Forecasting cargo throughput for the port of Hong Kong: Error correction model approach

The port of Hong Kong is the primary import/export hub for the Pearl River Delta. However, with the exception of Fung, rigorous attempts in forecasting cargo traffic for the port have been lacking. The official forecast made by the Port and Maritime Board, on which policy decisions were based, was hampered by technical flaws. This paper forecasts Hong Kong's port cargo throughput by estimating a cointegrated error correction model. The baseline forecast projects lower throughput volume than the Port Maritime Board (PMB) does, but it gradually surpasses PMB's projection in the later years of the forecast period. This has important implications for the port's future infrastructure requirements and the role it will play in the regional context.