In China'S Shipping Market, 90% Of The Goods Are Shipped By Foreign Ships, And Foreign Carriers Play The Leading Role.

As a big country of import and export, why does the deficit in transport services continue to grow?

Transport capacity development is not up to the growth of trade volume, and the related maritime services are mainly provided by overseas maritime enterprises.

With China's entry into the World Trade Organization (WTO), China's trade in goods has increased rapidly in the past 18 years. According to statistics, in 2018, China's total import and export volume amounted to 4 trillion and 620 billion US dollars, accounting for 11.75% of the total trade volume of the world, accounting for 11.75% of the total trade volume.

However, as a large shipbuilding country and a large importer and exporter of goods, although the total volume of China's import and export freight is completed by sea, the transport trade under service trade presents a continuous deficit of 90%.

In 2018, the trade deficit of the balance of payments amounted to US $291 billion 300 million, of which transportation was the sub item of trade in services, with a deficit of US $66 billion 900 million.

The first financial reporter has learned that the development of transport capacity can not keep up with the growth of volume of trade, and other factors such as the provision of related maritime services, mainly by overseas shipping companies, all constitute the reasons for the unfavorable balance of transport services.

Capacity development can not keep up with volume growth

In China's shipping service market, foreign carriers play the leading role. According to the analysis and calculation of the number of ships on the Chinese docks, the proportion of Chinese ships owned by Chinese carriers may be less than 1/10, and 90% of the goods are shipped by foreign ships. Zhao Yifei, associate professor of economics and management at Antai University, Shanghai Jiao Tong University, said.

This situation will inevitably lead to a faster growth trend in China's transport services expenditure, from the deficit in 2001 to US $6 billion 700 million in 2018 to US $66 billion 900 million.

"There is a big gap between China's maritime transport capacity and transport demand of international goods trade." Zhao Yifei told reporters.

Due to the late start of China's shipping industry, there are only 1 Chinese enterprises in the first 10 enterprises of the global transport capacity, COSCO Shipping Cmi Holdings Ltd (hereinafter referred to as "COSCO sea control") and COSCO Hai Kong as the listed company of China Ocean Shipping Group Co., Ltd.

Due to insufficient capacity, the cost of shipping charges paid to overseas suppliers by China's shipping enterprises has further increased the cost of China's marine freight. Insiders told reporters that charter fees and port usage fees were more than half of the total cost of shipping services.

According to Alphaliner, a shipping consultancy, 312 ships were shipped by COSCO ocean shipping in 2018, paying about 1 billion 500 million dollars to overseas ships and paying about 5 billion dollars to overseas ports.

COSCO Hai told reporters that as of September 30, 2019, there were 502 vessels, including 164 vessels and 338 vessels.

Many experts believe that supporting the construction of modern shipping fleet and enhancing the international service level and competitiveness of China's shipping enterprises are one of the ways to improve our maritime transport deficit.

　　 Jin Hai, member of the board of experts of Shanghai International Shipping Research Center, believes that it is very necessary to deepen the shipping industry upgrading and enhance the competitiveness of China's maritime trade in services. Zhao Yifei said that if we want to change the situation of China's shipping service deficit, the method is to expand the scale and capacity of China's shipping fleet, that is, to invest and expand the fleet. But he also pointed out that whether the new shipbuilding or the purchase or leasing of second-hand ships, the huge capital needed is not necessarily a good practice.

Shipping services are provided by overseas shipping companies.

China's import and export trade related shipping services are mainly provided by overseas maritime enterprises, which is another reason for the unfavorable balance of transport services in China.

At present, about 80% of China's imports and exports are transported by overseas counterparties. In China's import trade, it mainly adopts C&F (Cost and Freight, cost plus freight) or CIF (Cost Insurance and Freight, cost plus insurance and freight) (hereinafter referred to as "C group terms"), which is paid by foreign export enterprises and is responsible for transportation. In China's export trade, the main purpose is to adopt the offshore price method (FOB) (hereinafter referred to as "group terms"), which is paid by foreign importing enterprises and is responsible for transportation. Offshore enterprises often choose overseas shipping companies to take charge of transport links.

The import and export trade of Midea Group is mainly export. In the export trade, F group terms are mainly used, accounting for about 85%, and 15% will choose C group terms. From the scale of foreign importers, most of the F group terms are larger importers, such as WAL-MART and so on. Most of the terms of choosing C group are small and medium-sized enterprises. Beauty group international logistics related person in charge told reporters. The person in charge believed that for the exporters, the terms of the C group had more power to speak.

"Foreign shipping and forwarding companies have developed very early, and the supporting services such as local terminals and transportation are very mature. For foreign buyers, they also involve the whole chain service after goods arrive. This is also a reason why most foreign buyers will cooperate with Chinese domestic exporters in choosing F terms." The person in charge said.

