Business
19:05, 24-Apr-2018
China's logistics robust growth in Q1 while challenges remain
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The report released by the Chia Federation of Logistics and Purchasing (CFLP) on Tuesday showed that China's logistics industry maintained its robust growth in the first quarter of this year, and China’s overall logistics value increased year-on-year by 7.2 percent, up to more than 62 trillion yuan.
China's economic development has been accompanied by the ever-increasing demand for logistics services. A data breakdown indicates that industrial products remain the main driver of the total logistic value. Meanwhile, consumption logistics saw a sizable expansion due to the high active level in the e-commerce market.
“The overall trend of China's logistics sector is positive, especially in consumption logistics. China's logistics market is still expanding. We think there is still plenty of room for it to grow,” said He Hui, the deputy director of China Logistics Information Center.
China's logistics sector brought in a total of 2.1 trillion yuan in revenue, up 8.2% from the previous year. At the same time, its costs are declining. The CFLP data shows the ratio of total logistics costs to GDP was 14.5% in the first quarter, down 0.4 percentage points from the same period last year. Analysts credited the policy shift to the falling costs.
“Preferential policies have been put in place. That has significantly boosted the efficiency of the whole industry. Combined with improvement in management and technology application, that has greatly reined in the total logistics costs,” He added.
He Hui also pointed out there are still some areas that can be improved to further cut logistics costs. For example, the logistics facilities in some regions are either insufficient or redundant and transportation of goods via road, rail, ports and airways hasn't been fully integrated. In addition to this, high toll fees and hikes in labor costs also eat into enterprises' profits.