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Air cargo industry takes flight

By Lu Haoting (China Daily)
Updated: 2006-07-11 09:01

China's air cargo industry has never been so busy.

One can easily reel off a dizzying list of cargo start-ups in the pipeline.
Jade Cargo, a joint venture between Shenzhen Airlines and Lufthansa Cargo, will take off next month.

Shanghai Airlines Cargo, in which the subsidiaries of Taiwan's Evergreen Group hold a 45 per cent stake, was established last month and will launch cargo flights between Shanghai and Frankfurt in October.

China Southern Airlines, one of the mainland's three largest aviation groups, is looking for a foreign partner to establish a cargo joint venture.

And don't forget Great Wall Airlines, in which Singapore Airlines Cargo has a 25 per cent stake, that just launched its maiden flight in June. Yangtze River Express, the cargo unit of Hainan Airlines, has attracted investment from Taiwan's largest carrier China Airlines.

With an annual growth rate of 17 per cent in the past decade, China is one of the world's fastest growing air cargo markets.  So it is not surprising to see it become the leading focus for the world's air cargo industry.

And with the Chinese Government giving priority to the development of the air cargo industry, the market will continue to see dazzling growth in the future.

But in the short term, the country's trade imbalance is putting pressure on the economics of freighter operations in the country. Some people are even worried about early signs of short-term overcapacity in the market.

The General Administration of Civil Aviation of China (CAAC), the nation's aviation industry watchdog, said in March that the government would adopt "effective policies" to speed up the development of air cargo transportation in the 11th Five-Year Plan period (2006-10).

"Air cargo transportation is a new growth point in the Chinese civil aviation industry," said Sha Hongjiang, deputy director of the CAAC's department of planning, development and finance.