Qingdao makes major moves in cross-border trade

The Qingdao West Coast New Area Bonded Logistics Center was busy after the "Double 11" online shopping spree, which lasted from around the beginning of November until Nov 11, where workers from e-commerce platforms feverishly sorted parcels coming from around the world and heading all over the country.

The center received more than 300,000 international parcels during this year's online shopping extravaganza, increasing threefold year-on-year.

Qingdao, in East China's Shandong province, is a relative newcomer to cross-border e-commerce. It acquired qualification for bonded goods operations in 2018, which allows it to import shipments to be kept in an area of warehouses under special monitoring by Customs authorities on which Customs charges remain until they are sold through online shopping platforms.

The bonded goods enjoy zero duties within a certain amount, and value-added and consumption taxes are levied at 70 percent of the legally payable tax amount so that monetary costs and time spent are greatly reduced for both individual consumers and companies.

Nearly 80 cross-border e-commerce operators have settled in the Qingdao West Coast New Area where 1.28 billion yuan ($195.07 million) worth of goods were handled in the first eight months of the year, a 4.5-fold increase from a year earlier.

"The biggest advantage of the area is its geographic location not far from Japan and South Korea, allowing it to become a hub of cross-border e-commerce in China linking the world, especially trade between China, Japan and South Korea," said Liu Baojun, vice-president of the logistics center.

A China-Japan-ROK Consumption Zone E-commerce Experience Center opened on Aug 30, bringing together trendy products from Japan and South Korea as well as other countries. Cosmetics, daily necessities, kitchenware and healthcare items were among the products.

Adjacent to the fully automated Qingdao Port and the multimodal transport logistics center, the 42-hectare bonded logistics center is expected to become a "super warehouse with all transportation modes available, and seamless access to the port", Liu said.

Although traditional international trade has faced challenges amid the COVID-19 outbreak since the beginning of the year, authorities of the new area have integrated resources of many departments, including Customs, post, finance, commerce, transportation and administrative services, thus shifting focus to cross-border e-commerce.

The local government set up a 100 million yuan fund to support cross-border e-commerce platforms, build warehouses and logistics systems, train professionals and improve financial services.

"Despite the impact of the pandemic, we have witnessed satisfying growth," said Ma Ruilong, who started doing cross-border e-commerce in 2017 and moved his company to the West Coast New Area in May.

Ma's trading company focuses on fast-moving consumer goods businesses such as hairpieces and cosmetics. He said nearly 80 percent of the world's false eyelashes are made in the Pingdu area of Qingdao, so moving the company to Qingdao means a 20 percent increase in logistics efficiency and millions of yuan in annual cost reductions.

"The infrastructure, policies and services in the West Coast New Area are second to none," Ma said. "Also, a vocational training system combining efforts from the local government, schools and companies has generated a stable and high-quality workforce."