Cabinet comes to aid of logistics sector

Port construction fees levied on importers and exporters to be waived for four months

The State Council has unveiled a slew of policies to help the logistics sector resume work more quickly, with businesses nationwide set to enjoy larger tax and fee cuts and fewer restrictions on operations amid the novel coronavirus outbreak.

A region-specific, tiered and targeted approach must be adopted to encourage businesses in the logistics sector to resume operations, the Cabinet said in a statement after its executive meeting on March 3, adding that any arbitrary restrictions on the resumption of work must be lifted.

Logistics businesses will continue to have their land use tax halved for warehouses that store bulk commodities, and port construction fees normally levied on the import and export of cargoes will be waived between March and June, the statement said.

The government will also lower fees levied on businesses using port facilities and halve incidental charges for businesses using railway freight services, it said.

The meeting passed a decision encouraging insurance companies to lower the burden on the owners of commercial vehicles, ships and aircraft whose operations have been suspended during the outbreak, by way of extending insurance periods and reducing policy renewal fees.

Financial institutions are also being urged to defer interest payments, extend principal repayment periods or roll over maturing loans for toll-road operators unable to repay their debts due to the suspension of tolls, the statement said.

Premier Li Keqiang said at the meeting that clogged logistics networks posed a major hurdle to epidemic control and prevention and the resumption of work and production.

"It is important to cancel various unreasonable curbs as soon as possible," he said. "Local authorities must offer the same treatment in transport policies to businesses operating under various forms of ownership to remove barriers to delivery to villages and communities."

The novel coronavirus outbreak has hit the logistics sector hard, including groups such as truck and taxi drivers.

Passenger volume on roads, waterways and air transport dropped by 79.9 percent year-on-year last month, with cargo volume down by 26.5 percent, according to the Ministry of Transport. Taxi drivers, including those engaged in car-hailing services, saw orders dropping by 85 percent.

The ministry will encourage local authorities to suspend or waive fees that taxi drivers have to pay to cab companies and adjust taxis' fare systems to protect the interests of drivers, Liu Xiaoming, vice-minister of transport, told a news briefing on Friday.

China has suspended tolls on all roads, bridges and tunnels amid the outbreak to spur economic activity, and Liu highlighted the need to ensure that truck drivers are the main beneficiaries of the policy.

Liu Jun, deputy head of the State Post Bureau, told the briefing that 90.2 percent of the country's express delivery workers had returned to their jobs, with over 160 million packages being handled on a daily basis－about 80 percent of the normal capacity.

He said express delivery services were expected to return to full capacity by the end of this week, except for Hubei province, the epicenter of the coronavirus outbreak in China, where express delivery workers were still unable to enter communities due to prevention measures.

In the long-term, the trend was the development of smart service facilities for express deliveries, and the authorities would roll out steps encouraging the development of such facilities and strengthen weak areas in express delivery infrastructure, he said.

Wang Ming, dean of the National Development and Reform Commission's Institute of Comprehensive Transportation, said the outbreak had highlighted the importance of smart and digital technologies in logistics networks and warehousing.

"The most prominent problem for the logistics sector exposed by the outbreak is the lack of coordination," Wang said. "The supplier does not know where the demand comes from, and the demand party does not know where to obtain the supply."