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LCQ4: Development of Hong Kong maritime, aviation and logistics industries
     Following is a question by the Hon Frankie Yick and a reply by the Secretary for Transport and Housing, Professor Anthony Cheung Bing-leung, in the Legislative Council today (June 14):


     The trading and logistics industry is one of Hong Kong's four key economic pillars, with its economic contribution accounting for more than 20 per cent of the gross domestic product and nearly 750 000 people being employed by it. However, the container throughput of the Hong Kong Port has shown a downward trend in recent years. Moreover, it has been reported that the Secretary for Constitutional and Mainland Affairs said in April this year that in order to avoid vicious competition among cities in the Guangdong-Hong Kong-Macao Bay Area (the Bay Area), Hong Kong might have to give up some of the industries in which it had no advantage (e.g. terminal cargo transportation) and should direct its development towards high value-added industries. In this connection, will the Government inform this Council:

(1) whether it has discussed with the authorities of the other 10 cities in the Bay Area the formulation of a plan for the work division and cooperation relating to the freight transport industry;

(2) as the Government has indicated that it will submit its views on the planning of the Bay Area to the National Development and Reform Commission at the end of this month, whether such views will include proposals for the development of Hong Kong's freight transport industry; if so, of the details, and whether it has conducted any assessment on the impact of these proposals on the freight transport industry, the local economy and the labour market, and whether it will consult members and bodies of the relevant industries before submission of the proposals; and

(3) as three of the 10 busiest ports in the world are located in the Bay Area and there are also five civil airports in the area, what plans the Government has in place to further support and consolidate Hong Kong's status as a regional logistics and aviation hub and to facilitate Hong Kong's trading and logistics industry to play a leading role in the economic development of the Bay Area?



     The Guangdong-Hong Kong-Macao Bay Area (the Bay Area) development plan is one of the important regional development plans under the National 13th Five-Year Plan and the Belt and Road Initiative. It helps to promote the co-operation and development of Hong Kong, Macao and the nine cities in the Guangdong Province in areas such as trade and logistics, professional services and technology innovation, as well as the connectivity of transportation infrastructure. The Hong Kong Special Administrative Region Government will participate in the planning work of the Bay Area under the principles of "one country, two systems", complementarity and mutual benefits, leveraging on Hong Kong's advantages, its position as a major international metropolis, as well as our open and leading role to complement and co-ordinate with other cities in the region and develop the Bay Area into a competitive world-class city cluster. 

     Our consolidated reply to the three-part question raised by the Hon Frankie Yick is as follows:

     Hong Kong is a major hub port in South China, with approximately 80 per cent of the import and export goods in value being Mainland-related. The container throughput of Hong Kong Port (HKP) last year was close to 20 million TEUs, two-thirds of which was related to the Pearl River Delta (PRD). Hong Kong International Airport (HKIA) is the world's busiest cargo airport for seven consecutive years, and its air freight throughput exceeded 4.5 million tonnes last year, of which 70 per cent was roughly estimated to be originated from or destined for PRD, demonstrating the close connection of the freight industries in Hong Kong and the Bay Area. With further development of PRD, there is ample room for Hong Kong to grow further. Hong Kong should regularly assess our differentiation and advantages, and enhance our overall competitiveness, in order to achieve the objective of catering for the needs of the country and region with Hong Kong's strengths. 

     At present, HKP and the various ports in the Bay Area have their own distinctive roles and positioning. While HKP is a distribution centre for goods in South China and a major transshipment hub in the region, other major ports in the Bay Area (for example, Shekou, Yantian and Nansha, etc.) are mainly involved in handling direct cargo, and hence there is no question of abandoning HKP. Although there is no concrete co-operation plan on freight between Hong Kong and other cities in the region at present, with the further development of the Bay Area, the various ports will, under the principle of complementarity, develop their respective strengths to enhance the logistics capacity of the whole region. Hong Kong will continue to reinforce its function as a transshipment hub and, at the same time, actively develop high value-added maritime services, so as to better serve the role as the "super-connector" between the Mainland and the rest of the world. 

     The Government has consulted the industries and respective advisory committees on the development plan of the Bay Area and submitted its recommendations to the relevant Mainland authorities, which have laid out the positioning of Hong Kong as a major international metropolis, as well as its competitive edges as international financial, transportation and trade centres and a professional services cluster.

     On maritime front, we are committed to consolidate Hong Kong's status as an international maritime centre, and to actively foster the development of HKP and high value-added professional maritime services, with a view to providing high quality maritime services to the maritime enterprises in the Bay Area to assist them to "go global", as well as to attracting overseas enterprises to use Hong Kong's services and regional headquarters positioning to access the Mainland market. 

     On aviation, currently there are about 1 100 daily flights connecting Hong Kong to around 190 destinations worldwide, including some 40 destinations in the Mainland.  We are committed to consolidating Hong Kong's position as a leading international and regional aviation hub. With the policy support of the Central Government, we are taking forward the Three-Runway System Project and will enhance co-operation and co-ordination with other major airports in the region.

     The Government has implemented a number of measures to complement the above-mentioned "consolidation" strategies, which include:

     First, the deepening of the Kwai Tsing Container Basin from 15 metres to 17 metres has been completed to enable ultra-large container vessels to access the terminals at all tides. More port back-up sites are also made available in phases to expand the terminal back-up yard and provide additional barge berths to enhance cargo handling efficiency.

     Second, additional land is provided for the development of modern logistics. Since 2010, the government has provided a total of 6.9 hectares of logistics sites and reserved two sites with a total area of some 10 hectares in Tuen Mun West. At the same time, the Airport Authority (AA) has reserved about 20 hectares of land in the South Cargo Precinct of the Airport Island for supporting the development of transshipment, e-commerce and high value-added air cargo services.

     Third, when the Three-Runway System of HKIA commences operation, the airport will be able to handle about 9 million tonnes of cargo annually, which will nearly double the current cargo handling capacity. Before the completion of the Three-Runway System, the AA has implemented a number of facility enhancement and expansion measures to enhance the cargo handling capacity. 

     Moreover, the Hong Kong-Zhuhai-Macao Bridge, which connects Guangdong, Hong Kong and Macau, will significantly shorten the travelling time between Zhuhai and the Kwai Tsing Container Terminal and HKIA upon commissioning. Cargo originated from western PRD can make better use of Hong Kong's airport and container port, thereby generating more business opportunities for our logistics industry. 

     We hope that, riding on Hong Kong's high value-added trade and professional services, world-class infrastructure and manpower development, as well as the global connectivity of an international metropolis, Hong Kong will play an important leading role in the Bay Area development.
Ends/Wednesday, June 14, 2017
Issued at HKT 14:30
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