China is funding trans-Eurasia trains in an effort to decouple from the US

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A freight train transporting containers laden with goods from London, arrives at Yiwu railway port station in Yiwu, east China’s Zhejiang Province on April 29, 2017. (STR/AFP via Getty Images)

According to government documents obtained exclusively by The Epoch Times from a reliable source, the Chinese regime paid subsidies to maintain and develop freight train operations connecting China with Central Asia and Europe. According to experts, this railway would allow China to strengthen ties with other countries in order to decouple from the United States.

“By using the freight train to export more products to Europe and Central Asia, the Chinese regime is preparing for a potential decoupling from the United States while also maintaining its fragile economic system,” Tang Jingyuan, a U.S.-based Chinese affairs commentator, told The Epoch Times on May 4.

According to official data, trade between the United States and China reached 4.06 trillion yuan (approximately $627.14 billion) in 2020, accounting for 12.6 percent of China’s total foreign trade.

According to a report by China’s Ministry of Commerce, the United States was the second largest importer of Chinese products in 2019, purchasing $418.5 billion in goods while running a $295.8 billion trade deficit. When the trade war began in 2018, trade between the US and China totaled $633.52 billion, accounting for 13.7 percent of China’s total foreign trade, and China enjoyed a $323.33 billion trade surplus, according to the Ministry.

Jin Canrong, one of Beijing’s top China-US relations experts, also stated that China is forming new business circles in anticipation of a possible decoupling from the US.

The Epoch Times obtained leaked documents that emphasised the significance of the Trans-Eurasia Logistics, a railway that connects China with Central Asia and Europe. The documents were issued by the northern Hebei provincial government, the city government of Baoding, and the city government of Changchun in China.

Trans-Eurasia Logistics, also known as the China Railway Express (CR Express), was launched in March 2011 and is an important component of the regime’s Belt and Road Initiative (BRI, also known as One Belt, One Road). It ships goods from over 40 Chinese cities to approximately 90 cities in over 20 countries, including Germany, the United Kingdom, Spain, France, and Italy, providing a significant trade benefit to Beijing.

“From June 2020 to the present, over 1000 trains have transported freight goods in BRI regions.” The CR Express is a fantastic tool for stabilising China’s foreign trade, “the Chinese State Council (cabinet-level) stated on its website on April 20.

According to the exclusive documents, the Chinese government subsidised the establishment of this prosperous railway transport.

On March 5, the Hebei provincial government issued an internal document outlining the ten most important tasks in the province. One of the tasks was foreign trade, and the CR Express was an important tool.

“[Each government] should conduct research and develop policies to provide subsidies to international freight trains.” “[We must] maintain stable train service to Central Asia and Europe, develop more trains to other cities in the Association of Southeast Asian Nations [ASEAN], and maintain transportation channels for foreign trade,” according to the document.

A number of government documents from Hebei’s Baoding city mentioned the CR Express. The trains would be used by Baoding to sell products to Belarus, Lithuania, and Russia.

According to a document issued by Baoding authorities on June 29, 2017, the trains would assist the city in exporting 250,000 metric tonnes of goods worth $2 billion to Belarus and 150,000 metric tonnes of goods worth $1.2 billion to Lithuania each year.

According to the document, the train assisted the city in developing its BRI projects, which include a hospital in Lithuania and industrial parks in Minsk, Belarus, and Saint Petersburg, Russia.

“The China-Belarus Industrial Park covers 91.5 square kilometres [35.33 square miles], which is one-third the total area of Minsk… It is China’s largest industrial park outside of China, with the best investment policies. “This is the largest cooperation investment between China and Belarus, as well as a key project of the BRI,” according to the document.

According to its website, the park’s official name is Great Stone, and the Chinese enterprises that have factories in the park sell their products to countries in the Commonwealth of Independent States (CIS) or the former Soviet Union.

In the same document, the Baoding government explained that the Chinese regime intends to export materials to Minsk and assemble products there, reducing costs and increasing profits.

According to a document issued by authorities in Changchun, the capital city of northeastern Jilin Province, the majority of the CR Express trains are operated by state-run companies and rely on state subsidies because “it’s a common issue that [transportation agents] can’t collect enough orders to ship goods from Europe back to China.”

Chinese state-owned enterprises According to the China Business Journal on July 27, 2019, China Railway requires each freight train to have 41 containers, and the majority of CR Express trains are not fully loaded. “Approximately 20% of the containers on the outbound trains are empty,” according to Urumqi Railway Bureau staff quoted in the report.

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A freight train transporting containers laden with goods from the UK, departs from DP World London Gateway’s rail freight depot in Corringham, east of London, on April 10, 2017. (ISABEL INFANTES/AFP via Getty Images)

More empty containers have been discovered on the inbound trains. “Sometimes, only one of the 41 containers [of an inbound train] contains goods,” said a staff member from China Railway’s headquarters in Beijing, according to the report.

On December 20, 2020, The Next Federation, a Chinese summit organiser and partner of state-run media Xinhua and China Economy, published an article in which it stated: “The local city government pays around $3,000 per container per trip for all CR Express trains.”

According to the report, many cities in Europe and Central Asia had to figure out how to deal with the empty containers because they couldn’t collect any goods, and the cost of shipping the empty containers back to China was more expensive than making a new container.

According to the report, some city governments pay 1 billion yuan (approximately $154.47 million) per year in subsidies, while others pay 1 million yuan (approximately $154,470) per train in subsidies because shipping revenue is insufficient to cover the costs.

According to the report, the CR Express is a Chinese regime ploy to undermine the United States’ maritime hegemony, because the regime believes that creating a competitive transportation channel can change the global supply chain.

According to official data, the transportation cost of a CR Express trip is 25% of the cost of a flight trip, and the duration of a CR Express trip is approximately 33% of a trip by sea. According to several global transportation services websites, the CR Express takes three times as long as a plane to ship a container and costs twice as much as a ship.

In a video posted on YouTube on June 22, 2020, Jin Canrong, a professor and associate dean of the School of International Studies at Beijing’s Renmin University of China, discussed the potential decoupling of the United States and China.

According to Jin, US-China relations are deteriorating.

“The United States may decouple from us in the economy, technology, and education,” Jin predicted. “I believe that, following the pandemic, the United States and China will become more strategically hostile. At that point, the US will decouple from China. ”

Jin then discussed solutions, such as “establishing business circles outside of the United States,” such as doing business with countries in “Southeast Asia and Northeast Asia.”

Tang Jingyuan, a Chinese expert, reviewed the government documents and stated, “It’s clear that the Chinese regime wants to use this railway project to build a new trade channel with Europe and Central Asia.” Simultaneously, the project opens the door for Beijing to establish closer economic ties with these regions. ”

Tang believes that by analysing the motivation behind the railway, China is preparing for a potential decoupling from the United States and achieving its goal of becoming the world’s largest economy.

“The Chinese regime eagerly joins forces with Europe, believing that the combined force will be stronger than the United States in economic terms. The Beijing authorities will then find a way to get rid of Europe and become the dominant force, “Tang added.

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