The silk railroad of China-Europe trade

silk road

Multinationals operating in China have been setting up factories deep in the interior in search of affordable labor. These plants can be more than a thousand kilometers (621 miles) from the coast. For companies exporting to Europe—still one of the largest markets for Chinese goods—shipping by air from Chongqing or other inland cities is too expensive. Trucking or carrying goods by train to the ports of Shanghai or Shenzhen’s Yantian and then shipping them to Western Europe can take 40 days.

There’s an alternative; an “international freight-train network” linking China to Europe. It starts in Chongqing and traverses Kazakhstan, Russia, Belarus, and Poland before reaching Duisburg, Germany. A separate line from China’s northeast links up with the Trans-Siberian Railway, which runs 9,288 km from Vladivostok to Moscow.

Shipping one container by train costs about $10,000, one-third the price of air transit. Although the train is about twice the cost of shipping by sea, it takes only 21 days for products from a factory in Chongqing to reach Western Europe by rail. The carbon footprint of rail, meanwhile, is about one-thirtieth that of airfreight.

The Chinese are enthusiastic about the rail connections to Europe. The government is considering financing track construction in its Central Asian neighbors of Uzbekistan and Kyrgyzstan. Premier Wen Jiabao has referred to the China-Europe rail link as part of a new Silk Road, the land route that connected western China to the eastern Mediterranean for more than a millennium.

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About thomasdinnocenzi

Thomas D'Innocenzi is a highly accomplished, results-focused senior international executive with extensive experience in global sourcing and market development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global sourcing operations worldwide. Extensive experience in international market development operations to accommodate rapid growth. Skilled in building top-performing teams, benchmarking performance, and restricting organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. As principal of Nova Advisors, LLC I’ve assembled an exemplary team that brings with them the knowledge and experience gained from starting up a Global Sourcing program with multiple Fortune 500 companies as well as the largest supplier network throughout the Asia-Pacific region. We have experience and expertise in more than a thousand medical and pharmaceutical products in manufacturing and sourcing at the best value. The right product, the right price point and the right branding fueled these successes that resulted in double-digit growth for top line sales and bottom line net margins for our customers. What sets us apart: • Our reach includes a large network of suppliers & manufacturers spanning 13 countries in Asia-Pacific region • We understand the manufacturing process and the business of the supplier and the buyer • Our company culture is based on quality assurance and our process is based on local quality control Our commitment is to be your partner offering the best products and services at the lowest cost. Contact me to discuss how we can make the global marketplace work for you. thomas@novaadvisors.com In addition, I am open to discussing opportunities in global sourcing, international marketing & sales, logistics and medical/pharma in Thailand, Vietnam, Malaysia, Philippines & Japan. Aside from my work I enjoy piano, astronomy, physics, and assisting my daughters with their studies. SPECIALTIES: Global Sourcing, Supply Chain Management, Business Development, Marketing, Logistics, Global Networking, Market Development, Healthcare Solutions, Pharmaceuticals, Medical Devices, Technology, Asia, Southeast Asia, US and Canada
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