Transportation systems in Hong Kong and Southern China: A manufacturing industries perspective

Hong Kong has been a major entrepôt for China for decades and its intermediate role has been enhanced in recent years. With the open door policy of China, Hong Kong manufacturers have relocated extensively their low‐cost operations to the Pearl River Delta in Southern China. Under the outward processing arrangement, raw materials, components and work‐in‐progress are shipped to China for further processing and the finished products are shipped back to Hong Kong for re‐export to other countries. This mode of operation has created tremendous loads on the already congested cross‐border traffic between Hong Kong and the Pearl River Delta. In order to modernize its outdated and inadequate transportation systems, China has embarked on huge infrastructure development programmes in the Pearl River Delta and other fast developing regions. Hong Kong has also launched multi‐billion‐dollar ports and airport development projects scheduled to be completed in 1997/98. On completion of these projects, the strategic position of Hong Kong as an entrepôt of Southern China will be further enhanced, despite increasing competition from neighbouring ports and airports in the medium to long term.