China to further open express delivery to foreign enterprises
September 30, 2014 Category Express delivery, Logistics
China will further open the domestic express delivery market to qualified foreign enterprises. The country will streamline license approval procedures and encourage mergers and acquisitions (M&As), even those launched with foreign capital, within the necessary review system. China’s international delivery business has become basically open to overseas capital, while domestic markets in major cities have gradually become available to foreign players. The enhanced competition will be an incentive for domestic companies to improve their operations and services, stimulate domestic demand and create more jobs, a government announcement said. United Parcel Service (UPS) has received licenses to operate express services in 33 Chinese cities, and 19 of these were granted this year. Apart from the two major hubs in Shanghai and Shenzhen, UPS also has about 250 operating facilities throughout China. FedEx said that it has been working closely with the relevant authorities to obtain express delivery service permits ever since the new Postal Law came into effect. According to a report released by Deloitte Touche Tohmatsu and the Development and Research Center of the State Post Bureau, 78.9% of market share is held by private companies, 19.9% by state-owned enterprises and the remaining 1.2% by foreign ones. Chu Xuejian, Vice Chairman of the Shanghai Logistics Association, said: “It is very likely that consumers will opt for Chinese companies, which charge less, when they want to deliver less important shipments but opt for foreign ones, which charge more but provide better and much safer service for important goods.”
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