business in hong kong

Hong Kong jewelry fair sets exhibitor record

The Hong Kong International Jewellery Show, the world’s third-largest jewelry fair, opened March 4 with 2,306 exhibitors from around the world — a new fair record.

Organized by the Hong Kong Trade Development Council (TDC), the four-day fair was held at the Hong Kong Convention and Exhibition Centre.

Speaking at the opening ceremony, Chairman of the TDC’s Jewelry Advisory Committee Charles Chan noted the fair is celebrating its silver jubilee this year against a backdrop of upbeat industry news.

The world’s fourth-largest jewelry exporter, Hong Kong saw jewelry exports jump 17% in 2007 to US$4.3 billion. The United States and the European Union are the territory’s biggest markets, with growth seen from such mature and discerning markets as Italy and the United Kingdom.

Emerging markets also made news. Exports to Russia and the United Arab Emirates grew 177% and 39%, respectively, in 2007. India and mainland China were up 45% and 13.5%, respectively.

This year’s fair included exhibitors from 45 countries and regions, with Cambodia, Egypt, Lebanon, Kuwait and Mexico participating for the first time.

The Jewellery Show attracted 31,000 buyers in 2007. The TDC this year organized 72 buying missions, with more than 4,200 new buyers visiting the fair. These included key buying representatives from such well-known jewelry brands and leading stores as Tiffany and Ben Bridge.

The Hong Kong Jewellers’ & Goldsmiths’ Association, the Hong Kong Jewellery & Jade Manufacturers Association, the Hong Kong Jewelry Manufacturers’ Association, the Diamond Federation of Hong Kong, the Hong Kong Watch Manufacturers Association and the Federation of Hong Kong Watch Trades & Industries were fair co-organizers.

New cargo terminal franchise goes to Cathay

The Board of Airport Authority Hong Kong awarded a nonexclusive, 20-year franchise to design, construct and operate a new cargo terminal at Hong Kong International Airport (HKIA) to Cathay Pacific Services, a wholly owned subsidiary of Cathay Pacific Airways.

The new terminal and recently completed enhancements to the cargo apron, taxiways and aircraft stands will equip HKIA to meet future demand for cargo services and to maintain its position as the region’s premier air cargo hub.

Airport Authority Chief Executive Officer Stanley Hui said the new cargo terminal will reinforce the competitiveness of HKIA as a regional and international air cargo hub. It will provide additional choices for airlines, shippers and freight forwarders. In addition, it will bring substantial economic benefits, in the form of new jobs and business opportunities, to Hong Kong.

Scheduled to open in the second half of 2011, the new terminal will have an annual capacity of approximately 2.6 million metric tons and increase the airport’s annual total general and express cargo handling capacity to 7.4 million metric tons. The new facility will be located on a 10-hectare site in the cargo terminal area.

According to Cathay Pacific Services, construction of the new terminal will create more than 400 jobs. When it starts operation, the facility will employ more than 1,700 people.

“The new operator will bring additional competition to Hong Kong’s air cargo industry and build on the reputation for quality and efficiency that HKIA and its existing general cargo operators have achieved,” noted Mr. Hui. The number of general and express cargo operators at HKIA will increase from three to four.

The decision to build a new cargo terminal was made following extensive consultations with Hong Kong’s air cargo and logistics industry.

Driven by the rapid expansion of the mainland Chinese economy and robust global trade, cargo throughput at HKIA rose 4.5% in 2007, to 3.74 million metric tons. The air cargo industry handled more than US$243.58 billion worth of goods in 2007, representing 35% of Hong Kong’s total external trade. HKIA is the world’s busiest international cargo airport for the 11th consecutive year, since 1996.

HKIA records continued growth

Driven by strong demand from Hong Kong residents over the Lunar New Year, passenger throughput at Hong Kong International Airport (HKIA) reached 3.9 million in February, up 7.3% year-on-year.

While the Lunar New Year is usually a quiet period for cargo, total throughput increased 5.1% year-on-year, to 247,000 metric tons. This is mainly attributable to growth in transhipments and imports. Air traffic movements increased 6.7% to 23,760.

Combined passenger throughput for January and February reached 7.9 million, up 10.3% compared to the same period last year, mainly due to robust visitor growth. Cargo throughput grew 7.2% year-on-year to 542,000 metric tons, while air traffic movements reached 48,560, a 6% year-on-year increase.

Significant passenger growth for Cathay Pacific

February traffic figures for Cathay Pacific Airways and Dragonair show robust passenger growth, along with an increase in cargo and mail tonnage.

The two airlines carried a total of 1,954,431 passengers — up 13.9% year-on-year — while the month’s load factor rose 2.1 percentage points to 77.6%. Capacity, measured in available seat kilometers, increased 15.7%.

The sister airlines together carried 121,101 metric tons of cargo and mail in February, a 7.6% increase year-on-year. The cargo and mail load factor grew 0.9 percentage points to 64.6%. Cargo capacity grew 8.3% for the month.
           
Profit for Cathay Pacific up 72%

On March 5, Cathay Pacific Airways announced a profit of US$900.38 million in its 2007 annual results, compared to a profit of US$524.1 million the previous year. The 2007 result, the first to include a full year's contribution from wholly owned subsidiary Dragonair, is a record annual profit for Cathay Pacific.

Group turnover increased 24% to a record US$9.66 billion in 2007. High fuel prices continued to have a significant impact on the airline, particularly in the second half of the year, and the fuel bill rose 21.8% to US$3.15 billion. This was only partially offset by fuel surcharges. The unit cost excluding fuel fell slightly as a result of the airline's efforts to increase productivity and reduce controllable overheads.

Passenger demand was high throughout the year, and Cathay Pacific carried a record 17.8 million passengers in 2007 — a 6.2% increase year-on-year. Strong demand from premium passengers also helped to improve the yield, and pushed total passenger revenue to a new high of US$5.03 billion, a 17% increase compared to 2006. Capacity, measured in terms of available seat kilometers, rose 3.9% as new aircraft arrived and services on key routes were strengthened in the second half of the year.

In 2007, Cathay Pacific and Dragonair added 12 new aircraft to their fleet, including the first five of 30 Boeing 777-300ERs the airline has on firm order. The new planes, which will become the mainstay of Cathay Pacific’s long-haul fleet, were used to add a second daily nonstop flight to New York. New daily services also were added to Melbourne and San Francisco, with flights also added to Adelaide, Australia; Frankfurt, Germany; Paris; Perth, Australia; Tokyo; Toronto and Vancouver. Also, seven new destinations were added to the network in 2007 through code-share arrangements with Dragonair.

There was a further expansion to the freighter fleet in 2007, and the increased capacity helped Cathay Pacific carry a record 1,353,000 metric tons of freight, despite a soft market throughout the year. Cargo revenue increased 10% to US$1.69 billion, while the cargo load factor fell 0.8% to 67.5%. A combination of factors, including weak demand out of Europe and North Asia, increased competition and a modal shift to marine freight due to high fuel prices, led to a 7.7% decline in cargo yield to US$0.20.