Railway links open up inland Chengdu

The city in Southwest China is strengthening its role as a logistics hub for Europe and Southeast Asia

A freight train hauling a full load of electronic components left Chengdu, capital of Southwest China's Sichuan province, on Sept 30, arriving 13 days later at its destination of Prague in the Czech Republic.

This is the seventh route of the Chengdu-Europe direct freight train service, which first began in 2013. Routes to Lodz in Poland, Nuremberg in Germany, Tilburg in the Netherlands, Almay in Kazakhstan, Minsk in Belarus and Moscow in Russia have also been established.

Local officials said the nearly 10,000-kilometer-long Chengdu-Prague route is a new move to deepen Sichuan's cooperation with regions and countries involved in the Belt and Road Initiative.

Sichuan-based household appliance giant Changhong Group chartered the first train for the Chengdu-Prague route, delivering electronic components and equipment to its production site in the Czech Republic.

Changhong is one of the earliest Chinese electronics manufacturers to expand into international markets.

Since it set up its first overseas office in Indonesia in 1999, Changhong has established business operations in more than 20 countries and regions - all related to the Belt and Road Initiative.

Changhong began to build its production plant in the Czech Republic in 2005. It came into operation in 2007.

The company's Czech research and development center was established in May last year. It was the first R&D center that a Chinese appliance company had ever built in the country.

"Through the Chengdu-Europe freight train, we can directly deliver our components, products and equipment to our factories in Europe, greatly decreasing our logistics costs and increasing production efficiency," said Huang Dawen, deputy general manager of Changhong.

Relying on Changhong's office in the Czech Republic, Sichuan has established a representative office in the country. Through the office, enterprises from the province and wider western China can expand their markets in the Czech Republic and Europe as well.

"Changhong has carried out an overall globalization strategy, in terms of products, technology, human resources, capital and branding," Huang said.

He added that his company has more than 2,000 employees overseas, of which 80 percent are locals. Changhong products have been sold in more than 120 countries and regions.

Huang said Changhong has 14 subsidiaries involved in production and sales, three R&D centers and seven representative offices in foreign countries.

Echoing the Belt and Road Initiative, Changhong has set new goals for its global development. According to Huang, the company plans to garner more than 30 percent of its revenue from overseas sources by 2020.

The first Chengdu-Europe direct freight train opened in April 2013. Local officials said the channel offers the most cost-effective transportation means for cargo to fl ow between Southwest China and Europe.

According to the transport authorities in Sichuan, the travel time through the railway system is only one-third that of ocean shipping routes, while the cost is only one-sixth that of air routes.

They said that by the end of September, more than 600 such trains had delivered $2.8 billion worth of goods between Chengdu and Europe.

The freight train system has also attracted manufacturers from outside Sichuan.

For instance, TCL, a household appliance producer based in Huizhou, Guangdong province, first chartered a freight train on March 26 last year to haul its delivery to Lodz, Poland.

TCL products were dispatched from Huizhou, then transshipped to the Chengdu-Europe freight route to Lodz.

Huizhou itself is a port city. However, ocean-going liners take about 40 days to travel to Europe, while the train takes only two weeks.

TCL executives said the company is planning to transfer part of its production capacity to Chengdu to further shorten the shipment distance.

Sun Ling, an official in charge of international freight train operations in Chengdu, said the city is planning to extend its freight train services to Southeast Asia by the end of this year.

With the international train services, Chengdu is expected to become a transportation hub oriented both to Europe and Southeast Asia, despite being an inland city, local officials said.

zhaoshijun@chinadaily.com.cn

(China Daily European Weekly 10/20/2017 page11)