What's happening in Intra Asia

 

Intra Asia Trade Specialists 

 

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Sino-Vietnamese direct transport helps develop closer
China-ASEAN cooperation

 


CARGO moving between China and Vietnam once had to go through complicated procedures and be reloaded onto trucks from the country before they could be carried to the destination.

But in recent years there has developed direct trucking between the two countries, eliminating the need of unloading and reloading, greatly cutting time and cost, and deepening logistics and trade cooperation between China and ASEAN countries, according to Xinhua reports.

Before the direct trucking service, reloading freight could cost a lot, said Tang Chao, a manager from a local freight forwarder in southwestern China's Guangxi Autonomous, which borders Vietnam,

He said fruit would suffer the damage done during reloading the lost amounting to 25 per cent of the total of the cost in some cases.

Since February 2012, a number of direct trucking routes were launched between China and Vietnam, including the ones from southern China port city Shenzhen to Vietnam's Hanoi, from Guangxi capital Nanning to Hanoi, from Guangxi's border city Chongzuo to Halong and from another border city Baise to Cao Bang.

These routes allow trucks from both of the countries to drive directly across the border without having to unload and reload freight at the border checkpoint, which brings much convenience to Sino-Vietnamese trade.

Indeed, China is keen to proactively propel the Sino-Vietnamese border trade activities. For example, China Development Bank has recently signed a contract with a government-run investor in Guangxi to offer a CNY150 million (US$24.69 million) loan to build a Sino-Vietnamese border-trade and logistics facility, reported Xinhua.

Puzhai has been a major border trade market on the Sino-Vietnamese border in Guangxi's Pingxiang city. Over years of development, Puzhai has become the largest market for Sino-Vietnamese cross-border trade. It is also the largest market for the fruit trade between China and ASEAN and the largest rosewood furniture market in southeast Asia.

As both quantity and categories of the border trade goods have kept increasing, the limited area of the Puzhai border trade market restricted by its geographical location can no longer satisfy the rising demand. This is also bringing inconvenience to the customs in supervising the market.

The planned border trade and logistics facility will be a solution to these problems with expanded market place and upgraded customs and inspection processes. The facility is also bound to further facilitate border trade, enhance customs clearance efficiency and become an investment attraction, said Xinhua.

The Puzhai market's annual trade value is CNY10 billion. It handles 500 trucks moving trade goods every day and 800 during peak season.

Indeed, not only can China and Vietnam take advantage of the direct trucking routes and growing border trade activities, other ASEAN countries also benefit.

The direct trucking routes have greatly driven the Sino-ASEAN trades. In 2012, China's trade with ASEAN grew 10.2 per cent year on year to a new high of US$40 million, helping China stay as the largest trade partner of ASEAN for the fourth consecutive year.

Li Jie, secretary of the Guangxi Federation of Logistics and Purchase, said that for the next step, China and ASEAN should speed up the building of infrastructures connecting the two regions to deepen their logistics cooperation.

China Federation of Logistics and Purchase vice chairman Cai Jin, said that China and ASEAN should cooperate on developing more multi-modal services and on one-stop logistics operation service to enhance efficiency and facilitate the economic integration of China and ASEAN.

According to a report published by Asian Trucker magazine, growing cross border trade will create a boom in demand for the trucking sector in southeast Asia, particularly, between Vietnam, Thailand, Malaysia, Cambodia and into south west China.

"Better road infrastructure will have the biggest impact for the inland areas across emerging markets in south east Asia, greater access will accelerate progress in development projects, attract investment and create employment opportunities in some of the poorer parts of the region," said the report.

"For trucking manufacturers the future is bright, as cross-border road freight services are increasingly attractive to customers because of improved shipper transparency and security, and the ability to offer trucking as part of a multimodal solution or as a time-definite, door-to-door service. The mode also offers more flexibility than air on cut-off times and a speed advantage compared to ocean.

As a result, manufacturing clusters are setting up along the highways to take advantage of the improved road access to the growing number of consumers in the region, boosting trades further between China and all ASEAN countries.

 

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