Hong Kong 2006 - Transport

Hong Kong is a major international and regional aviation centre. The Hong Kong International Airport (HKIA) is one of the busiest airports in the world. At the end of 2006, there were 85 airlines providing about 5 400 weekly services between Hong Kong and more than 150 cities worldwide.

It was another record-breaking year for HKIA. A record high of 44.45 million passengers, including 1.16 million transit passengers, passed through the airport during the year, representing an increase of 9.1 per cent over 2005. Aircraft movements increased by 6.5 per cent to a total of 280 508. Air cargo throughput also set new records: the airport handled 3.58 million tonnes of air cargo, representing an increase of 5.2 per cent over 2005. The corresponding value also increased by 11.3 per cent to $1,745 billion. In 2006, HKIA ranked number one and number five worldwide in terms of international cargo and international passenger throughput respectively. The ranking was based on figures from the Airports Council International (ACI).

Air transport continues to play an important role in Hong Kong's external trade. Goods carried by air accounted for 38.1 per cent, 37.5 per cent and 30.3 per cent in value terms of Hong Kong's total imports, exports and re-exports respectively in 2006.

Improving connections with the Pear River Delta (PRD) region through the development of a range of transport links remains a major strategy of the Airport Authority which plans to extend the airport's catchment area to cover the entire PRD region which has a population of over 40 million. During the year, about 1.7 million transit passengers used the Airport Authority's cross-boundary ferry service between the airport and five PRD ports. Passengers on these ferries do not have to go through customs and immigration procedures in Hong Kong before they board international flights, which results in significant savings in total travel time. The Airport Authority further enhanced the service by providing an upstream check-in service at Shekou Port. Transit passengers can now check in their luggage at Shekou and travel baggage-free to the airport for their onward journey to overseas destinations.

The cross-boundary coach services are another major transport link between HKIA and 40 destinations in the PRD. In 2006, about 1.5 million passengers travelled between the airport and the PRD using the 280 daily coach services.

HKIA continued to work closely with airports on the Mainland to explore cooperation opportunities that would improve the integration of passenger and air cargo flows in the region. During the year, the Airport Authority formed a joint venture with the Zhuhai Municipal People's Government to manage the Zhuhai Airport. The arrangement went into effect on October 1, 2006.

HKIA fulfils the ever-increasing expectations of customers by offering the highest standard of service. In addition to state-of-the-art facilities to support hassle-free flow of passenger and cargo, the airport's shopping mall, Hong Kong SkyMart, currently home to over 200 shops and restaurants including 25 top-line brand names, gives customers a shopping experience comparable to that offered by any high-end city centre shopping mall.

Indeed, HKIA itself is one of Hong Kong's most successful brand names, thanks to the dedication and commitment of the whole airport community. In 2006, HKIA received Travel Trade Gazette's Best Airport Award, for the fourth year in a row.

The Mainland's fast-growing aviation market brings growth opportunities as well as new challenges to HKIA. 'HKIA 2025', the latest Master Plan of the Airport Authority published in December 2006, re-examined the airport's long-term vision, growth strategy and facility planning directions, in the light of growing demand and intensifying competition.

With China's fast-growing international trade, the demand for aviation service between Mainland cities and international destinations will see continuous strong growth in the coming 20 years. Leveraging on its well established international network, HKIA aspires to be one of the most important gateway hubs of China, maintaining at the same time its status as a leading international aviation hub in Asia. The Airport Authority envisages that by 2025, HKIA will handle 80 million passengers and 8 million tonnes of air cargo each year.

To meet the challenges and opportunities ahead, HKIA will continue to expand its catchment area in the PRD region through cross-boundary ferry and coach connections and make cross-boundary travel more convenient. The Airport Authority will continue to encourage airlines to expand their networks of both Mainland and international destinations. Furthermore, the Airport Authority is working with the Civil Aviation Department (CAD) to maximise the existing runway capacity. The studies on the engineering and environmental feasibility of building a third runway will soon be initiated.

On facility planning, to cater for the increasing traffic demand between HKIA and the Pearl River Delta region, a permanent cross-boundary ferry terminal, SkyPier, will be built to link up with passenger terminal buildings using the Automated People Mover system. In December 2006, the Airport Authority issued invitations for pre-qualification proposals for building a new cargo terminal at HKIA. The new terminal will provide the needed extra capacity in time to meet the additional demand in the 2010s. A precious metals depository will be set up in HKIA to provide a central, secure storage facility for traders and institutional investors, and to serve as a physical settlement platform for Asian markets. The Airport Authority has signed an agreement with business partners to build a second airport hotel. The new five-star airport hotel with 1 000 rooms will provide travellers, tourists and exhibition visitors with a perfect place to unwind.

