Summary of Key Points
The logistics network has been included in the national “six major infrastructure networks” (such as water transportation and new power grids), elevating its status from a traditional supporting facility to a core strategic foundation for the national economic cycle. In the future, by developing a dual-pillar system consisting of a physical network and a digital network, the current issues of high logistics costs and poor intermodal transport connectivity will be addressed. The goal is to establish a modern logistics network by 2030, which will reduce circulation costs, facilitate economic activity, and unleash economic benefits.
Detailed Analysis
1. The Upgrade in the Status of the Logistics Network: From Supporting Role to Core National Strategy
Previously, logistics was merely seen as a delivery service, an integral part of the industrial chain. However, it has now been elevated to a key national infrastructure component. Liu Jingzhen, chairman of China Logistics Group, states that this marks the logistics network’s transformation into a “core strategic foundation” for the national economic cycle. He compares it to the foundation of a building; without a robust logistics system, the economy cannot function smoothly. The state has repeatedly emphasized the construction of these six major networks, and the National Development and Reform Commission (NDRC) is planning a special modern logistics development plan for the 14th Five-Year Plan period, indicating that the logistics network is seen as a critical lever for expanding effective investment and stabilizing the economy.
2. The Logistics Network as the “Aorta” of the Economic Cycle: A Critical Linking System
The logistics network is not just a combination of vehicles and roads; it is a comprehensive service system that spans regions and industries:
- Connecting Production and Consumption: Goods from factories must reach stores and consumers, and agricultural products from rural areas must be sold in cities, all relying on the logistics network.
- Linking Urban and Rural Areas, as Well as Domestic and International Markets: The network facilitates the flow of goods between rural outlets and national logistics hubs, as well as domestic and international transportation by sea or air.
- Solid Foundation: The physical infrastructure includes a network of major transport corridors, 181 national logistics hubs, and 105 cold chain facilities. The NDRC has also issued 210 national logistics standards during the 14th Five-Year Plan period, improving data sharing capabilities. National logistics hubs enable the seamless integration of various modes of transportation (road, rail, water).
3. The Dual Pillars of the Logistics Network: The Physical and Digital Networks
Two networks are essential for its success:
- Physical Network: This network provides tailored services that align with industrial needs. China Logistics Group’s physical network covers 33 provinces and 86 major economic cities, with 344 storage facilities (26 million square meters) and 44 futures delivery points. It follows the flow of industries, delivering logistics services directly to production sites—for example, it can deliver parts to automobile factories without the need for manufacturers to stockpile them in advance.
- Digital Network: Utilizing AI to address industry challenges such as information asymmetry (traders unable to find transport, drivers making empty trips), the digital network redefines logistics processes through big data and AI. For instance, China Logistics Group’s “Liuyun” model (with 278 billion parameters) includes:
- Intelligent matching of goods with returning drivers, reducing empty trips by 30% and increasing transaction rates by 10%.
- Advanced packaging inspection systems, improving efficiency by 70%.
- Automated bidding processes, increasing efficiency by 70% and reducing the risk of evaluation errors by 90%.
- Online customer service, with consultation resolution rates rising from 30% to 80%.
The digital network transforms logistics from a reliance on experience to one that relies on data, essentially giving it a “smart brain.”
4. Current Weaknesses and Areas for Improvement
Despite progress, there are still two major issues:
- High Costs: In 2025, China’s total social logistics costs accounted for 13.9% of GDP, higher than developed countries (e.g., around 8% in the United States). A reduction of even 0.1 percentage points could save over 100 billion yuan—equivalent to several tens of yuan per person nationwide.
- Poor Intermodal Transport: Not enough railway lines connect ports and industrial parks, with only 50% of major container ports having rail access. This leads to additional costs and time delays in transporting goods.
The NDRC aims to resolve these issues by 2030, creating a logistics network that features coordinated hubs, interconnected corridors, and sustainable, intelligent systems, making transportation more efficient and cost-effective.
5. The Economic Benefits of the Logistics Network
The construction of the logistics network brings several benefits:
- Cost Reduction: By optimizing resource allocation through network scale effects, overall logistics costs can be further lowered.
- Smoothed Economic Circulation: It facilitates the flow of goods and resources between production, distribution, and consumption, enabling faster market transactions and timely supply of raw materials.
- Economic Resilience: The logistics network acts as a buffer for the economy, ensuring the smooth delivery of essential supplies during crises (e.g., pandemics) and stabilizing supply chains in times of international trade fluctuations.
Liu Jingzhen emphasizes that building a strong logistics network is not just about creating transportation infrastructure but also about enhancing the resilience and strategic depth of a major economy—just as a well-functioning circulatory system makes a body more resilient.
In summary, the logistics network is now a key national priority, aiming to make life more convenient (with faster and cheaper deliveries), businesses more efficient (by reducing logistics costs), and the economy more stable through the development of both physical and digital networks.