The “new silk route”: From Yiwu to Madrid

In 2014 was inaugurated the largest railway for merchandise transport of the world that links Madrid (Spain) with the city of Yiwu (China) and has a distance of 13052 km. That line forms part of a big project from the chinese government and it follow the three lines that links german cities and chinese cities. 

These lines had a volume of 400 trains in 2015 that suppose more than 30000 containers and 200 in the current year The spanish route has had a volume of 40 trains since the first shipment at the end of 2014.

The Madrid-Yiwu route recorre 8 countries (Spain, France, Germany, Poland, Belarus, Russia, Kazakhstan and China) as is possible see in the following map.

Madrid-YiwuSource: Daily Mail Online

This route means an improvement in the possibility of transport products to China for the european producers. Moreover they have a new way of connect with the most important country for european imports.

Transport by train represents one important alternative to the maritime transport with a reduction of already 10 days of shipments time. While a train spends 21 days in cover its route a boat arrives to China from Spain in already 30-35 days. That time is superior in the case of boats that departure from Germany where the save of time is bigger than in the spanish case.

Ship a container in a boat from Spain to China costs 1200 $ and send a container in the train have a cost of 2000 $. That means a biggest cost but it is lower than the cost of a ship by airplane that has a high cost but is the fastest way of make a shipment. Another interesting characteristic of the train shipment is its friendly environmental level in comparatio with the shipment by boat.

The time of the train route is increased because the train must do 3 changes of railway width, one in Irún (Spain), other Brest/Malaszewicze (Russia/Belarus) and the last in Dostyk/Alashankou (Russia/China). When that problem will be solutioned the train route between China and the UE will be more competitive.

One of the problems that explains the low growing of the Madrid-Yiwu line in comparison with the German lines is that the train arrives full of Chinese products and go to China half full. However the expectations are that the traffic of the route grows until 2 times per week in the following years.

The next map is about the project from China for develop a new silk road with the objective of improve their communication with Europa creating a Eurasian hub. In an intent for reduce the dependance of their commerce of the maritime transport.

rutadelasedaSource: ElEconomista

 It is clear that the German connection are working but the question is: Will the spanish companies capable of take profit of that new connection with China? The line open a new option for connect with the fourth market for the spanish exports.

Links of interest:

https://www.theguardian.com/business/2014/dec/10/silk-railway-freight-train-from-china-pulls-into-madrid

http://grupobicex.blogspot.com.es/2016/01/el-tren-mas-largo-del-mundo.html

http://economia.elpais.com/economia/2016/03/18/actualidad/1458329302_446055.html

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