secretary, Alex Fong, says. Since the formation of the Committee on Logistics Services Development under the board in March to improve logistics services, physical infrastructure was identified as one area for improving logistics. 'We have set up a sub-committee to look at the logistics facilities in Hong Kong and the inter-relations between them,' Mr Fong said, adding that the sub- committee would also see what the SAR should do in the future, including opportunity and timing of logistics activities. Logistics is defined as a management science which embraces the efficient movement and storage of goods, and provision of services. Its scope extends from manufacturing to final delivery, including related aspects of information technology and other control systems, also known as supply chain management. Although the SAR has one of the finest transport infrastructures in the world, the sub-committee will study how to better utilise and upgrade the existing infrastructure. It will examine the precise movements of cargo by rail, road, sea and air in and out of Hong Kong. The panel, which is headed by Swire chairman James Hughes- Hallet, hopes to identify not only the problem areas but also opportunities that can be exploited. Some committee members believe that better use can be made of the Lantau expressway that links the airport and the Kwai Chung container port. The second area to be improved is the regulatory infrastructure such as those that involve the Customs and Excise Department, which has seen much improvement recently under its aggressive Commissioner, John Tsang Chun-wah. The sub-committee dealing with this issue will allow various groups to provide input to the department. Another area to be examined is the information technology infrastructure, considering that there have been many complaints that it is not well developed. Other issues that will be considered are streamlining red tape and replacing paper-based systems with IT systems. The committee will find ways to improve the environment for electronic commerce to flourish, and to implement programmes that can monitor freight movements for possible reduction of inventory and warehouse costs. Mr Fong said the sub-committee related to this issue would also address the question of better training. While the will to improve the cyber highway and links is there, the question is how to do it, he said. The third area to be looked at by another panel is the long term competitiveness of Hong Kong. This involves looking at resources, how various parties can co-operate and produce adequate manpower. This will include examining whether or not there are sufficient training courses and facilities to train the thousands of people who work in this sector. It will examine whether a career in logistics is an attractive proposition for the next generation. He said the industry agreed there was a need to work more closely to enhance Hong Kong's competitiveness. Reeling from the effects of the Asian financial crisis that started in mid-1997, and the rising competition from neighbouring coun tries, Hong Kong was forced to promote its expertise abroad, something the territory has never done before. The PMB and the Hong Kong business community made concerted efforts through several promotional trips to Asian countries, the United States and Europe to 'sell' the SAR as an international logistics hub and a leading financial centre. Mr Fong said the findings of these sub-committees would be analysed together with the Port Development Strategy Review that would look at the supply side and the Port Cargo Forecast that would look at the demand side. Between now and next year, the committee will also take into account the value-added aspects of the supply chain management to see how they can fit in the context of the Hong Kong through train to southern China, he said. As 80 per cent of cargo in southern China comes to Hong Kong, the intermodal transportation link will be considered. A consultancy study will be carried out at the beginning of next year to carry out a benchmark study of Hong Kong's position as an international logistics hub vis-a-vis its counterparts in Europe, the US and Asia. According to Hong Kong Port and Maritime Board acting secretary Roger Tupper, the consultant will be appointed to study institutional arrangements in the SAR. 'The study will determine whether there is a need to strengthen these institutional arrangements and whether they can do something for logistics development,' he said.