Main transport firms are pulling out of Hong Kong because it loses its standing as a free, worldwide container port, in response to analysts, who blamed a current political crackdown and structural adjustments for the event.
“Hong Kong is being quickly deselected from the East-West trades by all main transport strains,” the Danish-based consultancy Sea-Intelligence stated in an April 2 report citing current knowledge from transport strains.
Complete container volumes coming via Hong Kong fell to 14.3 million TEUs in 2023, the bottom quantity since 1998.
Whereas the decline was exacerbated by the closure of Hong Kong’s borders in the course of the COVID-19 pandemic restrictions, slicing off cross-border highway hyperlinks and prompting transport strains to ship containers straight to Shenzhen, political components together with the worldwide response to town’s ongoing crackdown on dissent within the wake of the 2019 protest motion additionally performed a job, in response to trade analysts.
“Hong Kong loved a particular relationship with the USA and different international locations, as a result of it was seen as semi-independent and autonomous, with little interference from mainland China in its day-to-day operations,” Tom Derry, Chief Government Officer on the Institute for Provide Administration, advised RFA Cantonese in a current interview. “That is now not seen because the case.”
“Overseas nationals, each U.S. and from different international locations, have been arrested below costs because of the new Nationwide Safety Regulation,” Derry stated. “The rule of legislation in Hong Kong is seen as being somewhat extra arbitrary in the present day than it was previously, as a result of nationwide safety instances can solely be heard by specifically appointed justices in Hong Kong, not by the primary judicial system.”
“So Hong Kong’s … particular standing as a most popular port has been eroded. It is to the detriment of Hong Kong and to the advantage of different mainland Chinese language ports.”
On Jan. 18 RFA Cantonese shot footage of the No. 9 Container Terminal at Kwai Ching, which was as soon as stacked with containers a number of excessive, and which is now an empty expanse of concrete.
In keeping with Derry, Hong Kong was hit by the loss in Might 2020 of its separate buying and selling standing beforehand accorded by the U.S. authorities — a transfer that was in direct response to the crackdown on the 2019 pro-democracy motion — and by tariffs imposed on expertise merchandise amid a Sino-U.S. commerce battle begun below the Trump administration.
“Mainland China has 38% market share, the biggest on the planet, in these explicit sorts of companies,” Derry advised RFA Cantonese in a current interview. “Hong Kong loved a big quantity of built-in circuits that had been transferring to these [electronics] companies in mainland China after which transferring from these mainland China companies again via Hong Kong and to their final locations all over the world.”
“That has been considerably impacted by the elimination of preferential standing, and by the later imposition of tariffs … which has solely made these situations somewhat bit worse,” he stated.
Derry stated Indonesia, Singapore and Manila can be vital beneficiaries of the shift away from Hong Kong, together with Manila because of a major semiconductor presence within the Philippines.
“These would be the beneficiaries, and will probably be Hong Kong’s relative loss,” he stated.
In the meantime, a current community overview from the Gemini Cooperation transport alliance of Maersk and Hapag-Lloyd, revealed no direct deep-sea calls in Hong Kong because the alliance pivoted to utilizing Shanghai, Ningbo, Yantian, Singapore and Tanjung Pelepas as main hubs on regional container transport routes, downgrading Hong Kong to the standing of “feeder” port with cargo trucked or shipped to Yantian within the neighboring mainland Chinese language metropolis of Shenzhen.
Hong Kong is not the one port that can lose direct connectivity below the Gemini community: the northeastern Chinese language port of Dalian, Taiwan’s Kaohsiung and South Korea’s Busan have additionally been downgraded.
But the harm to its standing as a global container port will probably be in depth, with town’s port dropping throughput site visitors from Hapag-Lloyd of round 615,000 20-foot-equivalent models (TEU) 1 / 4 and round 261,000 TEUs 1 / 4 from Maersk to Yantian, in response to U.Okay. maritime consultancy MDS Transmodal.
Consolidating routes
The developments come because the Alliance, which teams South Korea’s HMM, Japan’s Ocean Community Specific and Taiwan’s Yang Ming transport strains, is slicing the variety of direct port calls it makes to Hong Kong from 11 to simply 6, Sea-Intelligence reported.
Hong Kong will solely be included on certainly one of Yang Ming’s 13 regional and trans-Pacific routes from 2025, in response to a press launch printed to Yang Ming’s web site.
The consolidation of routes “doesn’t bode properly for the Port of Hong Kong,” Sea-Intelligence commented in its report. “Evaluation of community design and community effectivity will present that fewer, however bigger, hubs are economically extra environment friendly. Hong Kong seems to be the primary main ‘sufferer’ of this.”
Hong Kong’s Transport and Logistics Bureau issued an announcement in response to RFA Cantonese reporting on the problem on April 5, calling it “unreasonable.”
“Radio Free Asia’s unreasonable feedback on the fast deterioration in Hong Kong’s standing as a global transport hub don’t have any foundation in actual fact and have been fabricated out of skinny air,” a spokesman for the bureau stated in an announcement.
“That is wanton criticism and assault … and might by no means be accepted.”
Declining numbers
It cited the Xinhua-Baltic Worldwide Transport Centre Growth Index Report（2023), a collaboration between China’s state information company Xinhua and the Baltic Trade, which claimed that town ranks fourth on the planet as a global container port.
Nevertheless, Lloyd’s Listing ranked Hong Kong tenth on the planet when it comes to throughput final 12 months, one place decrease than in 2022.
Monetary commentator Joseph Ngan, a former assistant controller at Hong Kong’s i-CABLE Information, wrote in a current commentary for RFA Cantonese that Hong Kong has certainly “misplaced its function as an entrepôt port,” citing figures that confirmed a 0.8% decline within the metropolis’s exports within the 12 months to Feb. 29, 2024 and a 1.8% decline in imports, “far worse than market expectations.”
Ngan cited knowledge from the Hong Kong Maritime and Port Board, which reveals that the throughput of Kwai Tsing Container Terminal, which accounts for 70% of Hong Kong’s complete cargo quantity, fell for 25 consecutive months to the tip of December 2023, the biggest decline on report.
Complete throughput fell by practically 14% for the entire of final 12 months, Ngan wrote, citing an additional double-digit decline in February following a short spike forward of the Lunar New Yr vacation in January.
Hong Kong’s greatest container terminal operator, CK Hutchison, noticed a 9% lower in its China-Hong Kong port income and a 18% fall in its gross earnings final 12 months, Ngan wrote.
“We have now seen that the rating of container terminals has dropped from No. 1 on the planet 20 years in the past to the underside of the highest 10,” Ngan wrote. “It’s clear from the info that container throughput has plummeted.”
He stated Hong Kong officers had been selecting to disclaim the issue in favor of issuing constructive propaganda concerning the metropolis’s outlook as a substitute.
Translated by Luisetta Mudie.
