Pictures of the Future    Fall 2006

From Niches to Riches

About once a minute a taxi pulls up outside the Hong Kong Sanatorium & Hospital and patients get out. Many of the "medical tourists" come here from mainland China because of the high-tech equipment, including many Siemens devices. In fact, this is the first hospital in Hong Kong to have the latest generation of Siemens computer tomographs, which use LSO-PET technology to make the most precise images available. What’s more, by halving the time required for a whole-body scan to less than 15 minutes, they increase patients’ comfort and boost the hospital’s sales. To cope with increased demand, the clinic is building several new floors.

New and updated buildings are the rule all over Hong Kong. The former British Crown Colony, which was returned to China in 1997, wants to profit from China’s booming economy—as does its neighbor, the former Portuguese colony of Macau, which reverted to China in 1999. For decades, almost all of China’s international business was conducted via Hong Kong. But now that Shanghai, Beijing and other major Chinese cities have become international trade centers, Hong Kong has had to redefine itself.

Raising the Bar. "We don’t want Hong Kong to become just another Chinese city," says John Rutherford, Associate Director General of InvestHK, a government agency that specializes in attracting international investors to Hong Kong, even though it has the world’s fourth-highest cost of living. Thousands of company headquarters or subsidiaries are located here. Last year, 23.4 million tourists, including 12.5 million mainlanders, visited the city. "Hong Kong is a premium product," says Rutherford. "We set the regional standards, and we want to keep raising the bar."

It should therefore come as no surprise that the government is planning to invest an annual $3.7 billion in infrastructure expansion over the next five years. "Siemens is already supplying solutions for many of the biggest challenges today," says Denis Leung, President and CEO of Siemens Hong Kong & Macau. "Our technology plays a major role in enabling the city to manage its dense traffic, ensuring a reliable supply of energy for seven million people living in a very small area, and providing state-of-the-art building system technology for a city with more skyscrapers than any place other than New York."

Hong Kong’s public transport system carries 7.7 million passengers each day, and some subway and suburban rail lines move more than 70,000 people per hour during peak operations. However, thanks to state-of-the-art signaling, control and communications solutions provided by Siemens, the trains can be operated flexibly. Siemens is currently installing its SCOOT traffic guidance system on the streets of the particularly densely populated districts of Tuen Mun and Yuen Long. Hundreds of sensors placed at major intersections will monitor traffic volume in order to optimally synchronize traffic lights. Siemens has already provided a traffic control and surveillance system for Aberdeen Tunnel, the major link between the southern part of Hong Kong Island and the city center as well as Kowloon on the mainland. It consists of intelligent cameras that not only automatically measure traffic densities and speeds but also recognize and register events such as accidents or traffic jams ( Video Surveillance). "By enabling drivers to receive real-time information inside the tunnel and on approaching roads, the system will help prevent jams," says Charles Cheung, head of Siemens’ Automation & Control Department.

Power Supply Record. "Siemens is transforming itself from an equipment supplier to a solutions provider," says Stewart Saunders, COO of Hong Kong’s leading power supply company, CLP Power. For example, Siemens has been dealing with one of the company’s biggest problems: the modernization of the decades-old power grid. Hundreds of substations have to be replaced without disturbing city life. Work is generally conducted at night or on weekends. Thanks to perfect organization, everything runs smoothly. In fact, engineers need only eight hours to remove a substation that serves thousands of customers, install a new one, test it, and put it into operation.

"After we’re finished, nothing will have to be done for a few decades," says Humphrey Ling of Siemens Power Transmission and Distribution in Hong Kong. That’s because while a conventional substation has to be shut down and checked every two years, the new gas-insulated substations are completely maintenance-free. As a result, CLP achieved the remarkable power-supply reliability rating of 99.99 % for the period 2003—2005. Customers only experienced an average of 5.37 minutes of unplanned power outages each year during this time, compared to 103 minutes in the United States. CLP expects this figure to fall further once the entire grid has been modernized. "Siemens has always meant reliability, quality, safety and consistency," Saunders says. "And the service that comes with the top-quality equipment is excellent." Siemens technology has also helped in the realization of other ambitious Hong Kong projects. For example, Siemens installed the safety systems for the Disneyland Park that opened in the city in 2005. And a Siemens baggage system is in operation at Chek Lap Kok Airport—for years the most user-friendly, according to surveys. Many of Hong Kong’s largest buildings—including the city’s universities, its horse racetracks and the stock exchange—are equipped with Siemens building system technologies.

"Siemens has supplied the Science Park with some great equipment," reports Carlos Genardini, CEO of the Hong Kong Science & Technology Park, which plans to use R&D as an additional economic base. "Hong Kong is close to financial markets, customers and production facilities," says Genardini. "So there’s no better place for a company with good ideas." More than 100 companies with a total of 4,000 employees are now using labs in eight futuristic buildings at the Technology Park, and new construction at the site has already started. The government plans to invest $1.5 billion in the project between now and 2011.

Gambler’s Paradise. Whereas Hong Kong is basing its economic growth on technology, its neighboring city of Macau—just an hour away by speedboat—is relying on a more irrational type of investment: gambling. In 2005, 16 million people traveled to this city of 480,000, and Macau’s gambling industry earned $5.7 billion that same year. The estimated annual rate of growth for the "industry" is 20 %. Well over half of the visitors are from mainland China—the total was nine million in 2005, or 70 % more than in 2004. That’s probably because gambling is illegal on the mainland, where the government doesn’t want people thinking they can get rich through luck rather than hard work. However, because gambling has a long tradition in China, Beijing made an exception in Macau, where mainland Chinese can tempt fate with dice and cards.

For many years, the few old casinos built during the colonial era were able to accommodate the players who came here. But with booming demand, the Chinese government has decided to create the Cotai Strip, a stretch of land 2.2 km long and nearly as wide. This gambler’s oasis will include luxury hotels, exclusive clubs and huge shopping malls and trade fair centers.

"What’s happening here now is incredible," says Jackson Chang, managing director of the Macau Trade and Investment Promotion Institute. "Twenty-one hotels with almost 20,000 rooms are under construction, and another 28 hotel projects are awaiting approval." Siemens is helping the government to establish the necessary infrastructure. For example, the company is supplying substations and control technology for the power grid, as well as building system technology for key public buildings, including the airport, the 338-m high Macau Tower and the Macau Dome, which was built for the 2005 East Asian Games. What’s more, Macau residents have a piece of Siemens’ in their pockets—their digital ID cards. In 2002, Macau became the first location in the region to introduce such ID cards. The chip in the card not only contains biometric data, including the cardholder’s fingerprints, but can also store driver’s license and health insurance data.

The lion’s share of investment in Macau is coming from the private sector and people like Sheldon Adelson, an American casino mogul. His first project in Macau—the $240 million Sands Casino—recouped its construction costs just five months after opening. Now Adelson is investing $1.8 billion in the Venetian Macau on the Cotai Strip. As with many Macau projects, Siemens is also one of the main suppliers of building system technology . "Our Siemens One concept has been very successful here," says local Siemens General Manager Alex Chu. "The builders don’t have time to deal with different suppliers." But that’s not a problem with Siemens, which provides everything from a single source. And nothing is more expensive than a casino that has to temporarily shut down because the alarm system has a loose connection. "The people putting together these big projects know they can rely on us completely," says Chu. It’s ironic, because while the customers take tremendous risks, the management leaves nothing to chance.
                                                                                                              Bernhard Bartsch