Hong Kong loses out to Singapore in race to develop Asian shipping hub
OOCL chief says city has failed in bid to develop region's most comprehensive maritime cluster
"In the context of [fostering] a maritime cluster, Hong Kong is no longer able to compete," Tung Chee-chen, chairman of Orient Overseas Container Line, told an industry conference in Singapore. Tung was referring to efforts by Hong Kong to leverage the city's strengths in financial services and shipping support services to shore up the once-dominant maritime business.
With Hong Kong's port caught in a pincer action from rivals on the mainland and in Singapore, the promotion of a maritime cluster - drawing in sectors such as financing, brokering and legal services - has been touted as a way to counter a slump in container traffic.
Tung said the Hong Kong government was doing its job promoting the city's advantages, but this approach differed from that of Singapore, which targeted key companies. "For example, Singapore has targeted many Norwegian companies, convincing them to set up offices in Singapore. With word of mouth, more Norwegian companies flocked in," Tung told business and government figures in the Singapore Maritime Lecture, an anchor event in the city state's annual Singapore Maritime Week.
Tung added that Singapore gained a head start after the signing of the Sino-British Joint Declaration in 1984. "At a time when Hong Kong was surrounded by uncertainties, Singapore attracted many companies," he said.
The efforts by Hong Kong and Singapore to promote maritime clusters, under the shadow of the rise of the mainland's ports, aim to exploit not only the cities' financial services clout, but also their legal system strengths and absence of capital controls.
Tung also admitted that he had been struck by Singapore's forward-thinking in expanding its port infrastructure.
"I'm very impressed with the building of the port in the way that Singapore anticipated future growth. No other countries or ports in the world are contemplating similar investment. Singapore is pulling away from all its competitors," Tung said.
The Lion City, home to the world's second-busiest container port after Shanghai, is spending S$3.5billion (HK$20 billion) to expand capacity at its Pasir Panjang Terminal by half, or 50 million 20-foot equivalent units, by 2020.
"Hong Kong cannot compete because we have a different land policy. In that respect, we're a bit detached from reality in the sense that we cannot do the things we want to," Tung told the South China Morning Post on the sidelines of the conference.
Hong Kong, once the world's busiest container port, has slipped down the rankings, trailing Shenzhen in fourth place last year.