China's new aviation logistics hub
China is one of many countries seeking to strengthen the security of its supply chain in the wake of severe disruptions caused by the Covid-19 pandemic. The country is improving its international express services and investing in a global aviation logistics hub as part of this move.
Shanghai-based YTO Express Group recently announced it will build an international aviation logistics hub with a total investment of 6.6 billion yuan (29 billion baht) in Jiaxing, Zhejiang province in eastern China. YTO Express is partnering with the local government to develop the hub which will benefit from Jiaxing's location, economy, infrastructure facilities and consumer market.
The project will not only contribute to the integration of the Yangtze River Delta region, but also enhance China's capabilities in air cargo in general. The hub is expected to raise the company's freight handling capacity to 2.4 million tonnes by 2050. On a larger scale, this hub will help cement the country's position as the global aviation logistics hub. According to an Aviation Industry Corporation of China report, China is expected to have 723 civilian cargo aircraft by 2038, up from 161 in 2018.
In addition, YTO Express plans to build a transport centre, a logistics technology research and development centre and a commercial hub in the region.
Meanwhile, Thailand is also expanding its capacity as a global aviation hub. The Eastern Special Development Zone Policy Committee of the Eastern Economic Corridor (EEC) Office recently signed a deal with U-tapao International Aviation Co to develop the "Aeropolis" in Ban Chang district of Rayong province.
The EEC Aeropolis envisions the area surrounding U-tapao International Airport becoming a giant aerospace-focused city with free trade incentives and well developed logistics, aerospace, commercial and industrial facilities. The project hopes to create 78,000 jobs in the aviation sector and related businesses in its first five years.
With this project, U-tapao will link with Don Mueang and Suvarnabhumi airports and increase the three airports' total handling capacity to up to 200 million passengers per year.
Plans for the U-tapao International Airport City Project and Eastern Airport City Project also include a high-speed train route linking the three major international airports, the contract for which was signed last October between a Charoen Pokphand Group-led consortium and the State Railway of Thailand.
Suwatchai Songwanich is an executive vice-president with Bangkok Bank. For more columns in this series please visit www.bangkokbank.com