Nov-04
China's air cargo industry takes off

More than 2.2 million tonnes of air cargo and mail was handled in China in 2003, up 8.4% over 2002. About 23% of the volume went on international routes, a 21% increase over 2002. Growth in overall air cargo is expected to increase to 20% during 2004.

Looking forward to 2010, air cargo in China is forecast to rise by at least 10% a year, to 5.1 million tonnes. As manufacturing costs increase and time constraints are imposed to keep inventories low, air will increasingly be the preferred cargo mode for time-sensitive goods like electronics and medical products, particularly in the high-tech Pearl River Delta region.

The Chinese government has given its air cargo industry a much needed shot in the arm by relaxing restrictions and setting up agreements with major trade partners. Approval procedures for local airlines to import cargo aircraft have been simplified and approval of air cargo routes and flights reformed.

Foreign cargo operators are preparing for direct access to the mainland. Early movers include Polar Air Cargo, Federal Express and Lufthansa Cargo, who are already establishing cargo bases and services. China's leading air cargo players will take at least five years to develop expertise and networks similar to Hong Kong's, and during this infancy stage the market will offer exceptional dynamism and growth opportunities.

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