Head of the Czech Logistics Association: Dependence on China can't be solved in a hurry

Head of the Czech Logistics Association: Dependence on China can't be solved in a hurry
© Lenka Pribanova Photography

In the context of the new investment of the Chinese company COSCO in the Port of Hamburg, RAILMARKET.com NEWS interviewed Petr Rožek, Managing Director of the Association of Forwarding & Logistics of the Czech Republic. At the recently concluded Transport & Logistic trade fair in Munich, we've been interested in his views on future logistics relations between Europe and China.

RM: What is China's current position in global trade and logistics?

According to the latest UNCTAD ranking of logistics capabilities, although China does not occupy one of the top positions (Singapore, Finland and Germany are there), China's role as a trading power is of course reflected in the scope and structure of the country's logistics services. The current government is investing heavily in infrastructure development. More than 5 of the world's top 10 ports are in China; the world's longest freight rail link begins (and ends) in China; only in air (freight) transport has China returned to the norm after the covidi boom subsided. On the other hand, China benefits from the presence of subsidiaries of the world's largest logistics companies in the country and from their know-how.

RM: There is a lot of discussion now about the dependence of the West (including the US) on China for such basic things as the substances needed to make medicines. But these are not the only commodities where we are dependent on China, can we ever break this dependence?

Over-dependence on anything is of course an unpleasant thing, and as such it needs to be treated and broken. But it cannot be done too quickly and too adventurously, as seems to be happening in Europe at the moment; after such a hasty action, withdrawal symptoms will set in and the patient may collapse from this quickly acquired independence. However, I find the political statements made by senior EU officials to be somewhat 'tailored' and 'fashionable', stemming from the need to find an external enemy to blame for internal misbehaviour. For more than 40 years, Europe has been living off cheap manufacturing in China, and the scale of investment by European companies in China is now such that it is impossible to rely on European companies moving 'elsewhere' in the near future. And then there is the "Neruda" question (editor's note: Jan Neruda was a famous Czech writer): where to move, where the Chinese are not already hooked in some roundabout way?

RM: What is the current position of the Czech Republic in relation to China? A few years ago there was talk of investments that didn't materialise. Where is the Czech Republic today and how important is China for the Czech Republic?

As many recent examples around the so-called Silk Road in the Third World show, China is focusing its investments more on emerging markets, whether in Southeast Asia or in Africa. That is why it was already clear at the time of our former president's courtship of the Chinese leadership that billions of dollars of investment would not be flowing into the Czech environment. This means that the Czech Republic has nothing to offer China in return for repaying any loans, which is usually the case with such "investments". Even geopolitically, the Czech Republic is not a strategic partner for China; Germany (a major investor in China) and other large EU countries are, logically. But China is a crucial partner for us as a supplier of many finished products and parts without which our manufacturing economy could not exist. If alternative sources of these products can be found in the future, we can certainly cut ourselves off from Chinese imports, but it is certain that the government's doctrine of suppressing contacts with China will only encourage alternative traders who will be happy to supply the Czech market with Chinese production in a roundabout way and at an attractive margin. As has long been known, goods will always find their way; artificial barriers will not stop them, they will only make them more expensive.

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