According to Everstream Analytics, port congestion and delays are still prevailing in the global ocean cargo industry for the coming months. While operations of terminals and ports will be interrupted by the pandemic, waiting times for vessels and port congestion continues to increase. Port yard utilization surges because of pandemic restrictions and labour shortage.
The supply chain disruption pushes manufacturers to shift from “just in time” strategy to “just in case” strategy, stocking up crucial components and inventories, increasing safety stock to combat logistics delays and shortages. However, a higher inventory level means extra costs for goods and warehouse space, that also imposes higher risk to low-margin industries.
Focusing on the local perspectives, the HKTDC Research forecast for Hong Kong’s 2022 exports growth is 8% year‑on‑year.
Growing concern over global inflation with monetary tapering by major central banks, tension among China-US relations, plus the development of the pandemic and supply chain disruption all set pressures on Hong Kong’s businesses. The latest HKTDC Export Index survey reveals that Hong Kong exporters anticipate logistics costs to continue rising in the first quarter of 2022. While 29.1% of them expect their total sales would remain unchanged over the year, 28.3% look forward to an increase.
Air shipping may be respected as a substitute to sea and land shipping, skipping the high time costs and risks, especially for transporting time-sensitive and high valued goods. Hong Kong has world-class air logistics facilities offering safe and flexible logistics solutions to global businesses.
Suggested by SCMP, Hong Kong can keep its global logistics leadership having a comparative advantage of strong connectivity with Greater Bay Area, as well as Belt and Road Initiative partner countries in Central Asia. Possessing the strength as an international financial centre, Hong Kong can still outpace growing regional competition by enhancing its capacity and connectivity, subsequently consolidating its stance as the steering global logistics hub.