Aviation article(s)
April 17, 2018

The Hong Kong government and the Hong Kong Trade Development Council (HKTDC), the special administrative region’s trade promotion agency, are organizing a summit to pitch Hong Kong’s role in China’s Belt and Road Initiative (BRI) to business sectors such as banking and finance, logistics and maritime, professional services, infrastructure development, international trade, and manufacturing.


The BRI Summit will take place June 28 in Hong Kong.


Benjamin Wong, the head of transport and industrial affairs at InvestHK, Hong Kong’s investment promotion arm, recently visited New York to highlight the features of the multilateral BRI project before potential attendees.


“The BRI is a long-term multilateral project, supported by China. The 2018 summit will have a roster of high-profile speakers not only from Hong Kong and mainland China but also from around the world,” Wong said in an interview with Asia Cargo News in New York.


Hong Kong has been vigorously expanding its infrastructure, including roads, rail links and ports to capitalize on the business opportunities arising from the BRI project. Wong pointed out that a 26 km high-speed road link stretching from Hong Kong to Shenzhen would directly connect with China’s 22,000 km road network.


The Asian Infrastructure Investment Bank (AIIB) is involved in the financing of the new BRI projects, including in sectors such as energy and power, transportation and telecommunications, rural infrastructure, logistics and urban development.


The BRI aims to connect Asia, Europe and Africa along five routes. The BRI’s focus lies on: (1) linking China to Europe through Central Asia and Russia; (2) connecting China with the Middle East through Central Asia; and (3) bringing together China and Southeast Asia, South Asia and the Indian Ocean.


Wong was confident that US companies would become interested in the BRI project. “After all, investors go wherever there is a good proposition,” he said.


Hong Kong is trying to capitalize on its strengths in four major areas: financing and investment, infrastructure and shipping, economics and trade, and dispute resolution services. Development of the Guangdong-Hong Kong-Macau Greater Bay Area has been a priority.


Self Photos / Files - Hong Kong Star Ferry HKTB


Hong Kong is sharpening its profile as a global offshore Renminbi market as well as a professional service provider for infrastructure projects and a hub for international dispute resolution; this, as Wong said, will serve as an asset in dealing with some of the intricacies that characterize the gargantuan BRI project. Some experts estimate that the total worth of the BRI project exceeds, at this point, US$800 billion.


Joanne Chu, director of the Hong Kong Economic and Trade Office in New York, speaking during an earlier presentation organized by the Hong Kong Association of New York, also highlighted the advantages BRI offered to US companies. Indeed, Kevin Logan, HSBC’s managing director and chief economist, global research/Americas, told Asia Cargo News that the banking sector took a positive view of the BRI project. “I can speak for the HSBC which is optimistic about it,” he said.


With Hong Kong, a top player in container shipping, recording a volume of 20 million TEUs in 2017, the port has made investments to become fully automated, according to Wong.


Hong Kong is building up its infrastructure for temperature-controlled transport. With demand for fresh produce and pharmaceutical products rising both in Hong Kong and China, Hong Kong has already positioned as a transit hub for perishables such as fresh produce, frozen ready-to-eat foods and pharmaceuticals.


While Hong Kong’s own consumption of perishables and pharmaceuticals is not as large as China’s market, consumption of perishables remains relatively high. Thanks to its strategic location in Asia, its proximity to China and its existing infrastructure for temperature-controlled transport, Hong Kong is well positioned to provide its services in this sector, Wong maintained.


But foreign operators are also keen to tap the mainland market. DB Schenker, a leading logistics player, for example, has already positioned itself in the sector of cold chain operations in China. It has signed a partnership agreement with Sichuan JiuYe of Chengdu, a food trading company.


DB Schenker is developing its integrated logistics solutions in China, which presently include domestic trucking, contract logistics for temperature-controlled warehousing, air and rail exports to Russia and Eastern Europe, and imports from Australia, North America and Europe.


There are several commodities driving China’s record cold chain growth. For example, China’s fresh fruit import volumes have grown 20% year-on-year since 2014, while meat imports touched record levels last year, with Australia, Brazil and Uruguay emerging as the leading suppliers. The US could very soon start the resumption of its supplies after the 2013 import ban on US beef following the BSE outbreak, was recently lifted.


Hong Kong International Airport, which is also building a new air cargo logistics centre, has also stepped into the temperature-controlled transport business. HKIA’s overall air cargo tonnage volume in 2017 touched 4.94 million tonnes, a 9.2% increase over 2016; air mail accounted for some 112,000 tonnes, with the total cargo and air mail throughput exceeding 5 million tonnes for the first time.


The airport has joined a select group of airports that have been recognized by the International Air Transport Association (IATA) for their standards in transporting pharmaceuticals.


IATA has recognized HKIA as a partner in its Center of Excellence for Independent Validators in Pharmaceutical Logistics (CEIV Pharma).


The IATA-CEIV Pharma Certification Programme, a globally recognized and standardized certification for pharmaceutical air freight shipments, is designed to help the industry develop a network of certified pharmaceutical trade lanes that comply with cold chain management standards and assure product integrity.


HKIA’s three cargo terminals (Asia Airfreight Terminal Limited, Cathay Pacific Services Limited and Hong Kong Air Cargo Terminals Limited) and three ramp handling operators (Hong Kong Airport Services Limited, Jardine Aviation Services Limited and SATS HK Ltd), along with a local base carrier, Cathay Pacific Group, achieved the certification.


“Pharmaceutical air cargo shipments have a strong market outlook, and the CEIV certification will bolster HKIA’s position while continuously enhancing its air cargo facilities,” Wong said.



By Manik Mehta

International Correspondent | New York

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