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China`s land connectivity: thinking big

Focused on spreading growth and development to China’s less-developed areas by linking north-western and north-eastern Chinese regions to Central Europe, South and West Asian countries, China`s 21st Century Silk Road Economic belt is gaining traction.



Volumes of container cargo travelling between China and Europe by rail are growing as operators increase frequencies and state organisations along the route lend their weight to the development of new services. Two-way services from Asia’s largest railway hub in the city of Chengdu (China home to more than 260 Fortune 500 companies) in southwest China’s Sichuan province to Lodz in Poland have been increased from twice weekly to five times per week. The overland route appeals in particular to electronics and automotive industry manufacturers because the value lost on goods such as computer components and engines during the longer sea journey is relatively high.



The Chengdu-Europe Express Railway Service, which started in April 2013, carries IT products, automobile parts, and clothes from China to Europe, and food and beverages in the other direction. German-owned DHL offers temperature-controlled container services on the route.



Other landbridge services are also expanding. Trans Eurasia Logistics (TEL), a joint venture between Germany’s national rail company, Deutsche Bahn, and Russian Railways, launched a new regular weekly service between Wuhan in central China’s Hubei province and Hamburg earlier this year.



TEL operates one of the largest and most famous landbridge services between China and Europe. The ‘Yuxinou’ service is an 800 m-long container train that travels between Chongqing in southwestern China and the German port city of Duisburg three times a week and five times in peak season.



Rail services to Europe are now also offered at several other Chinese cities, including Zhengzhou and Changsha in central China, and Shenyang and Harbin in the northeast.



As the world’s top exporting nation, China has an interest in simplifying its transport access to Europe, its leading market. Diversification away from sea transport through the creation of more land-based routes, especially high-speed train links is reducing average transport times by several working days. Initial activities have be geared towards building basic infrastructure, a sector where China is well-equipped to provide engineering skills, construction experience, machinery and equipment as well as materials such as cement and steel in which it has excess capacity. EU-China trade is likely to get an important boost from the expected reduction in transport time and costs while EU exporters and investors will gain access to new growth markets in inland China and Central Asia.



Environmental & Economic issues are also at the fore where the carbon footprint of rail transport is typically about one-thirtieth that of air freight, whilst delivery times are about half of that required by sea freight.



Increased EU-China connectivity is increasing bilateral trade, investments and creating new business opportunities for European, Central Asian and Chinese enterprises as well as boosting employment, growth and development.





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