Guangdong’s plan to spend billions of yuan to create a network of ports, railways and waterways will pose a competitive threat to Hong Kong, but it may benefit Hong Kong exporters. Guangdong ports are reaching the limits of their capacity. Guangzhou’s Nansha port can hardly handle more than 20% of Hong Kong’s cargo, so the province could use more port facilities. Over the next three years, the province will spend CNY55.4 billion on building port facilities, waterways and railways, according to the Shenzhen Ports Association’s website. About CNY28.7 billion of that will be spent on port projects, including the third phase of Nansha, container terminals at Yantian port in Shenzhen, container terminals in Gaolan port in Zhuhai and a coal terminal in Quanwan port in Huizhou. This will increase Guangdong’s annual container capacity by 10.5 million TEU to 50 million TEU and raise Guangdong’s annual cargo capacity to more than 1.3 billion tons. A further CNY8.2 billion will be invested in waterways in Guangdong in the next three years. The province will invest CNY18.5 billion in building railways over the next three years, linking various ports including Nansha, Maoming and Zhanjiang in southwest Guangdong, and Chaozhou and Shantou in northeast Guangdong. Creating rail links to ports would improve the hardware, efficiency and cost of Guangdong’s ports, said Anthony Wong, former President of the Hong Kong Logistics Association. “Guangdong’s ports will be more competitive, efficient and cost-effective. That will not be good for Hong Kong, which competes with them.” Guangdong ports were offering much lower fees than Shenzhen and Hong Kong to attract volume, Liu Boyong, Equity Analyst at investment bank Jefferies, said. He warned that the return on investment on some of these port facilities would probably be low. Guangzhou Port Group, the state-owned operator of Guangzhou’s ports, has been planning a listing since 2007, the South China Morning Post reports.