First proposed in June 2018, the SCODA is becoming an important link in international industrial, supply and trade chains, boosting economic and trade cooperation of the Shanghai Cooperation Organization (SCO) countries.
It is also a zone for industrial cooperation, having attracted more than 70 projects with a total investment of over 200 billion yuan (about 27.9 billion U.S. dollars).
Recently, 110 standard containers of used automobiles and auto parts transported by a ship from Incheon, the Republic of Korea, were reloaded onto a train in the SCO demonstration area bound for Almaty, Kazakhstan, a rail trip lasting 16 days.
The express railway service is an epitome of how the SCODA has been building a new logistics corridor to facilitate regional economic and trade cooperation.
Zang Yuanqi, a SCODA management committee official, said the demonstration area has set up a multimodal transportation service platform covering railway, sea, air and land ports, and customs and other government departments, ensuring speedy logistics for SCO and Belt and Road partners.
Based on the transport advantages of Qingdao, a coastal city, the multimodal transportation service is quickly making the demonstration area a gateway to Asia Pacific for SCO countries.
Apart from sea, air and road transport, the demonstration area operates 31 international freight train routes, reaching 54 cities in 23 Belt and Road partner countries.
With an efficient multimodal transportation network and simplified cross-border trade settlement and customs clearance, the demonstration area is building a Silk Road e-commerce base, said Zhang Dong, deputy director of the SCODA management committee.
Earlier this year, several Kazakh enterprises reached a cooperation intention with the demonstration area to set up a trading center in Qingdao for specialty agricultural products from Kazakhstan.
"We chose to cooperate with the SCODA because of its good geographical location, which offers huge sea, rail and air transport advantages," said Manarbek Tulegenov, chairman of EUROLOG LLP, a Kazakh logistics company. He added that entering the Chinese market is in the company’s strategic plan.
The SCODA is an important platform for logistics, trade, and investment cooperation between Central Asian countries and China, providing huge opportunities for Central Asian countries, said Botakoz Yelshibek, head of the Kazakhstan exhibition area at the SCO International Investment and Trade Expo held in Qingdao in June.
"China’s economic growth momentum is strong, and I hope that more Kazakh businesspeople will continue to deeply integrate into China’s new development paradigm and achieve win-win results through cooperation," Yelshibek said.
The demonstration area has set up a comprehensive economic and trade platform to offer one-stop services covering trade, customs clearance, logistics, and finance. Nearly 5,000 enterprises have registered on the platform.
Said Saydakhmedov, a business specialist from Uzbekistan working for the platform, said many businesspeople from Belt and Road partner countries hoping to explore the Chinese market consult on issues related to laws and regulations, finance and tax, and subsidy policies.
The platform provides facilitation for pine nuts trading company Alhaj Mohammad Nazi Sadat Ltd of Afghanistan, which exports 70 percent of its products to China, helping the Afghan company to find Chinese clients, which means it is not solely reliant on expos and intermediaries.
With one-stop services on offer, pine nuts exported by the company can now reach Chinese warehouses in 15 days, cutting up to two-thirds off the delivery time.
The demonstration area has also either introduced or nurtured 10 trading platforms, linking more than 2,000 trading companies in doing so.
The SCO expo in June this year attracted 330 enterprises and institutions from 34 countries and regions, displaying more than 10,000 kinds of commodities from SCO countries, making it a big stage for Belt and Road cooperation.
Thanks to appropriate measures, the area’s trade with SCO countries had surged to 8.1 billion yuan in 2022 from 850 million yuan in 2019.
Further expanding overseas cooperation, the SCODA also signed a cooperation agreement with Kazakh logistics company DAMU in September.
The Chinese side can provide advanced experience and solutions as well as financing support, which is of great significance and attractive to the foreign partner, said Mayra Jumagaleeva, director of DAMU.
Seventy percent of DAMU’s imports come from China and Chinese vehicles are popular in Kazakhstan and have bright market prospects there, Jumagaleeva added. DAMU is planning to further build a platform selling China-made vehicles to Kazakhstan and other Central Asian countries.
The company expects that the cooperation agreement will activate further trade and investment cooperation and in the long term promote the construction of relevant free trade zones within the SCO framework, said Jumagaleeva.
As a unique economic and trade zone for SCO countries, the SCODA has massive potential and plays a key role in promoting new technologies and technology conversion in SCO countries and boosting international economic and trade cooperation, said Hakimov Masum, an official of Uzbekistan’s Tashkent State Transport University.