Jun. 22, 2007 (China Knowledge) – Hong Kong should place undivided attention on its expansion as a high-end logistics sector and leave the expansion of container terminals to its neighboring cities in Guangdong, suggested a senior official with the national planning agency.

Zhang Xiaoqiang, deputy chairman of the National Development and Reform Commission, told the sources that a "regional perspective" should be adopted by the authorities to construct prospective new terminals in mainland China. In fact, there is a mounting sentiment among central government officials that Hong Kong should re-evaluate and re-plan its direction towards attaining shipping hub status.

Once the heartbeat of Hong Kong's pulsating economy, the city's container port has been crowned as one of the busiest container ports in the world for fifteen times.

Yet, the curtains may be drawing upon this glorious chapter. After being surpassed by Singapore as the world's busiest port in 2005, the city continued to sink lower in rankings when it was overtaken by Shanghai in April. It is estimated to face another setback next year when it is likely to fall behind Shenzhen.

Furthermore, Hong Kong port has also been confronted with relentless competition from rivals in the region, such as the up-and-coming Yantian Port in Shenzhen, which undercuts Hong Kong through its economical pricing of equally effective service.

Zhang proposed a labor division in the region's logistics flow. There is no need to transfer all export products made in Guangdong via Hong Kong port in order to retain Hong Kong's status as an international shipping centre. This shall lengthen the time and increase the cost of transporting the products.

He added that splitting up cargo throughput to Guangdong would be a win-win situation to both parties because not only has the province's economic growth exceeded that of Hong Kong, but its trade volume had also surged.

Besides, Zhang also suggested the overall management of the new terminals should be granted to Hong Kong-led consortiums so that "Hong Kong can also enjoy the benefit to ship the goods from Guangzhou and Shenzhen directly".

Yet, there have been oppositions about his propositions. Alex Fong Chi-wai, a former secretary of the defunct Hong Kong port and maritime board, said that the authorities cannot execute port planning as it depends heavily on trends in market demand.