VZCZCXRO6240
RR RUEHGH RUEHVC
DE RUEHCN #0222/01 2820425
ZNR UUUUU ZZH
R 090425Z OCT 09
FM AMCONSUL CHENGDU
TO RUEHC/SECSTATE WASHDC 3446
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHCN/AMCONSUL CHENGDU 4140

UNCLAS SECTION 01 OF 02 CHENGDU 000222 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EIND EINV ELTN ETRD PGOV CH
SUBJECT: CHONGQING'S AIR/RIVER FREE TRADE PORT TO BECOME AMONG 
WORLD'S LARGEST, SYMBOLIZES CHINA'S COMMITMENT TO GROWTH IN INLAND 
AREAS 
 
CHENGDU 00000222  001.2 OF 002 
 
 
¶1. Summary: Chongqing's Lianglu/Cuntan Free Trade Port Area, 
China's first inland free trade port, is a huge airport/river 
bonded area with extensive highway and rail links, and will make 
Chongqing the logistics hub of China, local officials boldly 
predict.  Chongqing Airport, the first in China to be approved 
with four long runways, will eventually reach annual passenger 
levels of 75 million, possibly making it the world's second 
busiest, and in the top five for cargo handling.  Of great 
significance, Chongqing has started testing direct rail links to 
Europe via Central Asia and Russia that are cutting shipping 
times in half (14 days versus 28-plus by sea).  End Summary. 
 
"Airport + River Port" Bonded Area is China's First 
--------------------------------------------- ------ 
 
¶2. Consul General, Senior Commercial Officer, and PolEconOff met 
September 23 with Zhu Dalun, Chief Supervisor, and Deng Kai, 
Investment Official, at the Chongqing Lianglu/Cuntan Free Trade 
Port Area (LCFTPA).  Established by State Council decree in 
November 2008, LCFTPA is the first free trade port in inland 
China.  The facility is the only Chinese port that combines and 
interconnects both bonded air and river ports, including 2.37 
km2 of bonded space at Chongqing Jiangbei International Airport, 
and a 6.0 km2 bonded river port at Cuntan. 
 
Chongqing as Future Logistical/Transportation Hub of China 
--------------------------------------------- ------------- 
 
¶3. Chongqing is uniquely positioned in the center of China to be 
a logistical hub connecting both to the nation's booming coastal 
areas to the east, and to Central Asia and Europe to the west, 
Zhu asserted.  To make his case, he pointed to a wall map with 
Chongqing at the center and three almost equidistant spokes 
radiating out northeast, east, and southeast to China's 
principal coastal poles of growth -- the Bohai Sea area 
including Beijing, Tianjin, Dalian and Yantai; the Yangtze River 
Delta including Shanghai, Suzhou, Hangzhou and Ningbo; and the 
Pearl River Delta including Guangzhou, Shenzhen and Hong Kong. 
Three major international package delivery companies -- UPS, 
FedEX, and DHL -- have all been studying using Chongqing's 
international airport has a hub, he stated. 
 
Chongqing Airport to be China's First with Four Runways 
--------------------------------------------- ---------- 
 
¶4. Chongqing's International Airport, currently one of China's 
ten largest, is the first airport in China to be approved for 
construction of four runways.  Chongqing currently has 70 air 
routes providing links to more than 55 cities; within three 
hours one can reach nearly any region of China, and within six 
hours nearly anywhere in Asia.  2008 passenger throughput 
reached 11.2 million, and cargo capacity reached 160,000 tons. 
When all four runways are operational, the company predicts 
annual passenger throughput of 75 million, and an annual cargo 
handling capacity of 2.5 million tons.  (Note: This would make 
Chongqing the second busiest airport in the world. 
Hartsfield-Jackson International Airport in Atlanta, the world's 
busiest in passenger volume every year since 2000, saw just over 
90 million in 2008, with Chicago O'Hare following with just 
under 70 million.  The cargo predictions would put it in the 
world's top five.  End Note.) 
 
¶5. The expansion of the existing airport terminal and 
construction of the second runway will be completed in 2010. 
Zhu did not offer projected completion dates for runways three 
and four, which will be mainly used for cargo, with the third 
runway efficiently ending adjacent to the Lianglu airport free 
trade zone. 
 
Western China's Largest River Port 
---------------------------------- 
 
¶6. The Cuntan International Container Terminal, with the largest 
throughput capacity of any port on the upper and middle 
stretches of Yangtze River, is also the largest of four major 
river ports in Chongqing.  It provides river and airport 
international cargo terminal functions, bonded logistics, 
processing, and trade.  The river port's annual capacity is 
designed to be 1.26 million TEU ("twenty foot equivalent unit," 
or a twenty foot shipping container), though the actual amount 
will be closer to two million TEU.  In 2008, the port moved 
240,000 TEU.  Once the water level of the Three Gorges Reservoir 
reaches 175m, a 5,000 ton vessel will be able to navigate all 
the way to Chongqinq year-round, with 7,500 ton vessels 
available for six months. 
 
A Web of Highways, and Europe by Rail in 14 Days 
--------------------------------------------- --- 
 
¶7. Located at the geographic center of China and sitting astride 
 
CHENGDU 00000222  002.2 OF 002 
 
 
the Yangtze River, Chongqing is already the largest commercial 
logistics hub and industrial center on the upper stream of the 
Yangtze and in western China.  Touting the city's convenient 
road and rail links, "like two concentric wheels with 10 
spokes," Deng said one can reach more than 20 cities in 
neighboring provinces within three hours from Chongqing.  By 
2012, highways will be built from Chongqing to Xi'an, Chengdu, 
Kunming, Guiyang, Changsha, and Wuhan.  By 2015, the city hopes 
to implement planned railway links allowing one to reach 
surrounding provincial cities within four hours, and the Yangtze 
River Delta, Pearl River Delta, and areas of Southeast Asia 
within eight hours. 
 
¶8. As of 2010, Deng reported, Chongqing will have operational 
direct rail links to Europe.  Passing out of China via Xinjiang 
Province into Kazakhstan, the line will run through Russia and 
into Europe, eventually terminating in Luxembourg.  The company 
is already successfully running test shipments to work out kinks 
in customs stops along the way, Deng said.  When operational, 
the rail link will allow containers to reach Europe in 14 days, 
compared to the current 28-plus days for shipments originating 
in Chongqing. 
BROWN