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Logistics need better handling
2001-04-02
China Daily
Senior officials attending a symposium in Beijing yesterday called for more government support to improve the quality and efficiency of China's logistics services.
"Policies on the logistics service industry at the macro level are unclear and this hinders the industry's rapid development," argued Wang Ming, director of the Institute of Comprehensive Transportation under the State Development Planning Commission.
Logistics services mainly consist of transportation, storage, packaging, portage, loading and unloading, processing and information transmission.
Wang spoke at the ongoing second China Logistics Management and Technology Symposium.
The two-day symposium, organized by the China Association of Warehouse and Storage, the Commercial Development Centre under the former State Administration of Internal Trade and the Logistics Technology Institution, kicked off in Beijing yesterday.
Both government and company officials have gradually come to realize that reducing logistics expenditures is a good means of increasing profits.
"But difficulties in improving logistics services are even larger than the potentials," Wang warned.
The official said there is a comprehensive problem afflicting China's logistics service industry.
China has established the basic infrastructure and equipment for logistics services, but management and operations are still lacking, he said.
By last year, China could boast 68,000 kilometres of railroad and 1.4 million kilometres of highway. The country also has 9,218 berths for shipping vessels, 145 civil-use airports, 14.5 million automobiles, 38.9 million tons of shipping power and 200 million square metres of storage area, according to official statistics.
But, despite these resources, China's logistics services have been characterized by inefficiency due to bad co-ordination between different sectors of the industry.
Official statistics indicate that for every 10,000 yuan (US$1,207.7) of China's gross domestic product (GDP), the country uses roughly 9,200 ton-kilometres in transportation, compared with 870 ton-kilometres in the United States and 700 ton-kilometres in Japan.
Spending on logistics makes up about 15 per cent of China's GDP, compared with 10 per cent in the US and 14 per cent in Japan.
Wang said logistics activities account for more than 90 per cent of the time it takes to get products on shelves and 20 per cent of the costs of commodities.
He said the government has come to attach greater importance to the industry but needs to clarify relevant policies and rules to guide, co-ordinate and promote the industry's development, nurture the market for logistics services, and step up research and development on logistics technologies.
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