The State Council has approved a plan to support the country’s logistics industry. Experts have praised the plan, saying it will give a strong boost to the sector and be a key move in spurring domestic consumption.
China’s logistics industry lags some ways behind those from other parts of the world. According to the bailout plan, the logistics industry should develop in line with producers and trade companies.
Also, mergers and acquisitions should be accelerated in the industry. Mergers in the sector would help develop a group of large-scaled logistic companies who will be competitive on an international level.
CCTVInternational reported He Dengcai, Vice Secretary of China Federation of Logistics and Purchasing, ‘The bailout will improve the enterprises’ operational and managerial processes. It will help to enlarge the country’s logistics market, and speed up the industry’s development. Logistics has been in China for 30 years, and this is the first complete bailout to support the industry.’
Logistics is a multi-level industry that combines transportation, storage, information, and distribution. It involves a broad range of sectors and uses a great number of employees.
He Dengcai said ‘Logistics is a multiplex industry, since it covers many sectors. Nine of the ten bailouts all contain logistics. Meanwhile the government’s call to enlarge domestic needs will need to be achieved via logistics. China’s logistics industry is lagging behind, so hopefully the bailout will help reduce the costs. In terms of the country’s economic structure, logistics accounts for nearly 17 % of the service sector. So to speed up logistics will improve the proportion of the country’s service sector in economy.’
TrafficWorld said the tax rate for storage and delivery companies in China is also likely to be cut from the current level of 5% to about 3%, according to Chinese press reports.