The operators of what was once the world’s largest container port are coming together amid flagging volumes to try and generate efficiencies.
Hutchison Port Holdings Trust (HPH Trust) said yesterday its flagship Hongkong International Terminals (HIT) along with Modern Terminals, Cosco-HIT Terminals (Hong Kong) and Asia Container Terminals (ACT) have entered into a Hong Kong Seaport joint operating alliance to manage and operate 23 berths across nine terminals at Kwai Tsing container terminals in Hong Kong.
Revenue and costs from the management and operation of the facilities will be shared among the parties at a pre-agreed ratio.
HPH Trust said: “The trustee-manager believes that the Hong Kong Seaport Alliance will enable the parties to deploy their facilities and resources in a more cost effective and efficient manner.
“Taking into account the changing dynamics of the shipping industry, in particular with the formation of strategic alliances between shipping lines and the growing use by lines of larger vessels, the trustee-manager is of the view that the Hong Kong Seaport Alliance will enable better utilisation of the existing capacity by increasing the flexibility in the overall berth and yard planning among the 23 berths to better accommodate the need of such shipping alliances.”
Hong Kong was the world’s top container port through to 2005, and stood out from its competitors for two main reasons – first the cramped space, which forced it to be super efficient, and secondly the raft of private operators controlling the port without a local port authority being involved.
Since losing its crown to Singapore in 2005, Hong Kong has steadily slipped down the rankings, relying on transhipment boxes more and more. Its throughput last year is thought to have slid below 20m teu, placing it outside the top five boxports league.