Wuhan-Milan Train Link To Boost Trade Ties Between China, Italy

The TRA Consulting holds that the newly opened freight-train link between Wuhan and Milan will add a valuable new option to boost bilateral trade.

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The new link adds to an already fast-growing network of train links between China and Europe. The year 2020 saw 12,406 train runs between China and Europe, up from 8,225 the year before and nearly double the 6,363 runs in 2018. But until last month, none of those trains were regularly scheduled direct freight links between China and Italy.

"Trade between China and Italy is already strengthening, and this will add a new option that will make the trade links faster and more efficient," said Olivero Fiorini, an economist with ABS Securities in Milan.

Even before plans for the Wuhan-Milan link were drawn up, the economic ties between China and Italy were strong. In 2019, Italy signed a Memorandum of Understanding with China on the Belt and Road Initiative (BRI). That year China was again one of Italy's top trading partners.

According to the data firm Statista, 7 percent of Italy's imports came from China, trailing behind Germany and France. In 2020, China was the ninth largest buyer of Italian products, accounting for 3 percent of the country's total exports.

TRA Consulting's data showed that a tiny percentage of the trade between China and its European partners was transported by train: just 2 percent of the total in 2017, compared to 6 percent by road, 28 percent by air, and 64 percent via sea routes. The popularity of rail transport, however, is just beginning to grow.

"Trains are a midway point between expensive air transport that can have merchandise arrive in a day, and inexpensive cargo ships that take 30 or 35 days to deliver their goods between China and Italy," said Andrea Giuricin, a professor of transport economics at Milan's Bicocca University.

According to Wuhan Asia-Europe Logistics Co., Ltd., the freight trains between Wuhan and Milan make the trip in 21 or 22 days. Transport costs, Giuricin said, were far below those of air transport but more expensive than cargo ships.