VZCZCXRO1401
OO RUEHCN RUEHGH
DE RUEHHK #2650/01 1780912
ZNY CCCCC ZZH
O 270912Z JUN 06
FM AMCONSUL HONG KONG
TO RHMFISS/DEPT OF HOMELAND SECURITY WASHINGTON DC IMMEDIATE
RUEHC/SECSTATE WASHDC IMMEDIATE 7485
RHMFISS/DEPT OF ENERGY WASHINGTON DC IMMEDIATE
INFO RUEHBJ/AMEMBASSY BEIJING PRIORITY 8944
RUEHUL/AMEMBASSY SEOUL PRIORITY 2575
RUEHGP/AMEMBASSY SINGAPORE PRIORITY 2975
RUEHTC/AMEMBASSY THE HAGUE PRIORITY 2287
RUEHKO/AMEMBASSY TOKYO PRIORITY 4142
RUEHCN/AMCONSUL CHENGDU PRIORITY 0858
RUEHGZ/AMCONSUL GUANGZHOU PRIORITY 9864
RUEHGH/AMCONSUL SHANGHAI PRIORITY
RUEHSH/AMCONSUL SHENYANG PRIORITY 3346
RUEHIN/AIT TAIPEI PRIORITY 3948
RULSDMK/DEPT OF TRANSPORTATION WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY

C O N F I D E N T I A L SECTION 01 OF 03 HONG KONG 002650 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
DEPT FOR EAP GDAVIES AND ISN/NC FRECORD 
NSC FOR ROOD AND WILDER 
ENERGY/NNSA FOR JPAUL/DHUIZENGA 
DHS FOR DEPUTY SECRETARY JACKSON 
CBP FOR WRBASHAM/JAHERN/DKTHOMPSON 
 
E.O. 12958: DECL: 06/27/2031 
TAGS: PTER PREL PGOV ECON EWWT HK CH
SUBJECT: PORT SECURITY:  STRENGTHENING THE FIRST LINE OF 
DEFENSE IN HONG KONG 
 
REF: A. A) HONG KONG 588 
     ¶B. B) HONG KONG 1467 
     ¶C. C) HONG KONG 1470 
     ¶D. D) HONG KONG 1468 
     ¶E. E) HONG KONG 2373 
 
Classified By: Consul General James B. Cunningham.  Reasons: 1.4 (b,d). 
 
Summary 
-------- 
 
¶1. (C) We have the opportunity in Hong Kong to establish the 
world standard the U.S. seeks for port and container 
security.  U.S. views will have decisive impact on Hong 
Kong,s future direction, and on the region as well.  The May 
28-29 visit of DOE Assistant Deputy Administrator Huizenga's 
interagency team (Ref E) built on Secretary Chertoff,s visit 
(reftels B, C and D).  In the course of his discussions on 
Megaports and radiation screening, Huizenga confirmed that 
the U.S. in principle wants a container screening 
architecture that combines private sector-provided imaging 
and radiation detection.  If that is the U.S. intention, we 
should move now to take the discussion to the next level.  If 
we can flesh out this vision, and elaborate a concept of 
operations, even as technical refinements are being developed 
and tested, we can address  the concerns of Hong Kong 
partners in government and industry who are disposed to work 
with us to make this architecture a functioning reality. In 
sum, if we want to use Hong Kong to set the world standard 
for cargo inspection, the U.S. needs a coordinated and clear 
message of what we intend, and how the parts fit together. 
With that message, we can engage the HKG and the terminal 
operators to bring them on board. End summary. 
 
¶2. (C) The container screening architecture established in 
Hong Kong should have global repercussions, given the 
importance of Hong Kong for shipping to the U.S. (and Europe) 
and the global footprint of Hong Kong's port terminal 
operators.  Their facilities handle at some point 37 percent 
of worldwide cargo. In 2005, Hong Kong's port shipped more 
cargo to the U.S. than any other port in the world.  Hong 
Kong-headquartered Hutchison's facilities around the world 
alone handle 45 percent of all U.S. cargo at some point 
before entry into the U.S. Since the Hong Kong port security 
architecture  will likely become the standard for mainland 
ports as well, at least in Southern China, its impact on 
shipping to the U.S. will be further magnified.   We 
understand that Hong Kong is the only port that is testing 
anything like the private-industry Integrated Container 
Inspection System (ICIS), which combines radiological and 
x-ray scanning, cargo tagging, and maintenance of electronic 
files on every screened container.  Li Ka-Shing made clear in 
his meeting with Secretary Chertoff (Ref C) that Hutchison is 
firmly behind the ICIS concept,  if that's how the U.S. 
decides to go. 
 
¶3. (C) Following the Huizenga visit, the Hong Kong Government 
(HKG) wants more information about the details of the U.S. 
model before we nail down something with private industry. 
That is, the HKG does not want to be presented with a fait 
accompli, since implementation will undoubtedly have resource 
and other implications.  However, this desire for 
consultation in advance of a final decision should not be 
mistaken for a lack of interest, or for opposition. 
 
