HK, Singapore battle on as rival ports

HK, Singapore battle on as rival ports

SINGAPORE (AFP): Old rivals Hong Kong and Singapore will
battle on to be the world's busiest port beyond the territory's
handover to China next week, but both also have a fight on their
hands from emerging competitors, analysts say.

Asia's two premier shipping hubs have for long been engaged in
a ding-dong race to be the world's top container port, an honor
Hong Kong snatched in 1992 and has held ever since, profiting
from China's economic boom.

Last year, the Hong Kong port handled 13.41 million TEUs
(twenty-foot equivalent units) and Singapore 12.94 million TEUs.
The gap narrowed from 680, 000 TEUs in 1995.

"This big race for the most TEUs will continue. Old rivalries
die hard," a shipping analyst with a Western investment house
said here ahead of Hong Kong's July 1 transfer to China.

But more interesting for industry watchers would be how the
two ports tackle emerging competition, the analyst said.

Richard Stokes, director of regional marine research at
investment house WI Carr, said the establishment of direct
shipping links between Taiwan and China starting in April posed a
strong challenge to Hong Kong.

"That will have a more immediate medium-term influence on
shipping channels," Stokes said, adding that the emergence of
satellite ports in Singapore's neighborhood would also "make
their influence felt" in time.

Despite fighting keenly for the position of the world's number
one container port on the back of their strategic locations, Hong
Kong and Singapore do not compete directly for the same cargo.

Hong Kong serves as the principal gateway for Chinese foreign
trade, handling 30 percent by volume and 60 percent by value of
the mainland's booming imports and exports which swelled to
us$386 billion last year.

Singapore, sitting astride one of the world's busiest sea
lanes, acts as the trading and distribution hub for fast-
expanding Southeast Asia, linking the region to the rest of the
world.

Hong Kong and Singapore may be in no immediate danger of
losing their status as regional hub ports, but cargo-hungry
competitors are building up their container handling capacity and
are hot on their heels, analysts said.

"They will definitely remain as hub ports but their market
share will decline," Andrew Penfold, director of the UK-based
Ocean Shipping Consultants, told Singapore's Shipping Times here.

Asian economies have been pumping massive investments into
port development in competition for rapidly growing cargo traffic
while liners, shippers and manufacturers look for cheaper
alternatives.

Hong Kong's strongest competition is seen to come from the
Taiwanese port of Kaohsiung even as Taiwan and the mainland move
to expand the limited shipping links they established in April.

China is developing several new ports, having spent more than
eight billion dollars since 1985 on port and port-related
infrastructure. Its container traffic is expected to grow to 10
million TEUs by 2005 from 4.5 million TEUs in 1996.

Shanghai has beefed up its port infrastructure and could
become a container shipping hub in its own right, experts said.

In Singapore's neighborhood, Indonesia, the Philippines,
Malaysia and Thailand are developing ports to attract
transshipment traffic and help reduce their dependence on the
city-state.