Logistics challenges for China: drivers of the logistics industry growth, and bottlenecks constraining development

Abstract

In the last two decades, the Chinese economy has witnessed extraordinary growth. China is not only the world’s manufacturing centre and major market, but also an engine for the world’s economic growth. Within this context, China’s transport and logistics industry, as the lifeblood of its economic growth, is attracting increasing attention from industry practitioners and researchers. Given the importance of this sector, understanding industry developments and likely trends over the next few years is a valuable exercise, highlighting the key factors driving such growth, as well as the bottlenecks challenging the transport and logistics industry. This paper reviews the current status of the Chinese transport and logistics industry, analyses industry trends and potential factors driving the industry’s ongoing development including the challenges obstructing growth. China’s extraordinary economic growth, particularly the emerging e-commerce market in China, exposes a number of weaknesses that the Chinese logistics industry is currently not well prepared to adapt to.