Home World News Emerging Markets China-Europe Freight Train Expansion Boosts Trade and Prosperity

China-Europe Freight Train Expansion Boosts Trade and Prosperity

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A China-Europe freight train carrying exhibits for the 4th China International Import Expo (CIIE) from Hamburg, Germany to east China’s Shanghai arrives at a freight station in Minhang district, Shanghai, Oct. 29, 2021. (Photo by Shen Chunchen/People’s Daily Online)
A China-Europe freight train carrying exhibits for the 4th China International Import Expo (CIIE) from Hamburg, Germany to east China’s Shanghai arrives at a freight station in Minhang district, Shanghai, Oct. 29, 2021. (Photo by Shen Chunchen/People’s Daily Online)

In 2011, a train loaded with electronic products sounded its horn and embarked on a journey from Tuanjiecun Station in southwest China’s Chongqing to Duisburg in Germany, marking the inauguration of the China-Europe freight train service.

Initially, the small station saw only one train depart each month. Now, it has become a first-class terminal, from which over 10 trains leave daily, reaching more than 100 cities across Asia and Europe. This epitomizes the rapid growth of the China-Europe freight train service.

As of Saturday, the total number of China-Europe freight train trips has surpassed 90,000. This extensive network currently serves 223 cities in 25 European countries and over 100 cities in 11 Asian countries, with its service covering almost the entire Eurasian continent, according to China State Railway Group Co., Ltd. (China Railway).

With deepening regional economic ties, the China-Europe freight train service — a flagship program of the Belt and Road Initiative (BRI) — has proven to be both a vital artery ensuring the continuous flow of commodities and a stabilizer enhancing the resilience of global supply chains amidst global turmoil.

GROWING POPULARITY

From 2016 to 2023, the annual number of China-Europe freight train trips surged from 1,702 to over 17,000. The value of goods transported by this service skyrocketed from 8 billion U.S. dollars in 2016 to 56.7 billion U.S. dollars in 2023.

As the Red Sea crisis disrupts vital shipping lanes and global supply chains, the China-Europe freight train service has attracted an increasing number of freight forwarders due to its efficiency, reliability, and cost-effectiveness.

The Suez Canal, through which 12 percent of global trade used to pass, saw traffic drop by 66 percent at the start of April, compared with a year earlier, said a recent report by British newspaper The Guardian. Many shipping firms are now diverting vessels to the safer, but much longer and more costly, route around the tip of southern Africa, passing the Cape of Good Hope. This can add 10 days to a journey and increase fuel costs by 40 percent.

Some companies have switched to rail freight, with the number of trains leaving China for Europe dramatically increasing in recent months, Marco Forgione, director general at the Institute of Export & International Trade, told the newspaper.

The China Railway reported earlier this month that the number of China-Europe freight train services increased by 10 percent year on year to 6,184 trips in the first four months of 2024.

With an office in Chengdu, China, Polish company Real Logistics has been engaged in the China-Europe freight train service business for nearly a decade. General Manager Pawel Moskala told Xinhua that after the outbreak of the Red Sea crisis, maritime transport between China and Europe was severely affected, while the China-Europe freight train service has played a significant complementary role in supporting goods transportation.

“Currently, the advantages of the China-Europe freight train service are evident, and demand remains relatively high. Although it is difficult to predict long-term trends in sea freight prices, overall, given the current international situation, rail transport is expected to grow substantially, and the China-Europe freight train service will also see growth and will continue to play an indispensable role,” he said.

Echoing this sentiment, He Daoguo, general manager of Chongqing Meilian International Warehouse & Transport (Group) Co., Ltd., stated, “Train trips departing from Chongqing to Europe can now arrive within 15-20 days, which is 7-10 days faster than shipping through the Red Sea. China-Europe freight trains have acted as a stabilizer for global supply chains due to their resilience, stability, and punctuality.”

Chen Fengying, a researcher at the China Institutes of Contemporary International Relations, noted that in the unstable geopolitical context of the Israeli-Palestinian conflict, sea transportation has been affected and prices are rising, whereas land transportation remains relatively cheap and safe.

“The China-Europe freight train service has, to a certain extent, ensured the security and stability of industrial and supply chains, injected stability into economic and trade exchanges, and played a significant role in maintaining stable trade relations worldwide,” the scholar added.

EXPANDING SERVICE

Last Monday, a cargo train carrying 50 twenty-foot equivalent units (TEUs) of goods departed from Huanghua Port in Cangzhou, located in north China’s Hebei Province, en route to Moscow, the capital of Russia, launching a new international route for the China-Europe freight train service.