Meanwhile, several major projects were completed in 2006. SkyPlaza, a multi-purpose development comprising a new departure hall, airline check-in counters, ground transportation facilities and retail and office space, is ready for occupation in phases from early 2007. Hong Kong Aircraft Engineering Co Ltd's second hangar at HKIA is now in operation and can accommodate two wide-bodied and one smaller aircraft at the same time. The Asia Airfreight Terminal completed its Terminal 2 in December 2006, bringing its annual cargo handling capacity from 600 000 tonnes to 1.5 million tonnes. The giant A380 aircraft landed at HKIA for the first time on November 18, 2006 after the completion of related taxiways and parking stands enhancement works.

Under the specific authorisation of the Central People's Government, the HKSAR Government continues to negotiate and conclude bilateral air services agreements with aviation partners, providing the legal framework for scheduled air services between Hong Kong and other places. During the year, the Government concluded new air services agreements with Ethiopia, Mexico and Kazakhstan bringing the total to 58 agreements.

The Government also reviews actively the traffic rights arrangements with its partners to expand Hong Kong's aviation network and to introduce more competition into the market. In 2006, the Government expanded traffic arrangements with six aviation partners, including fully liberalising bilateral air services between Hong Kong and Brunei, Jordan, and the United Arab Emirates.

During the year, the Air Transport Licensing Authority (ATLA) granted seven licences: one to Cathay Pacific Airways (CPA), one to Hong Kong Dragon Airlines (HDA), two to AHK Air Hong Kong (AHK) and three to Hong Kong Express Airways (HKE). The Procedural Guide on ATLA's procedures for processing licence applications is available on: www.edlb.gov.hk/edb/eng/related/Guide-eng-final.pdf .

Cathay Pacific Airways (CPA) celebrated its 60th anniversary in September 2006. CPA also completed its shareholding realignment with relevant parties which made Hong Kong Dragon Airlines (HDA) a wholly owned subsidiary of the airline. CPA commenced codeshare arrangements with British Airways Comair to the cities of Cape Town, Durban and Port Elizabeth in South Africa in August. It also started to codeshare with HDA flights to six destinations, namely, Beijing, Kota Kinabalu, Phuket, Shanghai, Tokyo and Xiamen in September. In December, the airline resumed its passenger services to Shanghai. During the year, the airline took delivery of one Boeing B777-300 and one Airbus A330-300 aircraft, the latter being the 100th aircraft of the airline fleet. As for freighter services, the airline launched new services to Chennai in June, commenced services to Stockholm and Toronto in September and Beijing in November. During the year, two Boeing B747-400 BCF freighters under the B747-400 passenger-to-freighter conversion programme were received. By the end of 2006, CPA operated scheduled services to 55 destinations worldwide.

During the year, three Airbus A330-300 aircraft were delivered to HDA. The airline launched scheduled passenger air services to Shenyang in April, suspended the scheduled services to Bangkok in September and resumed services to Phuket in December. In respect of air cargo, two Boeing B747 BCF freighters were delivered and the airline increased the frequency of its services to Frankfurt in October. By the end of the year, HDA operated scheduled services to a total of 33 destinations, including 19 cities on the Mainland.

AHK Air Hong Kong received two more new Airbus A300-600 freighters in May and June respectively. New scheduled all-cargo services to Nagoya were launched in October. The airline serves a total of eight destinations in Asia.

The Air Operator's Certificate issued to CR Airways was revised following its switch of fleet to four B737-800 aircraft from June this year. The airline expanded its network to cover Changsha, Tianjin and Fuzhou in August, September and December respectively. In November, the airline changed its name to Hong Kong Airlines. By the end of the year, Hong Kong Airlines operated scheduled services to a total of eight destinations.

Hong Kong Express Airways (HKE) acquired the fourth Embraer ERJ-170 aircraft in May. The airline commenced air services to Chiang Mai and Chongqing in June and July respectively.

A new airline, Oasis Hong Kong Airlines commenced scheduled passenger services to London Gatwick Airport after it was issued an Air Operator's Certificate in October. It was operating two Boeing B747-400 aircraft by December 2006.

An Air Operator's Certificate was issued to Heli Express Limited in February to provide non-scheduled helicopter air services.

Regarding non-Hong Kong airlines, Qatar Airways commenced scheduled passenger services between Doha and Hong Kong in March. Air Niugini resumed passenger services between Port Moresby and Hong Kong in August. For scheduled all-cargo services, Ocean Airlines commenced services between Milan and Hong Kong in June. In July, Volga Dnepr Airlines commenced services between points in Russia, Nagoya and Hong Kong. In October, Southern Air commenced services between points in the USA and Hong Kong, and Sky Express Aviation (Cargo) Limited, between Athens and Hong Kong.

Two airlines suspended their services to Hong Kong in 2006. Australian Airlines suspended its passenger services between Cairns and Hong Kong in July. Thai Sky Airlines suspended its passenger services between Phuket, Taipei and Hong Kong in October.

