High tolls heavy burden on transport companies
June 1, 2011 Category Logistics, Road transport
Payments of highway and bridge tolls make up as much as a third of the total transport costs incurred by trucking companies. Many trucks are overloaded to make the operation profitable. High transport costs have also prevented consumer prices of vegetables from dropping although farmers are paid very low prices for their produce. Dai Dingyi, Vice Chairman of the China Federation of Logistics and Purchasing, told CCTV that highway and bridge tolls in China are too high for transport companies. Feng Zhenglin, Vice Minister of Transport, said that the Ministry will study the debts, revenues, and charging practices of toll collectors and will reform or shut down collectors that fail to obey the rules. According to statistics from the Ministry of Transport, tolls have ceased since the end of 2010 to be charged along more than 90,000 kilometers of second-class highways financed by government loans. During the same period, 1,723 tollgates were closed in China. The country’s road tollway system employs too many workers and is inefficient, some recent reports suggest. In Luoyang, Henan province, a road company that manages fewer than 100 kilometers of tollways employs more than 400 people and spends about CNY40 million on operational costs each year, according to a report by China Central Television (CCTV). Employing too many people at toll companies raises tolls and the cost of shipping goods. Collecting road tolls has become a lucrative business in China, but only a small group of people share the profits. There are calls for local financial, audit and price departments to place the road companies under stricter supervision, but that might be difficult as toll collection companies are often partly owned by local governments.
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