World Bank helps China improve logistics infrastructure

April 29, 2016

WASHINGTON D.C., April 29, 2016 – The World Bank’s Board of Executive Directors today approved a $100 million loan to China to enhance the connectivity and efficiency of the logistics operations of the Xiaogan Logistics Park in Hubei Province.

“China’s logistics sector has grown over 20 percent a year and is now the largest logistics market in the world. However, China lacks a well-developed logistics network. Connectivity, technology penetration and modern warehousing have been lagging. Through this project, we hope to contribute to the country’s efforts to put in place an efficient logistics infrastructure,” said Reda Hamedoun, World Bank’s Senior Transport Specialist and Team Leader for the project.

Xiaogan Municipality is located 60 kilometers northwest of Wuhan, the provincial capital of Hubei. The rapid urbanization and development of Wuhan and Xiaogan have led to increased domestic consumption and stronger demand for freight. The Xiaogan Logistics Park has been developed as a regional distribution center.

The Hubei Xiaogan Logistics Infrastructure Project will help build the missing connectivity links for the logistics park by financing the construction of a selection of roads and associated utilities (drainage, water supply, power, gas and telecom connections), a logistics information management building, a public information platform, and an intelligent transport system.

Green logistics is a main theme across all project activities. The logistics information management building will embrace green principles in its materials, construction methods and ultimate management, operation and maintenance.

The public information platform and intelligent transport system will contribute to environmental and social sustainability by improving logistics efficiency, alleviating congestion, reducing fuel use, and improving road safety.

The Energy Sector Management Assistance Program, a global multi-donor technical assistance trust fund administered by the World Bank, has provided a US$100,000 grant to support the implementation of best practices for an efficient and green logistics park.

The project cost is estimated to be $151.02 million, to be financed through a $100 million from the International Bank for Reconstruction and Development and $51.02 million from the Chinese government. The project will be implemented in the next five years. Road users, logistics companies in the park, local businesses and residents are expected beneficiaries. An estimated 30,800 people will benefit directly from the project.


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