Consolidating Trading and Logistics Industry

22.    The trading and logistics industry consolidates different economic and production activities, and creates numerous jobs with different requirements for academic qualifications, skills and experience.  The industry currently employs 770 000 workers and contributes to one quarter of GDP, the highest among the four pillar industries.

Modern Logistics Services

23.    Due to changes in market demand, the industry is moving towards the provision of high value-added logistics services.  Hong Kong is developing into a regional distribution centre for high-value goods, which differs from its conventional role in transporting components, semi-finished products and finished products.

24.    With an efficient intermodal transport network, the status of a free port and a sound legal system to protect intellectual property, Hong Kong has an edge in handling and distributing high-value goods to markets in the region.  Our responsive and efficient logistics enterprises can provide high value-added and "tailor-made" services to cater for the different needs of customers in respect of supply chain management.  Our logistics industry has potential to further expand its regional services, thereby strengthening Hong Kong's position as a logistics hub.

25.    We need to build dedicated facilities to help the development of high value-added logistics services which will help shorten operating time and reduce logistics and inventory costs. We have reserved a logistics site with an area of about two hectares at Tsing Yi which will be put on the market in the first half of this year.  We also plan to designate about ten hectares of land at Tuen Mun West for the development of logistics facilities.  This will facilitate clustering of companies involved in various operations and services for the industry.  Tuen Mun West is an ideal site for this.  Upon completion of the Tuen Mun-Chek Lap Kok Link in 2018, it will only take ten minutes to travel from Tuen Mun West to the Airport. We shall conduct a feasibility study on the proposed development and shall release the logistics sites in Tuen Mun West in phases.

26.    Upon completion of the logistics facilities at Tsing Yi and Tuen Mun West, more than 300 000 square metres of floor area and 7 500 new jobs in various trades will be provided, yielding over $3 billion worth of economic benefits annually.

Facilitating the Flow of Goods

27.    After the 911 incident in the US, various countries enhanced their air cargo security requirements.  It is imperative that our freight and logistics operators make early moves to gain greater international recognition in cargo safety and management.  This will facilitate the customs clearance of our export overseas, and maintain Hong Kong's competitive advantage as a logistics hub.

28.    The Customs and Excise Department (C&ED) launched the Hong Kong Authorised Economic Operator Programme last April.  The Programme accredits local companies with sound internal safety and management systems in accordance with international criteria, giving their consignments customs facilitation, including prioritised clearance and simpler inspection procedures.  The C&ED has liaised with other customs authorities to seek mutual recognition of similar programmes, so that locally-accredited companies can enjoy corresponding preferential treatment outside Hong Kong.  The C&ED will allocate additional resources to boost companies' participation in the Programme and promote mutual recognition.

Transport Infrastructure

29.    To enhance the external connectivity of our transport network, we shall continue to push ahead with the planning and implementation of, sea, land and air transport infrastructure projects.

30.    Regarding the proposal of constructing Container Terminal 10 at Southwest Tsing Yi, we are conducting a study to examine the technical feasibility and assess the environmental impact of the proposal.  The Study on the Strategic Development Plan for Hong Kong Port 2030 is also under way to update port cargo growth forecasts and explore how to make better use of the existing port facilities to support future development.  Both studies are scheduled for completion in the first half of this year.  In deciding on the need to construct Container Terminal 10, we shall take into account, among other things, the studies' results and the economic situation and the views of stakeholders.

31.    On land transport, the local projects of the Hong Kong-Zhuhai-Macao Bridge are scheduled for completion in 2016 to tie in with the opening of the main bridge.  This bridge connection will become part of a strategic road network linking Hong Kong, Zhuhai, Macao and Shenzhen.  The Western Pearl River Delta (PRD) will fall within a three-hour commute from Hong Kong.  The airport and container ports in Hong Kong can be used for transporting goods from the Western PRD, Guangxi Province and nearby countries such as Vietnam and Thailand.  This will strengthen Hong Kong's position as a trade, logistics and aviation hub.

32.    On air transport, the Airport Authority Hong Kong (AA) has commenced an environmental impact assessment and other planning for the three-runway system, which is expected to cope with air traffic demand up to at least 2030.  The Government will decide on the development of the three-runway system when all relevant information is available.

Emerging Markets

33.    Supporting local enterprises to tap new markets, facilitating trade flows and promoting economic development are important roles of the Government.  The Government's work in this area is of particular importance to the development of the modern trading and logistics industry.  With our country's strong support, Hong Kong has submitted to the Association of Southeast Asian Nations (ASEAN) a request to join the China-ASEAN Free Trade Area to assist our traders to further tap into the emerging Southeast Asian market.  ASEAN member states are currently considering our proposed accession, and conducting internal consultations and studies.  We shall continue our lobbying work, and collaborate with the Hong Kong Trade Development Council (HKTDC) and local trade associations to organise more business missions and discussion forums to enhance interaction between Hong Kong and ASEAN businesses.

34.    Our efforts to tap emerging markets have started to deliver results.  Over the past five years, with more frequent communication through G2G platforms, the trade in goods between Hong Kong and the BRICS countries grew substantially by over 40 per cent in value.  Amongst the BRICS countries, our bilateral trade with India registered cumulative growth of over 90 per cent while that with Russia even increased by 1.5 times.  To further diversify Hong Kong's export network, we shall continue our efforts to promote Hong Kong in and strengthen trade links with emerging markets.