Hong Kong Port Sees Rivals On Horizon

But if peace has broken out over the worlds largest port, the battle for regional trade is entering a fiercer phase. Chinas call last month for direct shipping links with Taiwan, though part of a complex political game, threatens to shift cargoes from Hong Kong. The challenge is strengthened by rising competition from Singapore and South Korea to the emerging ports along the southern Chinese coast.

The reaction of Taiwanese industry to Chinas overtures demonstrates the growing rivalry. Taiwans major container shippers are gearing up to take a share in Chinas trade, said Yang Ming Marine. Taiwan could become a transhipment centre for the mainland, the company claimed.

 

For Hong Kong, the entrepot for Taiwan-China trade, this threatens upheaval. Taiwan-China container trade passing through the territory reached about one million TEUs (20ft equivalent units) last year, compared with total throughput of 12.6 million TEUs.

The territorys Port Development Board estimates direct shipping ties between Taiwan and China would result in the loss of about 900,000 TEUs of this trade within a few years.

There are still many obstacles to cross-straits shipping, in the short term at least. Taipei is resisting direct trading ties, until Beijing makes political concessions. The question of flagging of vessels and other delicate issues of sovereignty must also be overcome.

But the process appears inexorable, if only because Hong Kongs return to Chinese sovereignty next year undermines the pretence of indirect trade between Taiwan and the mainland. And once direct ties are established, Taiwan will eye much more than the existing commerce flowing through Hong Kong.

Taiwan argues that its ports offer savings over Hong Kong for shipments between going to determine whether Hong Kong stays ahead of the rivals in its wake.