The gap narrows: Hong Kong port faces competition, but still has its strengths. (Cover Story).(Cover Story)

After 150 years as the undisputed gateway to China, Hong Kong is hearing footsteps. They're coming from the upstart South China ports of Yantian, Shekou and Chiwan, all of which grew by more than 40 percent last year while Hong Kong's volume fell by 1 percent.

The South China ports, which serve the Shenzhen special economic zone, handled more than 5 million TEUs last year, up from 256,531 TEUs in 1995. Through the first eight months of this year, the Shenzhen ports posted a 52 percent increase. Hong Kong, meanwhile, posted a 2.3 percent gain.

So are Hong Kong's days numbered as the busiest container port of the region and the world? Don't bet on it, says Stanley Shen, general manager of corporate marketing at Orient Overseas Container Line. "I don't know why Hong Kong is doubting itself," Shen said. "Hong Kong was, is and will be the hub for South China."

Hong Kong is still the world's busiest container port, handling 18 million TEUs in 2001. Its shipping services cover the globe, and major carriers continue to send most of their big ships in the region to Hong Kong. OOCL and its four Grand Alliance partners made 2,848 port calls last year to Hong Kong, compared with 553 to the Shenzhen ports. If a shipper misses a sailing in the Shenzhen ports, the cargo sits for a week. In Hong Kong, it goes on another ship the same day.

Furthermore, the Shenzhen ports, especially Yantian, are paying a price for their success. Yantian is approaching its capacity, and its infrastructure is strained. "This year, Yantian has severe congestion at the container yards and berths," said Alan Lo, director of the ocean division at cargo consolidator Expeditors Hong Kong Ltd.

The Shenzhen ports, entities …