Yangtze trade link faces hitch

PUBLISHED : Monday, 07 November, 2011, 12:00am
UPDATED : Monday, 07 November, 2011, 12:00am


The mainland is facing a raft of challenges in developing the Yangtze River as a key conduit that will facilitate the growth of its central and western regions, according to a senior shipping executive.

Bronson Hsieh, vice-chairman of Taiwan's Evergreen Group, said mainland authorities should confront issues such as the need to improve the river's navigability and to develop of multimodal transport facilities.

Hsieh pointed out that cargo volumes at inland ports had been growing faster than at coastal ones. Last year, inland ports saw an 18.1 per cent increase to 2.6 billion tonnes in freight, compared to a 15.3 per cent rise to 5.5 billion tonnes of cargo at sea ports, he said, quoting Ministry of Communications figures.

Liu Xihan, president of Sinotrans & CSC Holdings, said 1.3 billion tonnes were handled by ports along the Yangtze last year. This is expected to rise to 1.7 billion tonnes by 2020.

Both Hsieh and Liu were speaking at the World Shipping (China) Summit at Boao, Hainan Island.

Hsieh said traffic on the Yangtze would 'run smoother only if the Jingjiang section [could] be improved', referring to the 347-kilometre stretch from Zhicheng in Hubei province to Chenglingji in Hunan.

He said the section often clogged shipping, especially during the dry season when low water levels limited the size of ship that could travel on the river.

Hsieh also said there was a lack of investment to improve the navigability of the Yangtze, with the funds spent on river improvements just 3.6 per cent of the amount spent on the Beijing-Shanghai high-speed railway under the 11th five-year plan.

Compared with the national railways budget, he said money spent on the Yangtze was 'nearly nothing' - equivalent to just 0.4 per cent of total railway spending.

The Evergreen executive called for the development of a multimodal transport network to improve cargo flows between the river and railways.

About 80 per cent of the mainland's cargo is transported by road, which is partly why logistics costs - at 18 per cent of China's gross domestic product (GDP) - are high, according to Hsieh. In contrast, the cost of moving cargo in the United States and Europe accounts for about 9 per cent of their GDP.

Hsieh says only 3 per cent of the mainland's domestic cargo is packed in containers, while transshipment volumes from water to railways account for just 2 per cent of total port throughput. He added the volume of containerised domestic freight and intermodal cargo transfers through ports were 'commonly above 30 per cent in developed countries'.

Several companies - including China United International Rail Containers, a joint venture led by China Railway Container Transport and NWS Holdings - have facilitated the development of train container services, but Hsieh said the lack of multimodal networks has placed a huge burden on costs and efficiency.

The railway containers venture is building a network of 18 container terminals at strategic locations, with depots in Shenzhen, Guangzhou, Beijing, Ningbo and Shenyang among the nine terminals due to open next year.

DB Schenker, an offshoot of the German railway company, is also due to launch a daily rail container service from Germany to China later this month. The service will transport containers loaded with BMW car components from Leipzig to the BMW plant in Shenyang.

DB Schenker has already made four trial shipments before the launch of the daily service, which will be twice as fast as moving the containers by ocean freight even though the containers have to be transferred twice to different train wagons because of changes in the width of the track in Belarus and China.


The percentage of Hong Kong's throughput in 2008 that involved cargo movements between the mainland and the city's ports