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China-Spain train arrives full but leaves empty
By:
thinkSPAIN , Sunday, March 27, 2016

EXPORT bosses in China are trying to find ways of making the world's longest train pay for itself – the convoys are full to bursting with goods when reach their destination in Madrid, but return less than a quarter full.

The train, which has 39 carriages, covers the 13,000-kilometre (8,125-mile) trek from the city of Yiwu in the central Chinese province of Zhejiang to the Spanish capital in just three weeks, crossing through Kazakhstan, Russia, Belarus, Poland, Germany and France, then back by the same route – but with only around eight of its carriages full.

It was introduced in the year 2014 as a faster way of importing and exporting between Spain and China, but costs considerably more than shipping by sea.

The latter takes six weeks, even though it saves money.

Exporters in Spain are thought to be put off by the extra expense, since they only have to pay €1,300 for a shipping container on a ferry as opposed to €2,000 on the train.

Red tape is also a problem, since the exports have to comply with several national laws to cross through countries by land.

This is not a problem when Spanish goods are carted through EU countries, and few problems have been encountered in Belarus, but a long paper trail starts and lots of questions are asked when certain foodstuffs – particularly Spanish ham – reach Russia, according to Chinese export association leader Mao Wenjin.

This said, larger exporters from Spain say the train has been a godsend.

According to the Vivanco wine merchant's in Spain, which has shipped red wine to China on three occasions via the convoys, the extra costs are in fact an investment because they mean good are not held up at the port of Shanghai and customs duties are avoided.

Spain does not have much of a tradition of goods transport by rail, Vivanco says, but the convoys pick up a large quantity of goods in the rest of Europe – especially Germany – which brings down the costs for everyone along the line.

Another winery, Hermanos Rubio, has used the Yiwu Express twice for transporting red wine and, although it needed to factor in the extra cost of thermal blankets to protect its produce in winter whilst they passed through the freezing climates of Russia, this company agrees with Vivanco that the higher expenses are a great investment.

Every time an exporter uses the train to ship goods to China, it is given a free advertising slot on national TV, which is government-owned because of China being a communist country.

Some of the reason for the greater use of the carriages on their way to Spain rather than on the way back is the fact that China's manufacturing industry is cheap, huge and prolific, meaning it is able to churn out far more goods in a much shorter time and which are retailed at very low prices and normally fall into the 'boring but necessary' category where everyone needs them but do not want to have to spend any money on them – such as coat hangers, tupperware containers, and basic household and DIY-type goods in general.

Spain, by contrast, ships out olive oil, bottled water, wine and ham to China, although the Spanish trade secretary of State wants to encourage fruit and vegetable farmers to do likewise since cold storage is easier on a train and does not affect the quality of the produce.

And Spanish goods are still very much in demand in China, even though the huge Asian country's economy is not growing anywhere near as fast as it has in the last few years.

The rail terminal in Yiwu means the city has basically turned into a giant warehouse – over 10 million buyers visit it annually, the gross domestic product (GDP) for the metropolis alone is 8% of that of Portugal, and according to Wenjin, if a person were to visit one wholesale store every three minutes for a maximum of eight hours a day, it would take over a year before he or she had been to all of them.

 

Photograph by Spanish rail board ADIF

 

 

 
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