¶4. (C) The HKG wants both to enhance security and to maintain 
the leading role of its port as long as possible, in the face 
of intense competition from mainland facilities in Shenzhen 
and Shanghai.  The Government is concerned that container 
security measures  not obstruct port operations, create 
 
HONG KONG 00002650  002 OF 003 
 
 
competitive disadvantages, or create a large additional 
workload for Hong Kong Customs.  They want more clarity on 
Hong Kong and U.S. responsibilities under a new 
CSI/ICIS/Megaports architecture.  They would hope to see a 
commercial advantage for the ports whose terminal operators 
participate in U.S.-mandated screening, but the key thing is 
that they not be disadvantaged.  Chief Executive Donald Tsang 
stressed to me the need not to disrupt in-stream transfers 
from ship to ship, e.g., by requiring all containers to touch 
land (in fact, we are told that almost no containers get 
loaded onto a U.S.-bound vessel without going through the 
terminal portal on land.)  The Government, the terminal 
operators and the shippers all hope that containers that pass 
through robust radiological screening and imaging could be 
"green laned" when they reach the U.S. 
 
¶5. (C) For their part, terminal operators in Hong Kong and 
the region have made clear, including in a May 30 letter to 
Secretary Chertoff, that they are willing to cooperate but 
 
SIPDIS 
are still looking for a firm signal from the U.S. on the 
concept it intends to pursue, and on U.S.  commitment.  The 
Huizenga team meeting with regional terminal operators made 
the point that the operators will not use security as a 
competitive factor, and that they all want to use the same 
standard.  Terminal operators here are confident that 
virtually 100 percent x-ray scanning and radiation screening 
of traffic bound for the U.S. (as well as other traffic 
entering their terminals) is possible.  They too need 
reassurance about what will be done with the information 
obtained at their expense.  The operators would like to 
enhance the security of the global maritime transportation 
system, not just traffic going to the U.S.  This raises an 
issue with Hong Kong Customs, which is concerned about the 
personnel needed to inspect alarms generated by traffic not 
destined for the U.S. as well as U.S.-bound containers.  This 
is an issue for both Megaports screening and ICIS-type 
imaging and screening. 
 
¶6. (C) The terminal operators, in their May 30 letter, asked 
for "confirmation from the USG that our integrated scanning 
approach is a proper next step and that the screening data 
will be used by government to increase container security. 
If the approach to integrate radiation detection with cargo 
imaging adds value to the targeting process, we need the U.S. 
government to give us an acknowledgement on that point and we 
will commit to deploying the technology on a port-wide 
basis."  They urge working together "to develop mutually 
agreed operating procedures and protocols."  That is, the 
operators already support the imaging concept, and are also 
willing to integrate radiological screening into the overall 
system here -- if that is what the U.S. proposes, and if the 
U.S. commits to developing the operational details and 
protocols with the operators and the Hong Kong government. 
 
¶7. (C) The Hong Kong Government is looking to us for guidance 
as to how we see this effort moving forward globally.  We 
must tell them what we believe is required, tell them we are 
moving ahead, and bring the operators on board to stimulate 
HKG approval.  Hong Kong is already lagging progress on 
Megaports elsewhere.  It can jump ahead of the pack with an 
integrated Megaports/ICIS type operation linked to CSI. 
 
¶8. (C) We recommend we be given points for presentation to 
the HK Government, which could be used as a basis as well for 
responding to the HK Container Terminal Operators May 30 
letter. 
 
¶9. (C) The message should urge support for an integrated 
cargo screening architecture that combines CSI, radiological 
monitoring and private industry x-ray scanning, with the 
 
HONG KONG 00002650  003 OF 003 
 
 
resulting images sent to the U.S. CSI team. We need to 
clarify the operational concept for use of the data with Hong 
Kong customs, the relationship of Megaports DOE-provided 
monitors to the architecture, and the impact of screening of 
non-U.S. bound traffic.  We should assure the HKG that the 
general concept has strong support throughout the USG, 
including in the Congress, and that all the agencies involved 
are working together to solve integration and implementation 
issues.  The points should address the HKG's concerns about 
resource implications of such a system, including the role of 
spectroscopic monitors in evaluating alarms.  They should 
present our preliminary thoughts on how the data will be 
analyzed and shared with the HKG, i.e., if it will be done by 
an augmented CSI team or by U.S.-based analysts. 
 
¶10. (C) The Huizenga visit clarified that there are technical 
problems with radiation screening (whether done by ICIS or 
Megaports monitors), but similar problems have been resolved 
elsewhere in Asia.  We understand a technical team is headed 
here in late June to explore the solution to the background 
radiation problem and the establishment of a data link to 
CSI.  We should assume that the technical problems with 
radiation monitors will be resolved here, as they have been 
elsewhere. Doing so here over the next 3-4 months should not 
delay elaboration of the conceptual framework and discussion 
of it with Hong Kong authorities. 
 
CUNNINGHAM 
Cunningham