The Airport Authority of Hong Kong is in talks with its Shanghai counterpart for a stake in the planned cargo section in the second phase of Pudong International Airport to enhance its presence in the mainland aviation market.

But there are still some differences between the two parties and no paper documents have been signed yet concerning the cooperation, according to the Shanghai Airport Authority.

"The Hong Kong party has expressed their interest," said an official with the information department of Shanghai Airport. "There have been some contacts, and we also have the wish (to cooperate with them)."

But the official stressed the divergence, which has not been clarified, adds to the uncertainty of their talks.

The cargo section is part of the Pudong Airport second phase project, which started last December and will double passenger and air-cargo volume at the airport by 2015, solidifying its statue as a major regional transport hub.

The freight volume will reach 4.4 million tons by 2010 for the cargo section that can deal with 3 million tons a year. The big cargo section has already attracted UPS, which signed a memorandum with Shanghai Airport last year for a transfer center that can handle 200,000 tons of cargo a year when the section is operational.

Li Derun, the Shanghai Airport vice director, said the advanced management concept of Hong Kong airport will help them meet international standards and the two parties' cooperation in cargo transport and personnel training will further deepen.