Currently, high logistics cost has become a major factor that restricts the economic development of China. How to control logistics cost and reduce burden on enterprises has become a focus of the logistics industry.

 

Recently, the Ministry of Transport of the People’s Republic of China issued the Several Opinions on Promoting Structural Reform at Supply Side to Propel Cost Saving and Profit Increasing of Logistics Industry, which focuses on promoting an intensive, intelligent and standard development of the logistics industry to propel cost saving and profit increasing and inject new vitality for China’s economic transformation and upgrading and high-efficiency operation.

 

It was learnt that it is currently an urgent need to promote reduction of logistics cost of enterprises engaged in real economy for the structural reform at the supply side. Therefore, the Opinions specify 19 tasks concerning five fields for the cost saving and profit increasing of the logistics industry through transportation. By 2020, an economical, convenient, efficient and high-quality transportation logistics service system will have been basically built up; support will have been provided for the construction of about 150 freight hubs (logistics parks) as well as railways and roads of about 3,000 kilometers connecting with major distribution ports; a number of logistics enterprises of certain size and with networked platforms will have been developed; about 50 pilot projects for NTOCC (Non-track Operating Common Carrier) road freight will have been launched; average annual increase of proportion of railway-waterway combined transportation of containers at major ports will have reached about 10%, while proportion of railway freight container transportation will have reached 15%, and standardization rate of vehicle transporters and other heavy trucks will have reached 80%.

 

In accordance with the Opinions, great efforts will be made to develop multimodal transportation, continuously promote drop and pull transportation, improve rural logistics service network, drive integrated regional development of transportation logistics, further facilitate cross-border transportation and comprehensively propel high-efficiency operation of transportation chains to provide substantial support for the new-type urbanization, development of regional integration and “the Belt and Road” construction. In addition, the Ministry of Transport will improve the supporting standard system to further streamline administration and delegate power to the lower levels, improve law enforcement for toll administration and supervision, standardize charges for railway, port and airport services, establish and improve the credit system of the logistics market, promote the implementation of the policy to replace the business tax with a value-added tax in the logistics industry, and create a standardized and ordered market environment.

 

To put the Opinions into better practice, the Ministry of Transport made the Three-Year Action Plan for the implementation of the Opinions at the same time to set 29 detailed sub-tasks with specific timetable for fulfilling the major tasks to substantially guarantee the effectiveness of the practice to save cost and increase profit of the logistics industry through transportation.

 

Source: Translated from Invest Guangzhou, August 16, 2016