China-Europe freight trains shoring up economic lifeline amid COVID headwinds

BERLIN－Though the outbreak of COVID-19 had grounded Europeans for months and impacted the economy as a whole, some sectors such as the electronics business have spotted a niche given the surging demand for laptops and other gadgets at home.

Lu Hong, a local brand director of laptop manufacturer ASUS in Southwest China's Chongqing municipality, found such a niche and witnessed a boom in business in 2020.

But a shortage of sea freighters, price increases and unpredictable shipping times pushed him to the brink of breaking contracts.

A silver lining was brought about by China-Europe freight trains which bolstered fragile supply chains in Eurasian countries and saved businesses in both China and Europe.

Solution to supply disruption

Lu's company last year hired some 1,000 containers to deliver computers through China-Europe freight train services across the Eurasian continent.

Though its prices are a little higher than seaborne shipping, the train service provided by China Railway Express (CRE) has the advantage of a relatively stable schedule. It takes as short as 12 days to get to Europe from China depending on specific departure times and destinations.

"Due to the pandemic containment measures, there are many disruptions of sea transportation. Now it's very hard to get enough containers and prices are skyrocketing," Lu said.

The past year was tough for many business operators like Lu, since volatile air and ocean freight capacities resulted in soaring shipping prices.

Similarly, Chinese car manufacturer Changan Ford Automobile also turned to trains to tackle supply problems caused by the pandemic. Upon the outbreak of COVID-19, Changan's assembly line was nearly suspended due to the delays and disruption in shipping auto supplies from Spain.

The company urgently rerouted the transportation of supplies with cargo trains passing by Germany's Duisburg, which took some 20 days to reach Chongqing, said Zhuang Changbo, logistics supervisor at Changan Ford Automobile. "It saved some 50 days compared to sea transportation".

Anti-pandemic 'Green Passage'

Traffic via the CRE surged 75 percent year-on-year to 3,398 trains in January-March, after topping the annual record in 2020 with 12,406 trains, China State Railway Group said.

Besides auto parts, clothes, toys and electronics, some airmail from China to Europe was also diverted to CRE trains departing from Chinese cities including Chongqing, Yiwu and Guangzhou.

Notably, life-saving medical supplies and raw materials were also transported to Europe by freight trains, when countries along the route were synergizing their efforts to combat the coronavirus.

Official data showed around 94,000 metric tons of anti-pandemic supplies were sent through the route, with special trains carrying surgical masks, medical gloves, water-soluble bags, contactless gel dispensers and other supplies to Poland's Malaszewicze, Germany's Duisburg, Madrid in Spain, and Paris in France.

Volker Tschapke, honorary president of Germany's Prussian Society, called the train route an anti-pandemic "Green Passage," saying that "Europe was rather desperately encountering the first wave of COVID if you remember. (Medical) shortages were seen everywhere. The train routes were vital and they saved lives."

Paving way for future

According to official data released on Sunday, the China-Europe freight-train service has recorded more than 40,000 trips. The transported goods were valued at over $200 billion.

Since the first China-Europe freight train departed from Chongqing in March 2011, the service has reached more than 160 cities in 22 European countries.

Countries along the international freight route have shown growing interest in cooperation on upgrading logistics chains to speed up post-pandemic recovery.

Finnish Minister for Development Cooperation and Foreign Trade Ville Skinnari said that railway freight, which features much lower carbon emissions, has a clear sustainability advantage compared to other means of transport.

"For the companies, it is important to be able to diversify their logistical chains, add value with speed and have alternative means of transport. Especially since the COVID-19 pandemic, the logistical chain risk is definitely something that many companies are more aware of," Skinnari said.

In early June, a subsidiary of Polish State Railways (PKP), started a program connecting Wroclaw, a major city in southwestern Poland, via Malaszewicze, the gateway of railway connection in Poland and Europe, with several Chinese cities including Chongqing. It is a bid by PKP to extend its transport connections.

Ivan Ruzbacky, president of PKP Cargo Connect, said the new connection between Wroclaw and Chinese cities is a step to enhance connectivity under the Belt and Road Initiative.

The project offers "a unique opportunity to fit into global supply chains," he said. "This in turn translates into a positive perception by international customers and related development and expansion opportunities."