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October 14th, 2014:

Hong Kong stops bidding for MTR projects involving UGL

Oct 10, 2014

Hong Kong has halted bidding for railway projects involving an Australian company at the center of controversial payments to Chief Executive Leung Chun-ying, Apple Daily reported Friday.

MTR Corp. (00066.HK), Hong Kong’s railway operator, shelved the public tender for two projects, including a HK$3 billion (US$386.8 million) train refurbishment program for which Australian engineering company UGL is bidding.

The move may be related to an investigation by the Independent Commission Against Corruption (ICAC) into MTR’s bidding procedures, the report said, citing an unnamed source.

In July, an employee of the rail company questioned MTR’s bidding process in documents filed with the ICAC which decided to investigate.

The investigation relates to potential violation of the anti-bribery ordinance.

UGL had been tipped to win the train upgrading project because of its experience. MTR chairman Raymond Chí’en sits on the UGL board, the report said.

The bidding will be postponed to the second quarter of next year, MTR said on its website.

On Wednesday, Australia’s The Age newspaper reported that Leung received US$7 million in secret payments from UGL after he became Hong Kong chief executive.

The Australian said the payments were outlined in a secret contract signed in 2011 when Leung was a private citizen.

Leung’s lawyer denied any wrongdoing in a statement in which he rebutted any suggestions of impropriety for the Hong Kong leader.

MTRC and UGL have worked closely since 2002. Last month, they joined forces with construction company Leighton Holdings to win a HK$25.2 billion project in Sydney, Apple Daily said.

http://www.ejinsight.com/20141010-hong-kong-stops-bidding-for-mtr-projects-involving-ugl/

Why HK airport is losing out to Singapore’s Changi

Frank Chen

Oct 9, 2014

Some people say the Occupy campaign has been hurting Hong Kong’s transportation efficiency and overall competitiveness.

This is obviously a far-fetched accusation. First, protesters did not occupy the airport and Airport Express stations. Secondly, the number of non-mainland visitors to the city actually rose 9 percent to more than 300,000 on Oct. 1 from a year ago, according to the Immigration Department.

Between Oct. 1 and 4, mainland visitor arrivals in Hong Kong also increased 1.6 percent to 663,000.

In terms of aviation capacity, Hong Kong remains competitive in the South China region. But how does our facilities in Chek Lap Kok compare with Singapore’s Changi Airport?

Changi Airport has recently pulled down Hong Kong International Airport (HKIA) from the top spot on the list of the world’s best airports this year, according to a ranking by international airport and airline rating firm Skytrax.

The downgrade came even after HKIA handled more passengers (59.9 million) and cargo throughput (4.12 million tons) than Changi (53.7 million and 1.85 million tons respectively) last year.

The slide in ranking has much to do with the territory’s ill-planned expansion programs and poor management of existing airport resources over the years.

Nowadays, it is not uncommon for passengers at HKIA to find that the travel experience is not what it should be.

Rather than being ferried through a skybridge directly onto the aircraft, travelers often have to take a bus — usually filled with the pungent smell of aviation fuel — to a plane sitting in the open-air apron and climb stairs to get on board. Given the hot temperatures in summer, it’s definitely not a pleasant prospect.

Rivalry in aviation has been a key aspect in the competition between Hong Kong and Singapore. HKIA used to have an upper hand with its status as a predominant transfer hub for long-haul passengers and a gateway to the Chinese mainland. But, as HKIA is now serving more passengers with fewer facilities compared to Changi, there is a price being paid.

HKIA has a total of just 49 aerobridge gates, all in Terminal 1 and unchanged since its inauguration 16 years ago, according to figures from the Airport Authority. Changi, by comparison, now has a total of 92 such gates; 28 have been added since the completion of Terminal 3 in 2007.

Around 40 percent of passengers departing from HKIA are now told to board planes from the apron, whereas at Changi — given its larger number of aerobridge gates and fewer passengers — it is a far more comfortable process for boarding.

HKIA recorded a new high in monthly passenger traffic last month, at 5.8 million.

When Changi completed its sleek Terminal 3, HKIA added its Terminal Two, at the north side of the existing terminal, in the same year. Yet the irony is that, the HK$2.8 billion (US$360 million) new terminal in Hong Kong is not a genuine one as it has no boarding gates at all. Departing passengers must take the automated people mover (APM) or buses to Terminal 1 for boarding. One wonders, what’s the point of building such a facility? Walk into the building, and indeed you realize it is more of a shopping mall than anything else.

The Airport Authority doesn’t stop with its whimsical planning. In 2009 it finished the North Satellite Concourse, a mini terminal located to the north of Terminal One mainly for mainland-bound flights. There is no APM connecting the two buildings and passengers, having been told to go through immigration and security checks in Terminal 1, will have to take shuttle buses there to board their planes. The construction cost of the 20,000-square meter facility is HK$1 billion and it just has ten frontal stands for narrow-bodied aircraft.

Lam Chiu-ying, former director of the Hong Kong Observatory and a well-known conservationist and blogger, lashed out at the concourse in one of his recent articles, saying it is a white elephant as most passengers would rather choose to board planes from the apron than wasting more time in the concourse, an isolated islet in the middle of nowhere.

Another problem, according to Lam, is that the concourse was not included in the original airport masterplan gazetted in the 1990s. It occupies part of the apron and may pose potential safety threat to aircraft taxiing nearby.

Some also question the Airport Authority’s decision to shelve the plan to build an X-shaped new terminal in the reserved middle field, which could have added an additional 44 jet bridge gates. Currently a much smaller terminal is under construction and is expected to be operational in 2015 with only 20 new gates.

Last month, the Advisory Council on the Environment has given its green light to the environmental impact assessment for the third runway, which is scheduled to be up and running within a decade after total investment of HK$200 billion.

Yet Lam and other green groups argue that priority should be given to short-to-medium initiatives to add further capacity to existing terminus, such as adding more jet bridge gates, building an APM to serve the north satellite concourse and rearranging facilities in Terminal 2 for easier and faster boarding.

While green activists and the government continue their debate on whether Hong Kong needs a third runway, the airport needs more terminal buildings and aerobridge gates to use its existing resources.

The airport authority should also seek cooperation with neighboring airports in Shenzhen and Macau in order to boost the overall service capacity in the region.

http://www.ejinsight.com/20140918-hong-kong-singapore-airport-competition/