Xi'an goal to be northwestern logistics hub

With overseas companies shifting the tapping of cargo sources from coastal to inland areas, Xi'an, the birthplace of the ancient terracotta warriors, is speeding up the upgrading of its facilities to cash in on the business. The city, in northwest China, hopes to become the logistics hub for the region.

The key project of the city is the development of the Xi'an International Trade and Logistics Park (above), which is expected to adopt "fully open" logistics policies and serve as the country's largest inland Customs port.

"We're prepared to bridge the gap between Chinese coastal ports and inland cities," said Han Song, vice-mayor of Xi'an, who is also director of the park's administrative committee.

As more and more industries and logistics companies move west from the coastal areas, Xi'an central authorities eased regulations for businesses in June to boost development of the region, said Wang Ming, deputy director of the integrated transport institute with the State Development and Reform Commission. "Xi'an is catching up with the latest trend," he said.

The Xi'an logistics park, covering 44.6 sq km in the northeastern part of the city, includes a comprehensive bonded logistics centre, a container rail hub, and a distribution centre for goods moved by road.

The bonded centre, which began operations in April, plays the role of a special Customs office, said Qiang Xiao'an, executive deputy director of the park's management committee. Nine bonded logistics and Customs clearance companies handled more than US$4.4 million worth of cargo between May-September, he noted.

The park plans to turn its bonded logistics centre into a comprehensive free trade zone. It will adopt functions that are identical to coastal ports in bonded services, information sharing, Customs clearance, warehousing, processing and cargo distribution.

In the near future, the Xi'an free zone will provide the most favourable policies to businesses and full and complete services," Han said.

Industry experts estimate that the Xi'an area could help cargo operators cut their costs by at least $45 per standard container once the Customs clearance, inspection, quarantine and containerising operations are completed compared with traditional handling of cargo.

The railway container terminal will become one of the country's most advanced redistribution centres, Han said. By the end of this month, an international container yard for Customs supervision will be put into operation at the terminal, which will pool rail containers to the park from other railway stations in and around Xi'an.

Eight highways costing $49 million have been built to feed the park with container traffic.

Loh Chun How, a senior manager for North Asia of APL Ltd, said rail containers are destined to play a bigger role in China-related transport like in the US when rail transport was developed late in the last century following the development of sea links to the country.

In Xi'an, 130,000 TEUs were handled by the railway last year despite the financial crisis. The growth in rail container traffic already exceeds the designed capacity of the existing Xi'an railway stations.

The park's road terminal will offer extensive transport services both on land and online for the whole of northwest China. Its highway Customs supervision centre was opened on September 28 to oversee incoming and outgoing cargo.

Han said the Xi'an International Trade and Logistics Park will have six major functions: offering all necessary Customs port services identical to those at an international coastal port; serving cargo distribution and transhipment in and out of China; providing facilities for third-party logistics businesses; sharing the global chain supply information platform; engaging in value-added processing, and developing commerce and holding exhibitions.

"We're working to achieve seamless multimodal transport that links western China with the Bohai Rim and the Yangtze and Pearl River deltas," said vice-mayor Han.

"The goal is to make Xi'an the largest inland Customs port of China, a supply chain hub in northwestern China, and a global trade and transport centre."

The building of the park itself represents the gradual internationalisation of inland logistic parks, said Professor Chen Kuanmin with Xi'an-based Chang'an University. The Xi'an park is key to lifting the level of containerisation and international supply chain in Northwest China, he added.

Compared with coastal regions, western China has yet to develop its containerised areas. The Xi'an rail container centre could drive the process thanks to its position in the Eurasia continental bridge. "Things here in the park may not be perfect, but it's exactly what is most needed in western China," Chen said.

The Xi'an logistics park has inked agreements on land-sea cargo transport with coastal ports including Shanghai, Lianyungang, Qingdao and Tianjin, as well as western border passes such as Horgas and Alashan. Tianjin Port has even built up a service centre for Xi'an.

Multinationals and logistic heavyweights such as Walmart, Maersk, Sinotrans-Changjiang, Legend, Geely and China Mobile are expected to set up projects inside the zone. To date the area has contracted 48 such investment projects worth $9 billion.
(Source:www.cargonewsasia.com)