Meantime Blog

News, views, insights, and musings from the Meantime teamon the world of PR, logistics, and Royal Greenwich

Trump, China, and the rise and decline of the Hong Kong shipping industry 

I spoke to Archie da Silva, managing director and co-owner of Jet-Speed Air Cargo Forwarders, about how Trump’s tactics with Iran and China are doomed to fail

Archie da Silva heads Jet-Speed Air Cargo Forwarders (HK)
Archie da Silva, CEO of Jet-Speed Air Cargo Forwarders (HK)

Archie da Silva heads Jet-Speed Air Cargo Forwarders (HK), one of Hong Kong’s largest locally owned freight forwarding companies, with over 500 employees, and branches and partners in 50 countries. 

 Founded in 1967, the company has grown and evolved with the times, from the heyday of Hong Kong’s cargo boom in the 80s and 90s to today where China is taking over Hong Kong’s role as shipping capital of Asia. 

 Archie also shares his name with a Lufthansa 747-200 freighter, which was named after him in 2001. 

 How has the market in Hong Kong changed over the years?  

 Hong Kong used to be one of the busiest ports in the world because Hong Kongers who owned factories in southern China had their import fees refunded when they exported their goods back through Hong Kong. 

 Factory owners would import their raw materials and pay standard duties, but when the goods were exported out of Hong Kong, legislation allowed them to claim the import duties back, giving them significant reductions in costs. 

 Nowadays, Hong Kong manufacturers have moved their factories away from China to cheaper countries in south east Asia like Vietnam where wages can be as low to 150USD. 

 Hong Kong continues to drop in the ocean rankings in terms of number of TEUs handled as its economy becomes more financebased and more cargo is leaving directly out of Chinese ports. 

 Are there any areas of growth that you have identified in the markets your company operates in? 

No, in both Hong Kong and China, there is currently no growth in the air and shipping business. 

It is not clear why, but business to Europe and Asia has dropped, and I suspect it might be the trade war and I don’t see a resolution to this problem.  

In general train transport has not been so badly hit as transit time between China and Europe takes 16-17 days, which is faster than ocean that takes 30 to 35 days. 

As for Jet-Speed we are developing our business in China and ocean freight, as opposed to air freight as the Chinese ports grow and Customs and trucking charges are simply more competitive on the mainland than in Hong Kong.  

  What are your predictions for the cargo industry globally for the second half of 2019 – what do you think about the US China trade war, and gulf oil tanker attacks? 

I do not see things improving at all over the next six months with China US trade war being a major factor in this. 

 China will not concede ground to Trump, and the government is already telling Chinese citizens not to buy Apple products and favour Huawei, which already developing its own mobile phone operating systems separate from US-based offerings. 

 Since the trade war began, China has not put a single order on soya beans, completely halting imports as they are waiting to see the outcome of the Huawei affair.   

 Donald Trump and his team are using foreign policy to seem tough and appeal to voters in the 2020 election which is also why the situation in Iran is difficult. 

 The original Iran deal organised by Barack Obama was fantastic, and by adding additional criteria to the original deal, such as sanctions on oil dealings and extracting themselves from Syria, he is trying to force Iran to negotiate, something they won’t do.  

People won’t come to the table unless you start compromising. 

 visit Jet-Seed Cargo for more information

About the author

Emma Murray

Emma was born in the year the Beatles broke up. She studied Middle Eastern Archaeology and Akkadian, although she has to admit her cuneiform is probably a little rusty these days. She was once an archaeologist working in Syria and Jordan, and has been an English language teacher. She has lived at one time or another in Jerusalem and Aleppo, as well as Paris and Brussels, where she went to school and learnt to speak French.