Qinzhou banks on new Maritime Silk Road

Local leaders say State support crucial for the concept's success

When President Xi Jinping proposed the "Maritime Silk Road of the 21st Century" during a state visit to Indonesia last year, most officials in Qinzhou, in the Guangxi Zhuang autonomous region, had no idea what Xi's proposal would mean for the port city, which was the starting point of the ancient Maritime Silk Road thousands of years ago.

One thing they did recognize was that Xi's proposal would bring new opportunities for Qinzhou to secure greater support from the central government.

Qinzhou is a major conduit to Southeast Asia, with a national-level bonded port area and a Malaysian industrial park.

Pei Yun, deputy director of the port administration bureau, said so far, he has not received any notes from the city government about the new initiative.

"The central government should step up its funding and policy support for Qinzhou port if it really wants to boost connectivity with Southeast Asia," he said.

Most local officials and residents would agree. Huang Lihe, an official from Qinzhou's development and reform commission, said the commission is busy drafting applications to the central government regarding what Qinzhou would bring to the Maritime Silk Road, as well as what help it would need to get the job done.

"Improving the port is the main priority for Qinzhou," Huang said. "Opening new lines connecting with the 47 major ports in Southeast Asia and building a maritime search-and-rescue system in the region are beyond the capacity of Qinzhou," he added.

Up until a few years ago, the port could not handle more than 1 million tons. But when China began deepening its integration into the Association of Southeast Asian Nations, the port's handling capacity swelled to 60 million tons and 600,000 standard containers last year.

With several 100,000-ton shipping lanes, Qinzhou port looks forward to building more 300,000-ton shipping lanes and 300,000-ton berths, allowing more bigger ships to dock.

"But the money is still a problem," said Xu Wanjie, head of the planning section of Qinzhou port economic and tech development zone administration. "It takes about two years for us to get the funds to build a new port or shipping lane. Local governments are more sensitive to market changes, but the higher authorities' slow response delays the process."

Xu said the government's working style had not changed as much as State leaders expected it to. "The higher authorities remain adamant in concentrating power in their hands, leaving the grassroots departments no choice but to apply for approvals," he said.

During a visit to the city last year, Premier Li Keqiang said Qinzhou port should be handling at least 10 million standard containers a year. Li pointed out that the vast hinterland of Yunnan, Guizhou and Sichuan provinces provides Qinzhou port with huge growth potential.

But local officials are realistic in discussing such an ambitious target.

"Without extra help, how can a 3-year-old catch up with the adult?" asked Xie Zhujun, deputy director of the Qinzhou port office. "I hope the central government can approve Qinzhou's application of building a free-trade zone, which means more preferential policies and financial support."

Qinzhou residents donated money to build the port after border conflicts between China and Vietnam ended in the late 1980s.

The distance from southeastern China to Qinzhou port is at least 500 kilometers shorter than the road to Guangzhou. But lagging infrastructure and competition from neighboring Fangchenggang port and Beihai port have offset Qinzhou's geographical advantage.

Qinzhou port's four overseas lines - to Hong Kong, Singapore, Kaohsiung in Taiwan and Haiphong in Vietnam - all opened within the past three years. A new line to Kuantan in Malaysia will open this year.

Although the Qinzhou government has tried its best to promote the port to the enterprises and governments in the hinterlands, it has not seen a rise in clients from there.

"Were it not for the powerful State-owned enterprises, it would be almost impossible for Qinzhou port to see continuous growth of its handling capacity when China's trade declines," Pei said.

With cheap land and low taxes and labor costs, Qinzhou has attracted several large State-owned petroleum enterprises, along with petrochemical industries, thermal power and papermaking enterprises from Indonesia to its port area in the past decade.

These giant enterprises' self-operated ports make up most of Qinzhou port's annual handling capacity.

When a petroleum chemical factory temporarily suspended production last year, Qinzhou's economy dropped by nearly 30 percent.

Attracting these big enterprises to Qinzhou, was a major accomplishment for local officials who are now seeking concrete benefits for Qinzhou's economy from the Maritime Silk Road strategy.