XN000022-1991-11-20 — Page 10

WEDNESDAY, NOVEMBER 20, 1991

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SUCH DEPTHS CAN ONLY BE REALISTICALLY PROVIDED IN THE KWAI CHUNG/TSING YI AREA, IN SEVERAL LOCATIONS AROUND LANTAU, AND IN TOLO PBOUR. TSEUNG KWAN O IS NOT SUITABLE FOR LARGE CONTAINER VESSELS AND IN ANY EVENT HAS TOTALLY INADEQUATE INFRASTRUCTURAL SUPPORT.

IT AGAIN,

DOES

TOLO HARBOUR IS NOT A PRACTICAL ALTERNATIVE NOT HAVE THE INFRASTRUCTURAL SUPPORT AND COULD NOT BECOME AVAILABLE WHEN REQUIRED.

FOR

ALL PRACTICAL PURPOSES THIS LEAVES US, UNTIL 1997, WITH ONLY THE KWAI CHUNG/TSING YI AREA. GIVEN ITS DEEP WATER, THIS AREA HAS SIGNIFICANT STRATEGIC POTENTIAL FOR PORT DEVELOPMENT,

AS THE PADS STUDY IN 1988 FIRST IDENTIFIED SOUTH-EAST TSING YI A SUITABLE AND VIABLE SITE FOR CONTAINER PORT DEVELOPMENT. THIS HAS BEEN CONFIRMED BY A DETAILED FEASIBILITY STUDY RECENTLY CONCLUDED.

THE QUESTION AS TO WHETHER EXISTING FACILITIES AT KWAI CHUNG COULD BE EXPANDED WILL BE COVERED BY THE SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS.

9. MUCH

IN DETERMINING THE SITING FOR CONTAINER TERMINAL DEPENDS ON THE ACCURACY OF OUR FORECASTS OF DEMAND. FOR PLANNING PURPOSES, WE HAVE ASSUMED A 14% ANNUAL GROWTH RATE IN CONTAINER THROUGHPUT AT THE TERMINALS. THIS ESTIMATE IS BASED ON WELL TESTED AND PROVEN METHODOLOGY, TAKING INTO ACCOUNT HONG KONG'S ANNUAL PERFORMANCE OVER THE PRECEDING SIXTY MONTHS AND FROM THIS PROJECTING BEEN FUTURE GROWTH AND HENCE, TERMINAL REQUIREMENTS. THIS SYSTEM HAS IN PLACE SINCE 1982 AND HAS HAD A GOOD, IF SOMEWHAT CONSERVATIVE TRACK

LET RECORD.

ME STRESS THE WORD "CONSERVATIVE"

WE - FOR WHILST

ARE PLANNING FOR 14% GROWTH, TOTAL CONTAINER THROUGHPUT THIS YEAR, AT OVER 20%, IS SUBSTANTIALLY HIGHER.

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IT HAS BEEN SUGGESTED THAT RATHER THAN PROVIDE NEW FACILITIES ABOVE IN HONG KONG BEFORE LANTAU BECOMES AVAILABLE, CARGOES OVER AND OUR PORT CAPACITY MIGHT BE BETTER HANDLED AT NEARBY ALTERNATIVE PORTS. THERE ARE TWO PROBLEMS WITH THIS FIRST WE HAVE THE LINER SERVICES IN HONG KONG WHICH GUARANTEE AN EXPORTER RAPID, REGULAR AND EFFICIENT TRANSIT TO HIS MARKETS. IF WE FORCE HIM TO USE NEARBY PORTS HIS GOODS MAY LOOSE THEIR COMPETITIVE EDGE. BUT THAT EDGE WILL NOT BE SLOW TO BE SHARPENED. THOSE TWO MILLION TEU'S THAT I REFERRED TO EARLIER WILL BE MORE THAN ENOUGH TO STIMULATE THE DIVERSION OF SHIPPING AND SUPPORT SERVICES FROM HONG KONG. ONCE GONE, THAT TRADE AND THOSE SERVICES ARE HIGHLY

TO RETURN. UNLIKELY

THIS BRINGS ME TO THE

PROBLEM. SECOND HANDLING THAT CARGO BRINGS VERY CONSIDERABLE ECONOMIC BENEFIT TO THE COMMUNITY. LOSING IT WILL GIVE US LONG TERM AND VERY PAINFUL LOSSES.

COST WE HAVE ESTIMATED THAT LOSS OF TRANSSHIPMENT TRAFFIC ALONE WOULD US SOME $30 BILLION BETWEEN 1997 AND 2006.

HAS ANOTHER SUGGESTION

BEEN THAT WE SHOULD IMPROVE THE EFFICIENCY OF OUR TERMINALS THEREBY DELAYING THE NEED FOR MORE FACILITIES UNTIL IT IS POSSIBLE TO DEVELOP ON LANTAU. IT IS IN ALL OF UNFORTUNATELY OUR INTERESTS THAT PRODUCTIVITY IS AS HIGH AS POSSIBLE. ONE CANNOT DIRECTLY COMPARE THE PRODUCTIVITY OF ONE PORT TERMINAL

PORT WITH ANOTHER.

ITS EACH HAS CHARACTERISTICS. BUT, GIVEN THE COST OF DEVELOPING TERMINALS IN KONG AND THE FACT THAT THEY ARE OPERATED BY COMMERCIAL INTERESTS, WOULD BE EXTREMELY

DO SURPRISED IF MARKET FORCES

NOT ENSURE HIGHEST LEVELS OF PRODUCTIVITY.

WITHIN A

OR ONE DIFFERENT HONG

I

THE

/MR DEPUTY

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