Comparatively speaking, SMEs in China feel more intuitively about the terms of group C and the terms of group F. Because of the issue of trade dominance, China's small and medium-sized import and export enterprises are more inclined to make foreign parties responsible for transportation in trade negotiations. Therefore, most small and medium enterprises will choose F terms in export.

Taizhou City Jiu Yi sanitary ware is a small and medium-sized enterprise mainly focusing on export tap products. Ye Shengyue, general manager of the company, told reporters that in the export trade of the company, F group terms were mainly used, and the overseas importing enterprises paid the freight and were responsible for the transportation. He said that lack of initiative in the course of trade did bring some inconvenience to the company. "The initiative is not on our side. Foreign customers prefer to use the designated freight forwarders and shipping companies, although to a certain extent, they avoid the fluctuation of shipping prices and transport costs, but the disadvantage is that they are not so flexible in operation, and the cost of communication services is higher and more troublesome."

See the whole picture. According to the customs data in 2018, the import direction of China is 88% of the total value of imports in terms of the CIF terms (C terms). The export direction is 78% of the export price in terms of off shore price terms (group F terms).

Zhao Yifei said that in the 70 and 80s of last century, the price terms of China's goods import contracts were mainly F group terms, and the terms of export contract terms were mainly C group terms. At that time, foreign shipping companies had not formed chain and segmented management in logistics services, and there were more inconveniences in goods collection. At present, the opposite is true. Most of the Chinese enterprises' export contracts adopt the terms of group F. Most of the import contracts are based on C group terms, and the problems are in terms of services.

"This is because the service of our shipping companies has not kept up, and there has not been a complete chain of services. The whole world is managed by supply chain, and we are piecewise managed. Zhao Yifei said that from the point of view of logistics, China's import and export enterprises and shipping enterprises have not yet established a perfect mutual coordination mechanism. The latter part of the service problem can not be well connected. From the trade point of view, China's export direction is mostly small and medium enterprises, and foreign enterprise buyers are more regulated, and have signed long-term service agreements with shipping companies, and the price has more advantages.

Development of transport services is a long way to go

On the one hand, the revenue from sea freight is limited, while the expenditure is constantly increasing. The double factors are stacked up, and the continuous deficit of transport service income and expenditure continues.

From the point of view of revenue, the direction of China's seaborne service export is basically full, but the empty import rate of imports is as high as 70%, and the income from ocean freight is limited. For example, COSCO sea control told reporters that the company's export routes were basically full of warehouses, the import direction, the European line 60% empty warehouse rate, the US line was 40% empty warehouse rate.

From the expenditure side, Guan Tao, a doctoral supervisor of Wuhan University and director of the balance of Payments Division of the State Administration of foreign exchange, pointed out in the 2018 China physical examination report on trade in services: no worries or worries. According to the statistics of the balance of payments, premiums and freight rates all belong to the service trade. The premium is usually calculated at 1% of the import volume and the freight rate is calculated at 4% of the import amount, which calculates the expenses of international insurance and transportation expenses. Only in this way, in 2018, the freight cost of the international balance of payments increased by about 11 billion 800 million US dollars, which is equivalent to nearly 80% of the increase in current freight expenses of US $14 billion 700 million.

The reporter has learned that the giant shipping companies in the world have set up an agent company in China. The acting subsidiary represents the overseas parent company to accept the customer's booking space and collect the sea freight for them. After deducting the cost of port usage and other domestic costs in China, the collection fee is remitted to the overseas parent company. Foreign shipping companies such as Ma Shiji, Da Fei ship and marine Internet Federation have adopted this mode to form China's shipping expenditure.

"To become a maritime power, China must first become a strong Chinese shipping enterprise. The best path is to deepen reform. We should take an active part in building a new international channel to enhance the whole supply chain service of "one belt and one road" and promote the industry to move towards the high end of the value chain. Xu Lirong, chairman of COSCO sea control, said so.

Zhao Yifei suggested that enhancing the logistics management ability of China's import and export enterprises is very important to grasp the choice of shipping companies in the import and export trade.

"The potential impact of the continued expansion of the trade deficit needs to be prepared for a rainy day." Guan Tao said, for example, to accelerate the structural adjustment and transformation and upgrading of the Chinese economy, we should vigorously develop the domestic service industry, enhance the international competitiveness of the service industry, reduce excessive dependence on the import of services, and enhance the ability of the service industry to earn foreign exchange through exports. For example, through the development of domestic education, medical treatment and shipping industry, we should reduce overseas study, medical treatment and international freight expenditures; improve domestic tourism market environment, improve visa clearance facilities, promote entry travel and increase international tourism revenue.