International Shipping Center

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Shanghai International Shipping Center

Shanghai International Shipping Center,After 10 years of efforts, the construction of Shanghai international shipping center has made significant progress including the relatively well-established financial market system, the more advanced port infrastructure, the more efficient shipping service system and the more convenient transportation network. In April 2009, the State Council formally issued the documents to promote the construction of Shanghai’s “2 centers”, explicitly putting forward the overall objectives, tasks and measures of the construction of Shanghai international shipping center.

1 The Effectiveness of the Construction of Shanghai International Shipping center

1.1 The Port Capacity Significantly Enhanced

In 2008, the cargo throughput of Shanghai Port is 582 million tons, the container throughput is 28.01 million TEUs, and the container throughput capacity of the container berths is 18.46 million TEUs, the port continued to be largest cargo port and the second largest container port in the world. The total length of the inland waterways in Shanghai is 2109.8 kilometers. The container ship density of Shanghai Port is nearly 2,200 ships / month (including international routes, 1000 monthly ships), with the route linked all over the world’s major ports; routes for container shipping are opened from Shanghai to the major container ports on Yangtze River, with the density of 700 ships a month. The ratio of waterway-waterway transfer has increased from 25.4 percent in 2004 to 37.1 percent in 2008.

1.2 The Framework of the Shipping Elements System Has Taken Initial Shape

Shanghai has the large shipping company headquarters such as China Shipping Group and COSCO, who both are ones of the world top 10 counterparts in this field, the world’s top 20 liner companies all have their branches or offices stationed in Shanghai, there are 250 foreign representative offices   that operate with international maritime transport and its auxiliary industry in Shanghai, the world’s 9 largest classification societies have set their representative offices in Shanghai, the only state-level shipping exchange in China is also located in Shanghai, moreover there are nearly thousand units operated with the activities of international maritime transport and supporting business in Shanghai. Shanghai has formed the politburos and advisory services like International Shipping Research Center, Shanghai International Liner Economic Research Center and Shipping Finance Research Center.china business registration and form Shanghai Maritime affairs Court and Shanghai International Shipping Center Court have been set up in succession. The shipping elements of international shipping center are gathered gradually.

1.3 The Construction of the Aviation Hub Speeded up

By the end of 2008, a total of 81 domestic and international airline companies operate scheduled flights to Shanghai, and Shanghai owned the flights to 198 cities at home and abroad; in 2008, the 2 airports in Shanghai achieved 450 thousand sorties of aircraft movements, with a passenger throughput of 51.11 million passengers and a cargo and mail throughput of 3.02 million tons, the Pudong airport is even more ranked third in global with 2.598 million tons of cargo and mail throughput, Shanghai has finished the initial establishment of the international air cargo hub. Pudong International Airport expansion project was completed and put into operation in March 2008, Hongqiao Airport expansion project will be basically completed and put into operation in next March, the scale with 2 airports, 5 runways and 4 terminals in a city will formed then.

1.4 Port Service Function Strengthened Significantly

Shanghai took the lead in China to launch the “great customs clearance” project to explore the customs clearance modes such as “paperless customs clearance”, “applying for quarantine inspection in advance, declaring in advance, discharging with real products”, and the “5 +2” work system and one-gate service. Waigaoqiao Bonded Logistics Park carry out the “zone-port interactions” firstly over the country, Yangshan Bonded Harbor Area is the country’s first bonded port area.

1.5 A Better Developing Environment for Shipping

Shanghai has the comprehensive comparative advantages on industrial base, business environment, science and technology education, human resources, integrated transportation system, informatization level and ancillary services capacity, which provide a good developing environment for the shipping services industry.

