Hong Kong is building up an extensive infrastructure to strengthen its role as the “Gateway to China” and make it more attractive to foreign companies that are keen to use it as an intermediary for forays into China’s huge market.

“The logistics and trading sectors constitute one of the four major pillars of Hong Kong’s economy, and make a 26% contribution to our GDP,” Carrie Chang, the assistant secretary (transport) in Hong Kong’s Transport and Housing Bureau, pointed out.

The other three major “pillars” of Hong Kong’s economy are finance, professional services and tourism.

Hong Kong has already benefited considerably from the Closer Economic Partnership Agreement (CEPA)

signed with China in June 2003.

Describing CEPA as a “win-win” situation for China and Hong Kong, Chang said that the agreement covered three areas such as trade in goods, trade in services, and trade and investment facilitation.

“CEPA also benefits the mainland because Hong Kong serves as a perfect ‘springboard’ for mainland enterprises to reach global markets, accelerating the mainland's full integration in the world economy.  Foreign investors are also welcome to establish businesses in Hong Kong,” she explained.

Hong Kong is conducting a feasibility study on the need for a new container terminal.  “We are doing the dredging work at the Kwai Tsing Container Terminal from 15 metres to 17 metres to accommodate the new generation of vessels,” she said.

 
Hong Kong’s airport is still the “world’s busiest airport”, having handled some 3.35 million tons in 2009, down 7.7% over the previous year.

“However, our airport has reverted to its pre-2009 level of approximately 300,000 tons a month. We have two air-cargo terminals with a total handling capacity of 4 million tons.  If the current trend of 6 to 7% growth continues, we shall need a third new terminal, thus adding another 2.6 million tons and, in the process, creating a total capacity of 6.6 million tons,” she maintained.

Hong Kong airport’s “super terminal” is operated by the Hong Kong Air-Cargo Terminal Ltd. (HACTL) which handled 2.32 million tons or 70% of the cargo traffic while the remaining 30% was handled by Asia Air Freight Terminal.  The airport is also planning to commission a feasibility study to see if a third runway is needed. 
According to Chang, some 70% of cargo handled in Hong Kong is bound for or originating from China.  Fears of Hong Kong losing traffic with direct shipping links being established between Taiwan and China were “exaggerated”.

“Direct links (between Taiwan and PRC) may cause short-term variations but, in the long run, everything is globalized and Hong Kong is going to benefit from it too,” she predicted, adding Hong Kong-Taiwan exchanges would be proactively strengthened and opportunities arising from the enhanced cross-strait relations will be tapped in the future.

Meanwhile, the existing four boundary crossing points with China will have one more in 2018. Some 40,000 vehicles cross over to China, with half of them carrying goods. 

Work on the Hong Kong-Zhuhai-Macau Bridge should be completed by 2015.  This will enable Hong Kong to tap the “excellent opportunities” in the Pearl River Delta (PRD) region, which has a population of 50 million.
On the low-cost competition from other ports across the border and Hong Kong’s rising operational costs, Chang acknowledged that Hong Kong may not be able to compete on costs but it has “top expertise” and a track record of being an efficient port. 

“We offer 450 sailings to some 500 destinations a week and are slightly ahead of the PRD schedules,” she said.  “A box from Guangdong can be shipped from Hong Kong in less than seven hours; clearly a record.  And don’t forget: we don’t just move boxes, we also provide value-added services.  Hong Kong is the only port and airport in this part of the world with international connections,” she said.