As President Xi Jinping visits Spain today, a surprising coincidence is the arrival in Madrid port of an inter-continental freight train from Jiwu port in China on the same day. An efforts launched in 2003 has materialized so magnificently playing perfectly into Chinese railway diplomacy, a part of worldwide infrastructural diplomacy of Road and Belt Initiative.
Almost two years have passed since the first freight convoy departed from Yiwu and stopped its machines at the Madrid-Abroñigal station. Since then, the Chinese and Spanish authorities worked to promote the longest railway line in the world , with 13,052 kilometers, which crosses eight countries (China, Kazakhstan, Russia, Poland, Germany, France and Spain), known as “the new silk Road”. The Yiwu-Madrid line is one of the most ambitious macro-project of foreign policy in the People’s Republic of China.
It comprises of a group of commercial railways that reaches 65 countries, which collectively account for 60% of both the population and the world GDP. According to Spanish media reports on the genesis of the project, it was Chinese President Xi Jinping who asked his counterpart Mariano Rajoy to join Spain in this comprehensive initiative that is based on five major structural pillars: infrastructure, trade, investment, financial cooperation, and exchanges between societies.
But why a train between Yiwu and Madrid? The inaugural caravan left Yiwu for Madrid in November 2014, while the first return train bid farewell to the Spanish capital in February 2015. Why was Yiwu chosen as the starting point for this route between China and Spain? Chinese writers said it was because the city, located 300 kilometers from Shanghai, is accredited by the United Nations and the World Bank as the largest wholesale market in the world. The city, with more than one million inhabitants, has some 75,000 stores. She has been named as the standard-bearer of the Chinese market economy due to her wide variety of products.
In addition, it is not for less, since it is estimated that 90% of Chinese products sold in Spain come from Yiwu.The lines that depart from the Chinese locality remain regular, with a train a week and those that leave Madrid are still in progression. Spain had extensively publicized this project. The Royal Elcano Institute then organized a round table with the theme: “Spain and the new silk route: how to take advantage of the Madrid-Yiwu train” .This event was moderated by the director of the Elcano Royal Institute, Charles Powell. Other in attendance then were the deputy director of Inditex , Carlos Parga; the president of the Foundation for the Exchange between Yiwu and Spain, Mao Wenjin; the economic adviser of China in Spain, Chen Yuming; the ex-economic adviser of Spain in China, Javier Sierra; and the main researcher of the Asia-Pacific area of the Elcano Royal Institute, Mario Esteban .
Among the most outstanding advantages of the Madrid-Yiwu train, the speakers underlined the diversification of opportunities that it brings to national firms when exporting their products, covering a gap that did not exist until now. For example, for Mario Esteban the railroad opens “the possibility that Spanish products arrive quickly in China that were not previously possible through the old transport processes. Mainly perishable products, whose shipment by boat were too slow for the food conditions and the trip in airplane too expensive for the industrialists. It is a more affordable channel than the air environment and it does not have as much delay as the maritime one (by train it takes less than 20 days, in a ship of 35 to 40 days). In addition, the railway line has just incorporated a green channel with which to overcome the customs procedures of goods arriving from Spain.
“Something very favorable for SMEs that are not familiar with Chinese procedures,” says Esteban. Deposits have also been incorporated in Poland and Germany for the loading and unloading of goods, a fact that offers companies more flexibility than in ships and airplane,” according to the researcher at the Elcano Royal Institute.
Likewise, with the intention of improving service and offering added advantages to small and medium-sized Spanish companies , Madrid-Yiwu train managers are working on the coordination and articulation of a combined demand so that different SMEs can make joint shipments to share costs and space in the car .
For his part, the economic adviser of China in Spain, Chen Yuming , stressed that this route is an “idea of strategic development for China and the world” He said that “the world economy has not come out of its influence of the financial crisis and with this development plan we can overcome the difficulties to increase the world economy.
Spain and China have thus launched a far-reaching freight rail agenda that is sure to have wider effect on world economy. Therefore, as Chinese leader strolled into the Spanish palace, remember a closely-knit commercial tie is in place between the two nations.