2 Ideas about the Development of International Shipping Center

By 2020, Shanghai aims to basically establish the international shipping center containing a high concentration of shipping resources and shipping services functions, a good marketing environment, modern and efficient logistics services, as well as a global shipping capacity of resources allocation; basically form the international shipping hub collaborating with other domestic ports in a reasonable division of labor, with Shanghai as the center, Jiangsu and Zhejiang as wings and Yangtze River as its hinterland; basically formed large-scale, intensive and fast, efficient and optimized modern port and the international aviation hub to achieve the integration of various modes of transport; basically formed modern shipping service system with high-quality services and full-featured modern shipping service system, both of which create a convenient, efficient, safe and legal environment for ports and modern international maritime port services so as to strengthen the integration capability of international shipping resource as well as enhance overall competitiveness and service capacity.

3 Main Tasks and Measures of the Construction of International Shipping Center

3.1 Optimization of the Modern Shipping System

In order to meet the requirements of regional economic integration, Shanghai will integrate the resources of Yangtze River Delta port to establish the port with clear division of labor, complementary advantages and orderly competitive environment, enhancing the port’s overall competitive ability. It will accelerate the infrastructure construction of Yangshan Deep-water Port and expand the throughput capacity. For the purpose of improving the overall transport capacity, Shanghai will also promote the construction of inland waterways, railways and airport facilities, optimize transport resources, increase highway access appropriately and make great efforts to develop long-range air transportation. We will also promote the development of the linkage with inland water transport, take full advantage of the Yangtze golden waterway, accelerate the development and promotion of direct sea-river ship, take measures in terms of the marine technology and safety management to promote the sea-river direct line of Yangshan Deep-water port and vigorously develop its transit.

3.2 Development of the Modern Shipping Service System

Shanghai will actively take measures to reduce the cost of international container transit, like encouraging the transshipment of China’s foreign trade container at the Shanghai international shipping center. Shanghai will also give full play to its location advantages of closing the major international marine routes and the comprehensive advantages of the industrial base, human resources, business environment and so on to vigorously develop various kinds of shipping service institutions such as ship trading, management, agents, consulting, technology and other types of maritime shipping services, expanding shipping services industry chain, extending the development of modern logistics and other related industries, as well as continuously improving shipping service functions. We will also improve the layout of the shipping service plan, further expand the Yangshan Bonded Port functions and develop gathering areas of shipping service like the North Bund, Lujiazui and Lingang, etc. To establish a model of ship trading market in Shanghai, Shanghai will lead the healthy development of the ship trading market, give full play to the dissemination function of information on Shanghai Shipping Exchange and accelerate the construction of the national ship trading information platform. Except that, Shanghai will also establish a comprehensive information-sharing platform of the Shanghai international shipping center, aiming to set up a convenient and efficient shipping information exchange system of the Yangtze River Delta region and the Yangtze River port.

3.3 Establishment of the Experimental Area of the International Shipping Development

Aiming to enhance the international competitiveness of China’s shipping enterprises, Shanghai will learn from the support policies of shipping developed countries (regions) and implement support policies related to the international maritime businesses. For instance, Shanghai will extend the cut-off date of the China-funded “flag of convenience” shipping special case of tax reduction from June 30, 2009 to June 30, 2011. Moreover, it will also allow enterprises to set up offshore accounts to fund their overseas operations and, facilitating the settlement of shipping enterprises. Under the premise of the perfect regulatory system and  effective prevention of cheating the tax rebate, shanghai will implement departure tax policies and encourage the transit services of Yangshan Bonded Port Area, exploring the innovation of management system in  special supervision areas of customs and rendering the Yangshan Bonded Port Area functioning.

3.4 Completion of Matching Policies Supporting the Development of Modern Shipping

Shanghai will accelerate the development of shipping financial services, supporting the implementation of high-end services including shipping finance and insurance, etc. It will also actively develop variety kinds of shipping financing such as equity investment funds, which will provide service to shipping financing and manufacturing. It will also allows large-scale shipbuilding enterprises to participate in the formation of financial leasing companies which are actively and steadily encouraged to enter the inter-bank market to lend money and issue bonds. Furthermore, Shanghai will actively examine the powerful financial institutions and shipping companies to set up specialized maritime insurance institutions located in Shanghai.

