Rail sector

An Expert's View about Transportation and Storage in Hong Kong SAR

Posted on: 29 Feb 2012

With five new railway projects under various stages of construction and planning in Hong Kong there are major opportunities for companies to become involved and win business.

Rail sector in Hong Kong With five new railway projects under various stages of construction and planning in Hong Kong there are major opportunities for UK companies to become involved and win business. Market overview Hong Kong operates a predominantly rail based transportation system comprising domestic and cross boundary services. The entire system stretches 220 km and has 152 stations. MTR Corp (MTRC) is the only railway operator and its network is one of most intensely used in the world. It moves on average 4.3 million people every weekday. MTRC is also building a growing portfolio of businesses in China and overseas. MTRC is actively engaged in a significant expansion of its network in Hong Kong. 5 new railway projects are currently being undertaken which will expand Hong Kong's railway network by 55km to 275km by 2020. Total estimated total cost is £12.5 billion. There is an estimated £7.2 billion of project value remaining. Beyond these five new schemes, Hong Kong has started to look farther into the next round of rail projects. Future plans currently under review with the railway development study include Northern Link, South Island Line -West, North Island Link and West Express Line linking Hong Kong International Airport with Shenzhen Airport. Hong Kong is poised to have a good 15 year railway development programme. Key opportunities The five new railway projects are under various stages of construction and planning. For West Island Line, civil works commenced in 2009 and all procurement is complete. In the case of Express Rail Link, civil works commenced in Jan 2010 with civil procurement completed at the end of 2011 whereas E&M procurement commenced in 2011 for completion in 2013. For South Island Line (East) and Kwun Tong Line Extensions, major civil and some E&M contracts have been awarded; however some remaining E&M engineering works packages will be tendered up to end of 2012. The main opportunity will be offered by the Shatin to Central Link, the procurement of which will take place from 2012 to 2016. £2.8 billion of works value on the Shatin to Central Link will be procured in 2012 comprising mainly of civil works, a large rolling stock and a signalling contract. The remainder of E&M will be tendered throughout 2013/14. Latest export opportunities – Railways Latest export opportunities – Hong Kong Getting into the market ξ New contractors are being encouraged to work in Hong Kong. ξ Structure contract packages according to market status. ξ Contractors to be employed who can best manage risk, programme, construction and safety ξ MTRC is a highly demanding but very collaborative and fair client. Risk is equitably shared. ξ MTRC relationship contracting based on partnering, healthy cash flow, VE, direct contracts, insurance provided by MTRC and collaborative working ξ Technical and regulatory standards are broadly similar to those of the EU ξ In general, quality and technical standards are more important than price in bid decisions. As in most markets, flexibility in customer service, adherence to schedules and specifications and long-term commitment are key to winning business. More about doing business in Hong Kong Contacts Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS). To commission research or for general advice about the market, get in touch with our specialists in country - or contact your local international trade team. ξ Tony Yu, British Consulate General Hong Kong. Tel: +852 2901 3259 or email: tony.yu@fco.gov.uk ξ Stephanie Li, British Consulate General Hong Kong. Tel: +852 2901 3175 or email: Stephanie.li@fco.gov.uk Contact your local international trade team UKTI Events UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows. Latest events – Railways Useful links More about OMIS and other UKTI services for exporters
Posted: 29 February 2012

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