China to invest billions in transport infrastructure

By Staff -- Logistics Management, 9/1/1998

Trade with China is booming--that country now is the United States' fourth-largest trading partner. Although that's been good for China's economy, it has seriously strained the country's transportation infrastructure.

China's leadership recognizes the importance of an efficient transportation system to its economic well-being. To develop the necessary expertise, the government has awarded contracts to operate ocean shipping terminals and intermodal trains to experienced foreign companies.

But China won't depend entirely on outsiders for help. The government plans to spend US $230 billion over the next five years to improve intermodal transportation in that vast nation. "China wants to increase the use of intermodal freight transportation," Vice Minister of Railways Liu Zhijun told guests at a dinner hosted by Hong Kong-based ocean carrier OOCL. To do so will require a massive overhaul not only of operating procedures but of the national railway itself, he said.

Intermodal shipments in China increased 38 percent last year compared to 1996, and Liu expects that growth to continue. Improving capacity and efficiency in China's developing intermodal system, therefore, must be a top priority, he said.

According to Liu, the Ministry of Railway's plan will focus on three areas:

*Developing "reasonable" pricing for intermodal shipments and creating a uniform, single bill system;

* Improving service quality, dispatching, and container tracking capabilities; and

* Improving intermodal connections to reduce transit times. "By the end of 1998, we want to have dedicated container trains from all major ports and a maximum six-day transit to all Chinese destinations," Liu said.