Less than two months ago and also in Hebei, a new international freight train route linking the city of Shijiazhuang with Belgrade, the capital of Serbia, began operations. Hailing the China-Europe freight train service as a more efficient way to connect China with Europe, Bojan Stanic, assistant director for Strategic Analysis & Data at Chamber of Commerce and Industry of Serbia, said that Serbia is a key point in the BRI, and this train will reduce logistics costs and bring benefits to both countries.

As the demand for rail transport between China and Europe grows, the China-Europe freight train service has seen significant network expansion and service upgrades in recent years.

Chongqing launched its first China-Europe freight train to Istanbul, Türkiye in February. Industry insiders believe that amidst frequent conflicts, the Istanbul train service has enhanced the corridor connecting western China with Europe, and bolstered the risk resistance and development resilience of the China-Europe freight train service.

“The train services provide a guarantee for the timely arrival of our goods and effectively reduce our operational risks,” said Zhang Rong, deputy general manager of Yuxinou (Chongqing) Logistics Co., Ltd., the operator of China-Europe freight train service in Chongqing.

Along with the network expansion, the China-Europe freight train service has also experienced impressive enhancement in transport capacity, efficiency, and service quality.

“To ensure the smooth operation of the trains, we have maintained timely communication with export enterprises and enhanced the application of ‘automatic clearance.’ We efficiently connect the processes of declaration, document review, and inspection, continuously monitoring the progress of customs clearance and railway manifests,” said Chen Yuanjun, deputy director of Yuzhou Customs in Chongqing, adding they also maintain close contact and coordination with the customs authorities of the destination countries to ensure smooth transit and loading processes.

In Xi’an, northwest China’s Shaanxi Province, a freight terminal was jointly launched by KTZ Express — a subsidiary of Kazakhstan’s national railway company Kazakhstan Temir Zholy (KTZ)– and Xi’an Free Trade Port Construction and Operation earlier this year. The China-Kazakhstan (Xi’an) Trade Logistics has been built to further facilitate goods transportation between China, Kazakhstan, Central Asia and Europe.

Alebekov Olzhas, vice general manager of the Chinese branch of KTZ Express, has been actively involved in the planning and construction of the terminal since 2023. “In the past, customs declaration could take an entire day. Now, with our companies sharing information and data, KTZ prepares for clearance procedures before the trains arrive at the port, reducing the process to less than 15 minutes,” he noted.

DELIVERING PROSPERITY

As an exemplar of win-win cooperation, the China-Europe freight train service has enhanced regional opening-up, expanded economic and trade exchanges, and improved people’s well-being in countries along the routes.

Duisburg, located in Germany’s industrial heartland Ruhr area, is one of the most important hubs for China-Europe freight trains. Having once witnessed coal and steel drive its prosperity, the city is now renowned as Europe’s key trading gateway to Asia thanks to the arrival of the railway route, which continues to inject vigorous impetus into Chinese-German exchanges and cooperations.

Soeren Link, mayor of Duisburg, has seen the comings and goings of the China-Europe freight trains for over a decade. Thanks to the China-Europe train route, Duisburg has been the European logistics hub under the BRI for a decade, said the mayor. “Trains carrying goods from China arrive at the port of Duisburg every day, which are then forwarded directly to over 20 major European cities.”

Link noted that the freight train connection between China and the city of Duisburg remains a preferred alternative to sea and air freight for companies. He added that Duisburg is now home to more than 100 Chinese companies across various industries, including logistics and e-commerce. “We welcome Chinese specialists and managers who enrich the local economy with their business projects,” he said.

The China-Europe freight train is a tool and an instrument to connect many more parts of the Chinese and European economies than by sea and air cargo, said Markus Bangen, CEO of Duisport, a German company running the port of Duisburg. “The freight train is the link which can help us even work stronger and tougher together,” he said.

On the other end of the rail route, China’s Chongqing has been leveraging the advantages and brand effects of the China-Europe freight trains to promote high-quality development of industries such as electronics, automobiles, and machinery.

Changan Auto, a major carmaker in the city, achieved record-high overseas sales of over 230,000 units of its own brand vehicles in 2023, many of which were new energy vehicles (NEV) and transported by rail. Since the beginning of 2024, Changan has exported 11,550 vehicles via China-Europe freight trains.

Since 2023, an increasing number of Chinese-made “tech-intensive green trio” products — lithium-ion batteries, photovoltaic products, and NEVs — have been transported through the China-Europe freight trains, reflecting strong market demand, said the China Railway.

Thomas Krajnicki, 57, is a staff member at Yuxinou (Chongqing) Logistics Co., Ltd., the operator of the railway express linking Duisburg and Chongqing. Having worked for the company for five years, he said it is not common to get such a secure job at this age and he feels comfortable working for the company.

“I hope the traffic of goods will increase, my job will be stable … and the contacts and cooperation between Duisburg and China will be further deepened,” said Krajnicki.

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