HONG KONG: History has shown that the decline of a business or an industry often starts with subtle shifts in trends that seem innocuous or even favourable at the time. Yet, when those trends snowball into immovable obstacles, we inevitably wonder why nothing was done to address the issue when it could have been easily managed.
Hong Kong’s port industry faces such a crossroads, either to prosper by maximising the use of its existing Kwai Tsing port facilities or to stop investing and watch shipping lines move their ship calls to other regional ports. The Kwai Tsing container terminals finished the first quarter of 2015 down 9.8 per cent in throughput year-on-year, with March recording a rare double-digit drop of 16.2 per cent year-on-year. It also marked nine consecutive months of year-on-year fall in throughput.
Fortunately, studies commissioned by the government in 2004 and 2014 arrived at essentially the same set of key measures that can safeguard the industry’s competitiveness for the foreseeable future. These include enlarging the container terminal yard storage areas, adding barge berths and allowing the rationalisation of existing on-terminal facilities.
According to the findings of a study on the strategic development plan for Hong Kong port to 2030, its long-term competitiveness and sustained growth are under threat due to several growing trends that undermine our handling capacity. One is the sharply increased deployment of mega container vessels to call at hub ports. Their size and high volume of cargo combine to drive down container handling volumes per vessel-call due to insufficient yard capacity, resulting in lower productivity and terminal congestion.
A second trend affecting the port’s handling capacity is the substantial increase in barge traffic as more cargo containers are being handled by river barges, rather than through inland transport. In 2008, the average barge waiting time at the Kwai Tsing container terminals was about two hours; now it can take more than two days during peak periods. For container vessels, the average waiting time has risen from 2.8 hours to up to 13 hours at congested periods.
A third trend identified in the 2014 government-commissioned study is the port’s increasing reliance on international transshipments. These have strained handling capacity as the efficient movement of containers across terminals has been undermined by limited yard space.
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