The government has proposed scrapping a ban on the use of Hong Kong as a staging port for the export of alternative smoking products such as electronic cigarettes from mainland China in a bid to halt a plunge in air cargo volumes from the city.

The government, confirming an earlier report in the Post, on Monday said it had proposed an exemption for e-cigarettes, heated tobacco products and herbal cigarettes brought to Hong Kong by road and sea for air transport elsewhere.

But the authorities emphasised a string of measures designed to prevent the products from being sold in the city, where an importation ban is in force, rather than just moved through it, would be introduced.

“The government hopes to ensure the policy on the importation ban on alternative smoking products will be preserved, while maintaining Hong Kong’s position as a leading international aviation and logistics hub,” Pamela Lam Nga-man, the deputy secretary for transport and logistics, said.

She was speaking at a Legislative Council panel meeting where the proposals were discussed. Authorities said they hoped to take the amendments to Legco early next year.

Hong Kong is a major logistics hub for Asia and a gateway for trade between the mainland and the rest of the world.

Hong Kong International Airport handled 5 million tonnes of cargo last year, about 42 per cent of the city’s overseas trade and worth around HK$4.34 trillion (US$556 billion).

But the air cargo volumes fell by 18 per cent on average from May to October this year compared with the same period in 2021.

Some of the decline was attributed to the loss of transshipment of alternative smoking products from the mainland, a major global manufacturer in the sector, as most of the materials were transported through Hong Kong for onwards distribution.

“If the situation continues, Hong Kong’s position as an international aviation hub will be seriously undermined,” Lam said.

The government’s proposal was that products that arrive by sea for air shipment would use a mainland logistics park set up under a pilot transshipment scheme between the city’s airport and the mainland city of Dongguan, launched early this year by the Airport Authority Hong Kong.

Authorities said officials would continue to work with the industry to set up a scheme for secure road transport from the mainland to the airport.

The government also proposed conditions to minimise the potential risk of the products being leaked into the city’s black market, including the need for documents to accompany shipments.

The products would also have to be directly transferred by designated routing in Hong Kong.

The goods would also need to be transported under secure conditions and delivered to restricted areas of the airport, where they would be held until flown out.

Other measures, such as provision of advance cargo information, application of designated seal or e-lock on containers and GPS tracking of the cargoes would also be used.

Several lawmakers welcomed the proposed amendments, which they said would boost the city’s air cargo industry and the economy.

Legislator Frankie Yick Chi-ming, who represents the transport sector, said the ban on transshipment of the cigarette alternatives had damaged the air cargo business.

He said the amendments did not signal a change of policy by the government, as the situation had changed with the establishment of the Dongguan logistics park, which he said would help ensure the products never entered the black market.

“Combating illegal activities is another issue. We should not give up eating for fear of choking,” he said.

Fellow legislator Chan Han-pan said the bulk of alternative smoking products used to be transported to Hong Kong by road, and called on the government to provide a timetable for a resumption. He added CCTV surveillance and GPS could be used to guarantee security.

But Henry Tong Sau-chai, the chairman of the Hong Kong Council on Smoking and Health, opposed the proposed changes and said he feared they would lead to criminals trying to take advantage of legal loopholes to bring the products to the city market, which would be a potential health risk.

He said the government and lawmakers should consider public health and the pressure the city’s public medical system could bear, as well as the need to instil values in young people before a decision was made.

The latest statistics, released on Monday, showed that the value of exported goods from Hong Kong fell by 10.4 per cent in October year on year to HK$374.7 billion.

The value of imported goods dropped by 11.9 per cent from a year earlier to HK$395.5 billion.

A government spokesman attributed October’s export decline to a deterioration in the external environment and continued disruption to cross-border road transport.

He added exports to the mainland, the United States and the European Union recorded double-digit declines and those to most major Asian markets also fell.

The government last year amended the law to ban the import, manufacture, sale, distribution and advertisement of alternative smoking products in Hong Kong. The amendments came into force in April.

The legislation also prohibited transshipment of the products through Hong Kong when brought in by truck or ship, although transit cargo that stayed on planes or ships that stopped off in Hong Kong was exempted.