Hong Kong: Challenges and Responses of Logistics Industry

Abstract

After reviewing the trajectory of Hong Kong’s economic development, this chapter argues that the traditional role of Hong Kong in regional economic development can no longer make significant contribution to the local and regional economies, and to different stakeholders as in the 1980s and 1990s. The chapter uses Hong Kong’s port and logistics industry as the case study and studies its evolution as logistics service providers (LSPs) from both a macro perspective and a micro perspective. The transforming external environment and local challenges have forced Hong Kong’s port and logistics industry to change. The analytical result suggests that the evolution of the industry is unavoidable. LSPs need to adapt to the change and expand vertically and horizontally along the value chain, as well as spatial expansion. This can be facilitated by the institutional optimization for better regional integration with both the hinterland (PRD) and the foreland (Southeast Asia), by both the government and business associations. Appropriate domestic and regional strategies can help sustain the whole industry and LSPs, especially those in small and medium scale. This is probably the miniature of the whole Hong Kong economy and regional economic integration and intercoastal cities relationship are important strategies to Hong Kong.