3.5 Promote and Regulate the Development of Cruise Industry

Major offshore cruise companies are allowed to register operating agencies in Shanghai and carry out approved cruise services of international routes and encouraged to be affiliated to Shanghai port and other qualified coastal ports, which will gradually turn Shanghai into a cruise home port. Shanghai will also facilitate the business environment for the cruise operators, establish the financial service system of cruise industry and set up a special guideline in terms of insurance, credit and other aspects to promote the healthy and orderly development of the cruise industry.

4 Creating the Favorable Business Environment Actively

4.1 Smooth the channels of communication vigorously

Shanghai will hold “Shanghai International Shipping Forum” on the foundation of the cooperation of the relevant departments and the city every year, in order to provide a discussing platform on the major issues in global shipping for the shipping industry leaders and renowned experts, promoting and deepening the dialogue and cooperation in global shipping.

4.2 The Implementations of the Preferential Taxation Policies

1The implementations of the exemption in sales tax

Incomes obtained in the international shipping insurances, of the insurance companies registered in Shanghai, are exempt from sales tax. Incomes from the business of international shipping, cargo transportation, warehousing, loading and unloading, of the shipping enterprises and logistics service companies registered in Yangshan Bonded Port Area, are exempt from sales tax. The effect of policies will expand to attract more domestic and foreign shipping companies settling in Shanghai.

2Actively promoting the tax rebate measures in ports of departure

We will promote the tax rebate measures in ports of departure come into effect. The routes from Shanghai to Qingdao and Wuhan expect to be the first experimental units by the end of 2009, which means, goods being shipped from Qingdao and Wuhan to Yangshan Bonded Port could be tax refunded in the departures, so as to greatly reduce the uncertainties brought about by the tax rebates in different customs area, facilitate the transfer among different customs areas, accelerate the cash flow of export companies.

3Continuing to implement the tax-free policy of registered special case

The tax-free policy of registered special case, means , based on the existing system of ships registration, the qualified Chinese-funded ships registered during from 1 July 2009 to 30 June 2011, could do the duty-free imports and registrations of ships after approved by Ministry of Finance. The introduction of this policy has effectively resolved the issue of high tariffs on imported vessels, while allowing the naturalized ships participating in domestic transport conditionally. 25 ships has came to register by now(18 in Shanghai and 17 in Tianjin).

4.3 Developing Vigorously the Shipping Financial Services Industry

The People’s Bank of China and the Banking Supervision Commission jointly issued the management measures of the issuance of financial bonds in the inter-bank bond market by leasing companies, by which the financial leasing companies obtained a policy basis for issuance of bonds. October 16, the Shanghai Shipping Exchange released formally a new version of Shanghai Containerized Freight Index (SCFI), the new version of SCFI laid the foundation in accelerating the development of shipping freight index derivatives, it will be the reflected vane in Shanghai international container liner shipping markets, as well as the settlement of the transactions of global international container freight derivatives. In addition, preliminary ideas have been formed on allowing financial leasing companies set up by large vessels manufacturing, enterprises setting up offshore accounts, the formation of the shipping industry fund, and establishment of a professional shipping insurance companies.

4.4 Actively Promoting the Cruise Industry

October 6, General Office of the State Council issued “The notice on improving the management of supply market of international sailing ship port”, with the announcement of decontrol of the supply market on international sailing ship port; October 19, the Ministry of Transport officially released “the bulletin of multi-point affiliated service for foreign cruise in China”. The implement of the 2 documents will create favorable conditions for promotion of Shanghai cruise industry.

4.5 Actively Making Innovations in the Management System of Special Authority Zones

We will further increase the openness of the special authority zones, in order to create a more relaxed and convenient services for the shipping companies, to promote the implementations of the second collected waterway-waterway transfer and the bonded automobiles exhibitions, to research on promoting the linkage development mechanism of “3 ports 3 zones”.

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