PJCS TransContainer, Russia's biggest container operator, has announced a plan to expand its China business in response to the soaring cargo transit demand between China and Europe under the Belt and Road Initiative.
The TransContainer Freight Forwarding (Shanghai) Co Ltd, a wholly owned subsidiary established on Tuesday at the China (Shanghai) Pilot Free Trade Zone, will serve as the Russian company's headquarters in China, and focus on port transportation.
The Beijing-based Chinese-Russian Rail-Container International Freight Forwarding Co Ltd, a joint venture set up by TransContainer and China Railway International Multimodal Transport (CRIMT) in 2010, is tasked with handling railway transportation, according to Petr Baskakov, CEO of PJCS TransContainer.
"The Shanghai company can enjoy favorable policies, including taxation of the free trade zone, (and) has three tasks, which are maintenance of the containers, processing of logistics orders, as well as marketing and promoting the company to global market including China," Baskakov told China Daily.
An affiliated company to the TransContainer Shanghai will be established in South China in 2018, and another two will be established in Qingdao of Shandong province and Chengdu of Sichuan province in 2019, the CEO added.
The Port of Shanghai handled 37.13 million TEU (20-foot equivalent unit) containers in 2016, taking the lead among global container ports for seven consecutive years.
China contributes about 30 percent of TransContainer's global transportation volume and revenue for the moment, up from 15 percent of 2010, the largest contributor after Russia.
"Cargo transition volume has surged tremendously between China and Europe, as well as between China and Russia, thanks to the Belt and Road Initiative," Baskakov said.
Against a global economic slowdown, bilateral trade volume between China and countries and regions related to the initiative reached 6.3 trillion yuan ($955.5 billion) in 2016, up 0.6 percent year-on-year, Song Lihong, an official from Ministry of Commerce, was quoted as saying by China News Service.
The decision to set up the Shanghai subsidiary was made by the company's board of directors in February this year, in an attempt to consolidate TransContainer's positions in intermodal transportation between Russia and China, including via sea routes.
"TransContainer hoped ... the Shanghai subsidiary (would) enhance service quality and broaden service field of multi-modal container transportation between China and Russia," Baskakov added.