Why is China Expanding EU Freight Train Services to the Nordic Countries?
Finnish transport company Nurminen Logistics launched a new rail freight route between Helsinki and Chongqing in Southwest China. The new route will mainly be used for cold storage transportation of Norwegian salmon to China, but other freight is also planned. Nurminen Logistics already operates a rail container route between Helsinki and Hefei. The new route to Chongqing is meant to meet the growing demand for freight services.
To learn more about China’s expanding freight train services to the EU, Shane Bigham invited Adjunct Professor Ivo Ganchev (Beijing Union University) to join him on The Beijing Hour. You can listen to the full episode of the show from Sep 30, 2020 on the China Plus website and to the interview excerpt from the Listen section of this website. A full transcript of the excerpt is also available below.
Shane Bigham: What’s the significance of expanding China-Europe free trade and services to Nordic countries like Finland?
Ivo Ganchev: Trade relations between China and the Nordic countries have been growing considerably for over a decade now. We saw Iceland sign a free trade agreement with China in 2013, Norway has been very keen on expanding bilateral trade relations, Finland also works very well with China – and it’s great to see that this widened very inclusive rail network now links up the region with the Chinese market and offers new opportunities for economic growth to Northern Europe. The Nordic countries are actually highly innovative in terms of sectors such as green energy, and they have great natural resources as well. So, to capitalize on these advantages it’s essential to be as integrated in the global economy as possible, and this is what the rail network is offering. Now, more specifically in terms of the new trade route. After Helsinki it continues to a small Norwegian town called Narvik, which will have great potential to develop further as a major international transport hub. So overall, we can see that the opportunities are there, both at the macro economic level, and for local business communities as well.
Shane Bigham: How can rail cargo service fully realize its potential in upgrading China Europe, economic ties in the post pandemic era?
Ivo Ganchev: When it comes to trade and logistics the pandemic made us rethink the extent to which we rely on air and sea freight, and this naturally led to an increase in demand for train freight. Like any other service, when we talk about transport to the more demand there is, the easier it becomes to maintain low service prices and to increase operational efficiency, so this is exactly what happened with the China Europe railway network. From a business standpoint, China and Europe are natural trading partners because both happen to manufacture products that are in demand on the other side, and from the standpoint of political economy, maintaining balanced and steady trade relations is ultimately what China and the EU are aiming for. So rail cargo has the potential to serve as a basis for this, and finally something that I find even more exciting is perhaps the potential of this development to boost e commerce, offering fair reasonable delivery times and fees in both directions in the early stages it’s most likely that we’ll see this at the B2B level, but in the longer term I wouldn’t be surprised to see B2C developments, meaning that Chinese and European consumers could easily have items from one end of the world delivered to their local storage house, and then to their doorstep much faster and much cheaper than before.
Shane Bigham: That was Adjunct Professor Ivo Ganchev with Beijing Union University, talking about China Europe freight train services.