A study of the future role of the port of Hong Kong in the Pearl River Region

by Tse, Lan-fong

(Uncorrected OCR) Abstract of dissertation entitled

A Study of the Future Role of the Port of Hong Kong in the Pearl River Region

Submitted by

Tse Lan Fong

for the degree of Master of Arts in Transport Policy and Planning

at The University of Hong Kong

in June 2003

Hong Kong is the world's busiest container port in terms of shipping tonnage and the

port of Hong Kong has been the pillar of Hong Kong's economy. Since 1987, the

throughput has grown eleven times in the last 12 years.

In 2002 Hong Kong had handled 19.1 million Twenty Foot Equivalent Unit (TEU)

containers and this become the rise in container traffic is a positive indication of

Hong Kong's strength as an entreport. However, the total number of sea-going

vessels arrival in Hong Kong decreased by 4.6 percent to 35,620. The total

number of containers handled at Kwai Chung container berths was around 10.1

million TEUs sea-going cargo in 2001, a decrease of 4.8 percent compared with the

year 2000.

For the first time in more than two decades, Hong Kong's container throughput

slipped in 2001, from 18.1 million TEUs to 17.9 million TEUs. The economic

growth rate of southern China is slowing down because of accentuating by the events

of September 11, 2001. More importantly containerise cargo flows continued to

migrate towards the other ports in the Pearl River Delta area, although at present

Hong Kong is China's most important container port, it is increasingly losing some

of its trade to these other ports, particularly Yantian and Shekou.

There is a brief description of the comparative advantages of the Port of Hong Kong

and other ports in the Pearl River Delta Region at the beginning of this study. After

a brief review of the development of the ports in the Region, this study employed the

Porter Theory to analyse the role of the Port of Hong Kong under a rapidly changing

environment and analyse that how Hong Kong's traditional comparative advantage

as an international hub and how this position is being challenged in the recent years

due to the rise of other Pearl River Delta Region ports.

On the other hand, this study then put the concept of CO-OPETITION as a potential

strategy for the port of Hong Kong in rising to the new challenges and suggests a

number of ways to build such a strategy. Reference is made to overseas experience

on some of the key elements that can be employed to support the building of this

strategy.

The findings of this study point to the need to examine the relative strength of the

port to attract shippers, the cargo base, the growth and propensity of cargo that would

be diverted to other ports. This study also concluded that the port of Hong Kong

should reposition itself at the same level of other ports in Pearl River area and

develop a co-operative relationship with other ports, and implement strategies

whereby the port of Hong Kong can share some of the overhead costs, research and

development cost, marketing cost and accounting system cost etc. Therefore all

ports in the region can enjoy a mutual benefit of lowering costs in the business

through risk sharing, in enlarging the market catchments and forming allies against

the competition with other ports in the Asian Pacific, such as Busan and Singapore.

In conclusion, all ports in the Pearl River Delta area, including the Port of Hong

Kong, would be benefit and achieve a win-win situation business environment

through a Co-opetition strategy.