High Logistics Costs Hinder Development in China Prompting Urgent Need for Reduction

China's social logistics costs remain high, placing a heavy burden on enterprises and affecting economic transformation. Various fees are still widespread, particularly in highways and import-export sectors, with high costs and inconsistent standards, intensifying pressure on businesses. It is crucial to strengthen policy implementation, regulate charging mechanisms, and promote cost reduction to enhance enterprise competitiveness and achieve sustainable economic development.
High Logistics Costs Hinder Development in China Prompting Urgent Need for Reduction

China's persistently high social logistics costs have emerged as a significant obstacle to the nation's economic transformation and quality improvement. Recent data reveals that logistics expenses account for 20% to 40% of Chinese companies' sales revenue—substantially higher than the 9.5% to 10% observed in developed nations. More alarmingly, logistics costs represent 18% of China's GDP , compared to just 8.5% in the United States .

The proliferation of various fees and penalties not only distorts market competition but also suppresses corporate vitality, ultimately driving up logistics expenses. Despite government efforts to eliminate or exempt numerous administrative charges, many fees remain firmly in place.

Persistent Fee Burdens on Businesses

Substantial charges such as vessel registration fees, new vehicle purchase surcharges, and highway tolls continue to impose significant financial pressure on enterprises. Many local governments maintain various service fees under different guises, leaving businesses' actual financial burden largely unchanged.

In the highway transportation sector, excessive toll fees and inconsistent charging standards have exacerbated cost inflation. Surveys indicate that toll rates for trucks exceeding 10 tons typically surpass 1 yuan per kilometer in most regions, with substantial variations in fee structures across different areas. This variability creates considerable challenges for corporate budget planning.

Compounding the problem, the operating periods for many toll roads scheduled to expire have been repeatedly extended, creating additional financial strain.

Mounting Costs in Import-Export Operations

Import and export procedures have become increasingly costly due to various service charges. Customs and commodity inspection authorities frequently require businesses to pay multiple fees through designated third-party service providers. Companies often encounter complex fee structures during customs clearance, including declaration agent registration fees and inspection storage charges, all of which contribute to rising operational costs.

Urgent Need for Reform

Industry experts emphasize the critical need for comprehensive measures to reduce corporate logistics costs. Key recommendations include:

1. Thoroughly reviewing and streamlining port and terminal service fees while prohibiting compulsory services and forced charges

2. Standardizing pricing mechanisms, with essential services funded by government resources

3. Accelerating implementation of the "three-in-one" customs inspection policy to simplify procedures

4. Introducing market competition mechanisms to break monopolies and ensure fair pricing

Economists estimate that reducing China's logistics costs to U.S. levels could generate over 5 trillion yuan in additional economic benefits. Streamlining logistics expenses would not only enhance Chinese companies' global competitiveness but also align with the nation's broader economic development strategy.

Only through effective policy guidance and market mechanism improvements can China achieve healthy, sustainable development in its logistics sector—a transformation with far-reaching implications for the country's economic future.