Trade between China and Europe remained robust in the first eight months of this year despite the Covid-19 pandemic and growing tensions, as the number of China-Europe cargo train trips exceeded 10,000 at the end of August – two months earlier than last year. This showed the efficiency of this new transport mode and the massive shared trade interests by the two sides, but the EU's increasingly hostile actions against China pose further risks to bilateral ties, Chinese analysts noted. As of the end of August, China-Europe trains had made 10,030 journeys, up 32% year-on-year, according to a statement by the China State Railway Group Co (China Railway). During those trips, 964,000 TEU of containers were transported, up 40% on a yearly basis. More than 1,000 trips have been made every month since May 2020.
Liu Ying, Research Fellow at the Chongyang Institute for Financial Studies at Renmin University of China in Beijing, emphasized that the China-Europe trains have become crucial life-saving routes during the pandemic, not just for Europe but the world at large. China-Europe trains have carried 12.8 million items and 99,000 tons of epidemic prevention materials to European countries since the outbreak of the epidemic. “A growing number of containers that were formerly delivered by sea are now being diverted to the freight trains due to global shipping disruption, causing occasional congestion on the trains and making it hard to book space,” Xu Yuanyuan, Manager of Shaanxi Further Strategy Supply Chain Management Co, told the Global Times.
Cui Hongjian, Director of the Department of European Studies at the China Institute of International Studies, pointed out that China and Europe rely heavily on each other in trade, especially in traditional areas, despite the current tension, which can be seen in the highly efficient movements of the China-Europe trains. So far, the cargo trains have reached more than 170 cities in 23 European countries and transporting more than 50,000 types of goods, providing transport support for the economic and social development of regions and countries under the Belt and Road Initiative (BRI). This year marks the 10th anniversary of the departure of the first China-Europe freight train, which traveled from Chongqing to Duisburg, Germany.
However, the EU's increasingly hostile approach toward China may pose further risks to bilateral cooperation, analysts said. The European Parliament passed a motion to freeze discussions on the EU-China Comprehensive Agreement on Investment (CAI) in May after its sanctions against China prompted counter sanctions. China-EU ties took a further hit as Lithuania and China recalled their ambassadors after Lithuania upgraded the status of Taiwan's office. Asked about a proposed bill in the EU that will result in the exclusion of Chinese companies from procurement contracts, China's Ministry of Commerce Spokesperson Shu Jueting urged the EU to uphold fair and open market principles, and to avoid protectionism and discrimination.
China's investment in Europe declined 45% to €6.5 billion, according to a report by the Rhodium Group in June. From January to July 2021, total trade between China and the EU reached USD457.42 billion, up 33.9% year-on-year, according to the General Administration of Customs, the Global Times reports.
