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1. I rejected bridge plan, confirms Li

2. Bridge over Pearl River Delta teeming with red herrings

1. I rejected bridge plan, confirms Li
The Standard, 24 September 2002

Billionaire Li Ka-shing said yesterday he had turned down the idea of co-operating with Hopewell Holdings to build the proposed Hong Kong-Macau-Zhuhai bridge when it was first put to him by tycoon Gordon Wu. Li earlier said comments by Canning Fok, group managing director of Hutchison Whampoa, reflected his views. Li's remarks yesterday followed a war of words between Hutchison executives and Hopewell chairman Wu, sparked off by the latter's claim that Li had initially backed the bridge proposal but later changed his stance. Fok called a special press conference to rebut this, saying Li had not declared his support for construction of the bridge in 1983. ``Wu and Li did not conduct any discussions or meetings over the construction of the bridge in the 1980s,'' Fok said earlier this month. Wu also angered mid-stream cargo operators, which include Hutchison by calling them archaic and incapable of handling the traffic volume. They hit back with a full-page advertisement. Staff reporter

2. Bridge over Pearl River Delta teeming with red herrings
SCMP, 24 September 2002

Hong Kong's recent economic malaise has put many of its elite under high levels of stress lately. You can tell because they are beginning to display the tell-tale symptoms: memory loss, irritation and moments of confusion, brought on, evidently, by brief lapses of focus. Hence, many have had to clarify earlier statements, or at least those their bosses have made. Take Port and Maritime Board (PMB) chairman Sir Gordon Wu's proposed HK$15 billion bridge linking Lantau to the western side of the Pearl River Delta. When the project, replete with its tranche of container terminals, re-entered the spotlight last month, Hutchison Whampoa supremo Li Ka-shing, understandably, had some concerns about its construction. Mr Li's terminal-operating arm, Hutchison Port Holdings (HPH), generated 27 per cent of the group's pre-tax profit last year. Hongkong International Terminals, which would be pressured by a Lantau facility, is the jewel in the crown of the HPH stable, whose sales to pre-tax profit was a healthy 37 per cent. However, when Mr Li voiced concerns about the project he targeted the bridge, not the terminals. "The ports in Hong Kong are already facing pressure for business. If a bridge is constructed to connect Hong Kong and Zhuhai, the pressure will be even bigger," Mr Li said. As support for the bridge part of the project grew to include Secretary for Commerce Industry and Technology Henry Tang Ying-yen, Airport Authority chairman Victor Fung Kwok-king, finance chief Antony Leung Kam-chung, Macau gambling guru Stanley Ho Hung-sun and others, Hutchison managing director Canning Fok Kin-ning sought to "clarify" his company's position: "We are not opposed to building the bridge. What we oppose to is the suggestion of the government subsidising the bridge." Simultaneously, the Hong Kong Terminal Operators Association took out several full-page advertisements protesting plans for "subsidised" terminals, apparently indicating industry support for the Hutchison position. Sir Gordon, for his part, could not think what they were on about as he claimed never to have sought government subsidies for the bridge, nor any future terminal developments. Stress-induced communal confusion? A lack of articulation, perhaps? Maybe. Sir Gordon earlier this month evidently also called to get rid of the midstream: he definitely called the mid-harbour handling practices "archaic". Another series of full-page ads, booked this time on behalf of another "industry" body, the Hong Kong Midstream Operators Association, more irritation from the Hutchison camp - incensed Sir Gordon would jeopardise jobs he is meant to protect - and another clarification. "I never called for the elimination of the midstream, I want to help the industry by working towards greater productivity," Sir Gordon told this columnist. "I am not trying to run people out of business, just increase productivity." And more evidence of failing memories. Ten years ago, just after the PMB's predecessor, the Port Development Board, was formed, familiar top Hutchison officials called for the elimination of the midstream, for much the same reasons as Sir Gordon allegedly cited. But when the government nixed the idea, Hutchison bought into midstream operations and now controls the lion's share. Corporate spin doctors rely on a lack of critical thinking and memory lapses, stress-induced or not. For instance, more than one Hutchison executive has recently combatted criticisms of a lack of competition at the port by saying with five operators after Container Terminal 9 (CT9) opens, Hong Kong has more competition than most ports. Let's count them: Hutchison, Wharf, CSX, China Ocean Shipping Co and CT9's Asia Terminals. Five. No confusion there. But let's count something else: berths. The four companies that operate at Kwai Chung now have 18 of them, 16 of which are controlled by Hutchison and Wharf. Add one more company - Asia Terminals, which is majority-owned by Hutchison and Wharf - and the six more berths the project will bring, and they still own more than 85 per cent of the available waterfront for container-handling. Does that figure translate into throughput and therefore market share? Probably. Does that mean Hong Kong would benefit from more competition in terminal-handling? Unquestionably. Do present growth rates warrant the construction of new terminals? Probably not, but Hutchison and Wharf's dominance is definitely something to keep in mind the next time berths are awarded. Below Deck is sure the terminal operators would have a different spin on what the berth numbers indicate, but that would be subject to clarification and ads in local newspapers appearing to show a wide range of industry support.