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Following is the opening address by the Secretary for Economic Services, Mr Stephen Ip, at the Tripartite Shippers' Councils meeting at Renaissance Harbour View Hotel today (Tuesday):
Mr Chan, distinguished delegates, ladies and gentlemen,
It gives me great pleasure to open the meeting of the Tripartite Shippers' Councils this morning. The meeting brings together three of the most influential shippers bodies in Asia, namely the Hong Kong, Japan and Korea Shippers' Councils. I understand that this meeting has been held for many years and has proved to be a very useful forum for shippers in the region to keep in touch and exchange views on issues of common concern.
I am especially pleased that the meeting is being held in Hong Kong this year. It coincides with the opening of our new airport yesterday which represents a major effort by the Government to maintain and strengthen Hong Kong's position as the transportation hub of the region. Hong Kong is fortunate enough to be situated right next to the Pearl River Delta, one of the fastest growing economic areas in the region. The strong export and import demand of the numerous manufacturing centres in the Pearl River Delta has supported the rapid growth of Hong Kong as the main port for Southern China.
For six years Hong Kong has maintained its position as the biggest container port in the world, handling 14.5 million TEUs of containers last year. We are also the world's largest international air freight centre. Despite space constraints and limited facilities, our old airport at Kai Tak handled 1.79 million tons of air cargo in 1997. We have paid great attention to the air freight business when planning the new airport. The Super Terminal 1 air cargo centre at our new airport involves an investment of US$1 billion and is equipped with the latest technology to handle 2.4 million tons of cargo a year. Together with the other cargo terminal and a special Express Cargo Centre, the first phase of the new airport can handle up to three million tons of air cargo each year.
On the sea transport side, we are concluding our negotiation with the developers for the construction of a new container terminal, CT 9 on Tsing Yi Island, opposite the existing eight terminals. Construction work for the new terminal will begin later this year and the first berth is expected to come into operation in late 2001. The new terminal will have six berths and is designed to handle 2.6 million TEUs a year when fully completed in around 2004. Consistent with our non interference principle, we believe that market forces are the most effective and efficient means to regulate quality of services and charges. The new terminal not only will increase our container handling capacity but more importantly it will also bring in a new competitor. Through increased competition we hope to see better service to shippers and a lowering of container handling costs.
In addition, we are building our first river trade terminal in Tuen Mun which is situated at the mouth of the Pearl River estuary. The terminal is designed to improve the efficiency of our container port by consolidating the river trade cargoes coming down from the Pearl River Delta before feeding them to the Kwai Chung container terminals or mid stream operations for transfer to the ocean going vessels. The first phase of the river trade terminal will begin operation in October this year. It will have a capacity to handle 1.3 million TEUs river trade containers a year when fully completed in late 1999. The new facility not only will help to reduce congestion on the roads and boundary control points between Hong Kong and the mainland, but it will also help to extend the cargo source of the Hong Kong container port to those places in the Pearl River Delta which are less accessible by road.
Now I would like to turn to an issue raised in Mr Chan's speech and that is Terminal Handling Charge. As we all know THC is a complicated matter. I must say I share the concern of the shippers about high THC in Hong Kong. While we appreciate that THC is a commercial issue, we are aware that a consistent high level of THC will in the long term undermine Hong Kong's competitiveness as a port and as a major trading centre. In the end, not only the shippers but the shipping lines and terminal operators will be affected. We are getting this message across to the shipping lines and the terminal operators. To tackle the problem, I consider that, as a first step, we must seek to increase the transparency and encourage more consultation between shipping lines and shippers in the setting of THC. We have received some positive response from the liner associations and I hope we can find an amicable solution to the problem through the exercise of goodwill by all parties concerned.
In closing I congratulate the Hong Kong, Japan and Korean Shippers' Councils on their excellent arrangements for this conference. I also extend a very warm welcome to the observers from the Ministry of External Trade and Economic Cooperation of the Peoples Republic of China, the Federation of ASEAN Shippers' Councils, the Singapore National Shippers' Council and the Macau Shippers' Association. I wish you all a very successful conference, and hope you can find time in your busy schedule to enjoy the many sights and activities offered by our beautiful and dynamic city.
Thank you.
End/Tuesday, July 7, 1998
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