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Following is a question by the Hon Wong Ting-kwong and a written reply by the Secretary for the Environment, Transport and Works, Dr Sarah Liao, at the Legislative Council meeting today (May 3) :
Question :
It has been reported that the rail freight volume handled by Hong Kong has been dropping year after year, from 2,200,000 tonnes in 1989 to 210,000 tonnes in 2005. Moreover, the Freight Department of the Kowloon-Canton Railway Corporation (KCRC) closed six of its Mainland offices earlier this year and only its Shenzhen office has been retained. In this connection, will the Government inform this Council whether:
(a) KCRC has reviewed the company's persistent yearly drop in rail freight volume; if it has, of the details; if not, the reasons for that;
(b) KCRC has downsized its freight business; if it has, of the details; and
(c) it will consider formulating measures to enhance the competitiveness of Hong Kong's rail freight service, including discussing with the State Ministry of Railways the joint development of cross-boundary rail freight service; if it will, of the details; if not, the reasons for that?
Reply :
Madam President,
The Kowloon-Canton Railway Corporation (KCRC) operates its business including freight business under prudent commercial principles. The Corporation reviews its freight business from time to time and conducted a detailed examination of its freight business strategy in 2004.
KCRC considers that the decreasing rail freight volume in recent years is due to a combination of factors, notably market competition. As compared with other modes of freight transport, rail freight has less flexibility due to the constraints by the alignment of the railway network. Goods transported by rail invariably need to be further transported by road vehicles. Besides, there are operational aspects in rail freight which render the time for transport longer, including the transfers at railway stations, switch of train locomotives, and customs clearance arrangements, etc. As a result, as compared with the direct use of road vehicles or barge in freight transport, rail freight does not have unique advantages in terms of time or costs in the Hong Kong market.
KCRC also considers that the rapid development of other freight terminals in Shenzhen (e.g. Yiantian, Shekou) and Nansha in Guangzhou has reduced the rail freight volume between Hong Kong and the Mainland.
KCRC conducted a detailed examination of its freight business strategy in 2004 and repositioned its strategy in 2005. The Corporation decided to phase out its freight forwarding business due to market conditions, and gradually closed down six offices in the Mainland since last year while retaining the office in Shenzhen. KCRC, however, has not completely withdrawn from freight business. It continues with its core business in freight business under prudent commercial principles and, as a carrier, develops rail freight for containers, general cargo and livestock, and operates freightyards. Specifically, on freight business, the Corporation focuses on further enhancing cross-boundary freight services and liaison on port facilities matters with the Mainland railway authorities, so as to enhance the competitiveness of rail freight. KCRC also steps up its marketing efforts, including information collection on market situation, exploring new business opportunities, launching new services and promotions, etc.
The Government has all along been encouraging KCRC to fully capitalise the advantages of rail freight and proactively develop cross-boundary rail freight business. On this, KCRC is actively exploring with the Mainland railway authorities freight through-train services between Hong Kong and Mainland cities. For example, in light of the rapid development of manufacturing industries in Dongguan and the completion of a number of industrial areas in the city which bring about an increased demand in timber, metals, mechanical equipment and plastics, there will be an increase in demand for rail freight as the transport of such goods relies heavily on rail. On this, KCRC and relevant Government departments are in discussion with the relevant Mainland authorities to start the freight through-train service between Hong Kong and Dongguan as early as practicable.
In addition, having regard to market competition, KCRC has implemented a series of measures to facilitate cross-boundary freight business including:
(i) proactively exploring with the relevant Mainland authorities the possibility of lowering charges and offering discount to clients;
(ii) further enhancing the operating system of freight business including introduction of on-line system and procurement of new loading/unloading facilities for enhanced efficiency; and
(iii) strengthening communication with the relevant Mainland authorities in order to streamline the customs clearance arrangements as far as practicable.
Ends/Wednesday, May 3, 2006
Issued at HKT 12:25
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