Chengdu, the capital city of Sichuan province, has reported breakthroughs in creating an ideal business environment by deepening reform in its free trade zone and expanding its international rail freight network and aviation services.
Local officials said that the debut of the China Railway Express, also known as the China-Europe freight train, fuelled by the Belt and Road Initiative, allowed inland Chengdu to enjoy the same advantages as cities with seaports.
The establishment of the China (Sichuan) Pilot Free Trade Zone, or FTZ, also pushed Chengdu to the forefront of global trade and industrial co-operation.
The China Railway Express (Chengdu), a direct freight line, takes only 12 days to transport goods from Chengdu to Europe, which can be two-thirds quicker than traditional shipping. The rail costs are largely the same as marine ones and about half of those of air freight. The development of the express service also allowed Chengdu’s Qingbaijiang Railway Port to explore better ways of serving businesses and drawing up new rules to support global trade.
Chengdu International Inland Port Operations Co, based in the railway port, issued its first combined bill of lading in April 2017 to offer more convenience to business. Chengdu Rongmao Lanchi Parallel Import Automobile Trade Co became first beneficiary.
Zheng Chenghuan, a board member with Rongmao Lanchi, said the company engaged in the parallel import vehicle trade at Tianjin Port before coming to Chengdu.
Rongmao Lanchi launched a new branch in Chengdu because its management believed the China Railway Express at Chengdu would bring new opportunities. However, Mr Zheng said Rongmao Lanchi’s development in Chengdu hit a bottleneck because the railway logistics service documents could not be used to raise finance, which is different from the marine bill of lading. As a result, the company paid heavy costs during business expansion.
Qingbaijiang Railway Port later decided to let companies use a combined bill of lading, which allows companies to raise finance. Independent third parties and banks are involved to monitor and control the financial risks, according to the local authority.
“Under the traditional railway freight model, companies needed to contact different logistics and express service providers to book railway services, submit documents to customs and make a transshipment,” said Chen Ran, general manager at the multi-modal transportation department of Chengdu International Inland Port Operations Co.
“The combined bill of lading makes the whole process simple and allows companies to use the document for financing.”
According to Mr Zheng, more than 100 million yuan (£11.26 million) had to be paid in advance to import 100 high-end cars without a combined bill of lading. The pre-payment can be lowered to about 20 million yuan by using a combined bill of lading.
“The combined bill of lading not only helps us reduce financial pressure, but can also protect us from the risks of foreign trade,” Mr Zheng said. By the end of last year, combined bills of lading were used in more than 1,000 deals by five companies in the automobile, wine and wood sectors, according to the Chengdu authority.
Currently, the China Railway Express (Chengdu) has 24 overseas stops. It also connects Chengdu with 14 domestic cities. Chengdu has seven international railway transport channels and five combined sea-rail channels.
Chengdu officials said the China-Europe freight train and the FTZ have attracted more investors to Chengdu in recent years. The Belt and Road industrial co-operation park in Chengdu has attracted 84 logistics trade projects, which involved an investment of 50 billion yuan. Its European industrial town has attracted 12 projects, whose total investment reached 28 billion yuan.
In 2016, Chengdu started construction of Tianfu International Airport, making it the third city in the Chinese mainland to have two international airports, after Beijing and Shanghai
Chengdu International Railway Port has established a partnership with logistics parks in Belarus, Poland and Spain in recent years. It is also planning to build an opening-up and co-operation promotion platform which combines trade, culture, technology and education under one roof.
Chengdu, home to the fourth largest airport in the Chinese mainland Chengdu Shuangliu International Airport is committed to enhancing its services, officials said. Since 1 January 2019, it has provided a 24-hour customs clearance service. Chengdu also started a 144-hour visa-free transit service to allow visitors from 53 countries to stay for up to six days, as long as they present valid documents and tickets to their next destination.
Last year, Chengdu opened more than 10 new international flight routes. By the end of 2018, Chengdu Shuangliu International Airport was operating 114 international air routes, the most in China’s central and western areas.
In 2016, Chengdu started construction of Tianfu International Airport, making it the third city in the Chinese mainland to have two international airports, after Beijing and Shanghai. The new airport is scheduled to open in 2020.
In recent years, Chengdu has spared no effort in promoting its streamlined administration and delegating powers to improve its business environment. In 2018, the business registration time was slashed from 20 days to two days. Also, the approval period for an investment project was cut to 60 days from 197 days.
Chengdu has identified 2019 as a critical year to further improve its business environment. The city’s administrators will pay closer attention to building a stable, fair and transparent environment to enhance the city’s competitiveness, according to local officials.