As other ports rise, HK still has much value for shippers

Logistics industry insiders called on Hong Kong to enhance its high-end shipping services, rather than focusing so much on container throughput. Doing so, they said, would burnish its reputation as an international shipping center.

“Hong Kong should provide more high-level shipping services, including maritime arbitration and logistics, to Chinese companies investing in countries along the 21st Century Maritime Silk Road,” said Zhu Hanliang, managing director of Asia Container Terminals, which is based in Hong Kong.

“It’s necessary for Hong Kong to make use of its advantages instead of only paying attention to maintaining the container throughput, which shrank in recent years,” he said.

Hong Kong port had the world’s most container throughput of any port from 1987 to 2004. However, in the past 10 years, it has been overtaken by Shanghai; Shenzhen, Guangdong province; and Ningbo-Zhoushan in Zhejiang province, and now ranks fifth in the world. Some have predicted it will be surpassed by Guangzhou this year.

Ma Danyang, commercial director of Cosco-HIT Terminals (Hong Kong), said the trend mainly arises from the fact that Hong Kong’s nearby ports optimized their infrastructure dramatically over the past two decades — facilities such as Yantian Port in Shenzhen and Nansha Port in Guangzhou — attracting plenty of cargo that otherwise would have been moved through Hong Kong.

M.V. Cosco Netherlands, a container ship that can carry 13,000 containers, left Yantian port on Aug 2 after stopping in Hong Kong port on Wednesday. It set sail from China in late July, heading for Europe.

“We loaded 1,662 TEUs at Yantian and only 926 in Hong Kong,” said Wang Lin, the ship’s chief officer. “Most ships had to stop in Hong Kong previously, but now it’s not necessary. Both Yantian and Nansha ports have enormous berths for huge freighters to stop. However, older machines and equipment in Hong Kong’s port reduce efficiency in loading and unloading.”

Asia Container Terminals’ Zhu said the lower labor and land cost at the two ports also contribute to the trend, which he thought was inevitable.

“So now Hong Kong’s traditional dominance in container throughput is gradually weakening,” he said. “But it can offer high-quality service on maritime arbitration, logistics and other aspects, helping Chinese shipping companies further invest along the 21st Century Maritime Silk Road.”

High value-added shipping service is Hong Kong’s other traditional advantage, including maritime arbitration, marine insurance and ship management.

International law firms in Hong Kong provide legal advice on ship chartering, cargo claims and dispute resolution. According to Hong Kong Trade Development Council, Hong Kong International Arbitration Center handled 297 new arbitration cases in 2016, with 9 percent of those involving maritime disputes.

There were 88 authorized ship insurers in Hong Kong before March, 35 of which were foreign-owned, offering services in loss or damage to ship hulls, machinery and cargoes.

The Hong Kong government also draws attention to its high-end maritime service. It established the Hong Kong Maritime & Port Board in 2016, which takes charge of driving the city’s growth of high value-added and professional maritime services, and helping them with transformation and upgrading.

“Hong Kong has a lot of maritime talent and a leading law system, which should be adopted, so as to promote Hong Kong as an international maritime hub,” Zhu said.