3 Aug 2016
Better, Cheaper and Faster Logistics
Hong Kong brings many skills and experience to the table when it comes to helping China implement its Belt and Road Initiative, according to John Slosar, Chairman of John Swire & Sons (HK) Ltd and Swire Pacific. The head of one of Hong Kong’s leading conglomerates looks at how China’s development strategy will breathe new life into the global transport and logistics industry.
What’s your assessment of China’s Belt and Road Initiative?
If you look at the history of economic development, it is strongly tied with trade. Trade and economic growth have gone together for thousands of years. The Belt and Road Initiative aims to improve trade infrastructure and political relations between countries. And for sure, anything that makes it easier to trade will bring economic benefits to all sides.
The interesting aspect of the Belt and Road is that it will create opportunities, which will be different from those that we can take advantage of right now. The winners will be those companies that can recognise these new opportunities and organise themselves to tap into them. You cannot expect that tomorrow will always be like today. You have to be open-minded about how the world may change and how new economic linkages will create new opportunities for you.
What does it mean specifically for the global transport and logistics industry?
The Belt and Road, at its core, is about better, cheaper and faster logistics. It is about building infrastructure and removing barriers to trade, and by doing those two things, creating new trade opportunities. Those trading opportunities bring people and businesses together and spark economic growth. It is a big and bold idea, but it also has a great economic pedigree so it is very sensible as a concept. Recent years have also seen a wave of new logistics and information technology that would support Belt and Road efforts.
“The Belt and Road, at its core, is about better, cheaper and faster logistics. It is about building infrastructure and removing barriers to trade, and by doing those two things, creating new trade opportunities.”
How can companies such as the Swire Group, benefit from this Initiative?
A significant component of our portfolio of businesses is involved in transport and logistics. We have the airlines – Cathay Pacific was the world’s largest air cargo airline a few years ago. We are involved in shipping in the Asian region, specifically between China, Hong Kong and some of the Belt and Road countries. We are also involved in other infrastructure-related sectors such as cold-chain logistics, so we think there is ample opportunity for us.
Here in Hong Kong, where we are based, we are on the Maritime Silk Road. Hong Kong has always been involved in maritime trade, so we have the knowledge and experience and our city will have the opportunity to play a big role.
What are the advantages that Hong Kong brings to help implement the Initiative?
In addition to our experts in logistics, Hong Kong brings many skills and much experience to this Initiative. Building infrastructure will require financing and project management. Hong Kong is skilled at capital-raising, insurance, project analysis and project management. We have also spent a generation applying ourselves to helping China to develop and our experience in doing that can be applied in other parts of the world as well.
Hong Kong’s legal system is also a great strength, well appreciated by those doing business here. Countries along the Belt and Road that do business with Hong Kong will be happy with our well-structured and understandable legal system, especially as it applies to enforceability of contract.
How has the inaugural Belt and Road Summit, held in Hong Kong in May, jumpstarted the dialogue among Belt and Road economies?
Good information is crucial in helping businesses to assess what is possible and to understand the how, where, when and why of what concrete projects are actually going to happen. Business people also want to know how they can get involved.
I believe the inaugural Belt and Road Summit went a long way to getting these important questions answered. There was not only strong local participation in the Summit, but global involvement as well. This was not surprising to me given what I hear from businesses all around the world: “how do I get involved in the Belt and Road?”