Government to Boost Logistics Capabilities to Consolidate HK's Hub Position

The Government will continue to invest in both the hard and soft infrastructures of Hong Kong to boost logistics capabilities so as to enlarge Hong Kong's market share and create more jobs in both the logistics sector and other related fields.

The Secretary for Economic Development and Labour, Mr Stephen Ip, made the above statement today (September 18) at the Air Cargo Forum 2002 (ACF 2002) Welcoming Luncheon hosted by the Hong Kong Logistics Development Council (LOGSCOUNCIL). Adopting the theme of "Hong Kong: Logistics Heart of Asia", the Welcoming Luncheon is the LOGSCOUNCIL's hospitality offer to ACF delegates from around the world. It offers an opportunity for the LOGSCOUNCIL to promote Hong Kong's capabilities in providing speedy, reliable and value for money logistics service.

Mr Ip said, in his capacity as the LOGSCOUNCIL Chairman, that boosting Hong Kong's logistics capabilities was essential not only for consolidating Hong Kong's position as the preferred international logistics hub in Asia, but also for securing existing logistics-related jobs as well as creating new openings for the currently unemployed.

"We fully recognize the importance and potential of the logistics sector in creating jobs and alleviating the unemployment problem in Hong Kong. Our latest figures show that, the transport logistics and warehousing segments provide jobs to nearly 100,000 persons in Hong Kong," Mr Ip said.

"We are therefore actively exploring the business case for building value-added logistics parks, and examining the feasibility of developing a Digital Trade and Transport Network System, which is an open and neutral e-platform for exchange of data among logistics players in the supply chain.

"If these projects are found to be worth pursuing, jobs will be created during the construction phase. But more importantly, the new facilities will offer high value-added logistics services by employing semi-skilled or even low-skilled workers," he said.

Mr Ip noted that the logistics sector in Hong Kong had enormous potential due to Hong Kong's world-class infrastructure as well as its connectivity with the Pearl River Delta (PRD), which is often referred to as the "factory of the world".

"Our container port has been the world's busiest for nine of the past ten years, with an expected growth of 70 % over the next eight years. Our airport has been the busiest in the world for international air cargo since 1996, with an almost 20 % surge in cargo volume so far this year," Mr Ip continued.

"The PRD is the fastest growing, most affluent and most open economic region in Mainland China. It is also Mainland China's single largest GDP contributor, largest exporter and most popular destination for external direct investment. Gifted with this rapidly developing hinterland, we attach top priority to enhancing our connectivity with the PRD - both in terms of transport infrastructure and co-operation between governments.

"We will look beyond our own confines and maximise the scope for co-ordination with other parts of the PRD in developing inter-modal transportation links. New railways, road links, bridges and boundary crossings will be built over the next five to ten years to smooth the flow of people and goods between Hong Kong and the PRD.

"New container port facilities will come on stream within the next two years to cope with the expected increase in container traffic to and from manufacturing centres further up the Pearl River. New facilities at the airport will also be developed to handle increased air freight and passenger flows to and from the PRD.

"To enhance Hong Kong's competitiveness as an air cargo hub, the Airport Authority (AA) has increased the number of cargo stands and will continue to provide more over the next five years to keep pace with growing demands. It also plans to develop a dedicated express cargo terminal to cater for the expanding express cargo market," he said.

"The logistics centre at the Hong Kong International Airport, developed last year for handling high value-added air cargo, is expected to open in the first quarter of 2003, thus providing a significant boost to the logistics capabilities of the airport," Mr Ip added.

The Hong Kong International Airport operates 24 hours a day, thus providing flight connections across time-zones, a vital ingredient in express cargo operations. Nearly 70 international airlines provide 3,900 scheduled flights every week to over 130 destinations around the world, including connections to 40 Mainland cities. Hong Kong has also concluded air services agreements with 50 countries.

"As 70 % of all import and export cargo handled at our airport is from, or destined for, the PRD, the AA is actively seeking to extend the airport's cargo catchment area by improving inter-modal connectivity and enhancing co-operation with other PRD airports," Mr Ip said.

"The building of the Marine Cargo Terminal with on-site one-stop customs clearance service on the airport island last year provides the Hong Kong airport with direct links to over 20 river ports in the PRD.

"Since July 2001, the AA has also participated actively in the 'A5 Forum' which brings together the five major airports in the PRD, namely, Hong Kong, Macau, Guangzhou, Shenzhen and Zhuhai. Participating airports have already reached agreement on enhanced emergency co-ordination and support and joint promotion activities. They have also embarked on joint studies to simplify passenger and cargo handling procedures, with a view to attracting more traffic to the PRD. The setting up of the Forum will help develop the complementary strengths of the airports in the PRD in providing services which connect China with the rest of the world."

Mr Ip also assured that Hong Kong Customs services at the Hong Kong International Airport was one of the most efficient and professional clearance regimes in the world.

"The Air Cargo Clearance System handles large volumes of cargo through a direct electronic interface between Customs and cargo operators for manifests and clearance instructions. The system is being upgraded to further shorten clearance time and to cope with expected increase in demand caused mainly by hub operations and inter-modal transshipment activities.

"Working in partnership with the private sector, the Customs is also developing other measures to facilitate inter-modal cargo transshipment via Hong Kong, including a one-stop clearance system for transshipment cargo to avoid repeated customs checks during import and export at different control points," he added.

The International Air Cargo Forum and Exposition is the premier air cargo industry event organised by The International Air Cargo Association. Organised biennially, the ACF is held in turn in Europe, North America and Asia, providing an opportunity for air cargo decision-makers from around the world to address current industry challenges and opportunities.

This is the first time that Hong Kong hosts this world-class event. The ACF 2002 in Hong Kong is also the largest in scale in the event's 42-year history, with more than 3,000 most senior executives from the global air cargo industry and 250 exhibitors participating.