The Environmental Impact Assessment Study for the proposed expansion of the cross-boundary heliport at the Macao Ferry Terminal was completed in February 2006. Tendering arrangements for the proposed expansion works was in progress. Also, the Government decided to open the proposed government helipad at the Hong Kong Convention and Exhibition Centre to commercial operators to provide them with a permanent landing facility. A technical feasibility study is being conducted to take the project forward.

To ensure aviation safety and to give effect to the latest international standards governing the transport of dangerous goods by air in Hong Kong, the Dangerous Goods (Consignment by Air) (Safety) Regulations and the Air Navigation (Dangerous Goods) Regulations were amended and came into effect on November 1, 2006.

The Government continued to align Hong Kong's aviation legislation with the latest international standards. The local law of Hong Kong was amended to give effect to the Convention for the Unification of Certain Rules for International Carriage by Air, signed in Montreal on May 28, 1999. The Convention, which improves the protection of the interests of passengers and shippers in international carriage by air, took effect in Hong Kong from December 15, 2006.

The air traffic control system continued to perform in a stable and reliable manner. It handled 280 508 aircraft movements at HKIA and 139 714 overflights, including aircraft flying to and from Macao Airport, representing a 6.5 per cent and 11.2 per cent increase over 2005.

The Civil Aviation Department continued its discussion with the civil aviation authorities of the Mainland and Macao on measures to improve the efficiency of air traffic operations in the Pearl River Delta area. The tripartite working group met on three occasions in the year to identify long-term solutions and interim measures to rationalise air traffic management to support air traffic growth in the PRD region. One of the measures was the establishment of a new handover point on December 21, 2006 to improve air traffic flow between Hong Kong and Guangzhou.

CAD joined forces with the People's Liberation Army Forces in the HKSAR, various government departments and the United States search and rescue units to conduct long and short range search and rescue exercises from October 24-27. The exercise served to enhance the preparedness and capability of all parties concerned in the event of a situation that requires emergency search and rescue.

The Technical Services Agreement providing technical services for the operations and maintenance of the mission-critical air traffic control systems for HKIA and Hong Kong Flight Information Region expired on September 30, 2006. Following the completion of open tender procedures, contracts for the provision of relevant technical services were awarded to PCCW-HKT Telephone Limited in September 2006 for a period of 10 years.

The old Doppler VHK Omni-Directional Radio Range and Distance Measuring Equipment (DVOR/DME) on Tung Lung Island was decommissioned in May 2006. The replacement system was installed and put into operation on December 21, 2006.

In March, a 'Technical Arrangement on Aircraft Maintenance' was signed between the Civil Aviation Directorate of Transport Canada and CAD for the mutual recognition of aircraft maintenance approval. This arrangement is an expansion of a previous one signed in December 2005.

In June, a 'Cooperation Arrangement on Mutual Acceptance of Approval of Aircraft Maintenance Organisations' was signed between the General Administration of Civil Aviation of China, Macao Civil Aviation Authority and CAD. This cooperation arrangement, which includes entire aircraft maintenance, is an expansion of a previous one signed in May 2002 that covered only aircraft component maintenance.

In Hong Kong, the impact of aircraft noise was assessed on the basis of the internationally accepted Noise Exposure Forecast (NEF) Contour. The determination of the contour took into account factors including the decibel levels of aircraft noise, its tonal characteristics and the duration and frequency of overflying flights at different times of the day. The aircraft noise standard adopted in Hong Kong was the NEF 25 contour, which was more stringent than the standards adopted by some other international airports.

CAD continued to monitor closely the flight tracks and the noise impact on the community and to implement all practical aircraft noise mitigating measures. These measures included flight paths that cross fewer residential areas at night, noise abatement arrival and departure procedures, and prohibiting the operation of noisy aircraft which exceeded the noise standard stipulated in Volume I, Part II, Chapter 3 of Annex 16 to the Convention on International Civil Aviation.

The department continued to provide support to the ICAO (International Civil Aviation Organisation) Universal Security Audit Programme. During the year, one officer from the department, who has been qualified as ICAO certified aviation security auditor, served as Short Term Expert of ICAO team in the security audit of New Zealand.

Following the completion of the airport upgrading works for new large aircraft in mid-2006, CAD conducted the HKIA aerodrome assessment and confirmed that it was in compliance with the ICAO requirements. In July 2006, CAD endorsed the reclassification of HKIA to a Code 4F aerodrome for accommodating aircraft with wing spans of up to 80 metres including Airbus A380.

The first A380 aircraft to fly into Hong Kong landed at HKIA on November 18 and departed for Tokyo the following day. An operational trial involving airport facilities and ground handling franchisees went off smoothly. CAD with the parties concerned reviewed the operational trial to facilitate the continuous improvement in aircraft servicing operational procedures and facilities by the relevant service providers.