Chapter 4: General Observations and Lessons for the United States

The major observations from this scan are organized in four categories— China's economic growth and driving forces; transportation infrastructure development; governmental structure, decisionmaking, and analysis; and global shipper and carrier perceptions.

China's Economic Growth and Driving Forces

The following are observations on factors and driving forces that have contributed to China's impressive economic growth:

1. The economic growth of China over the past 10 years has been dramatic. Both government officials and private sector representatives the team met with during the scan expected this growth to continue in the foreseeable future at or near its current rate. The estimate for 2007 was that China's GDP would increase by about 10 percent. This follows a trend line that shows annual GDP growth of 10.4 percent per year for the past 10 years. The growth in the economy was mirrored by the office expansion of the global companies the team met with during the scan, such as the rapid expansion of subsidiary offices of APL, Maersk, and ProLogis throughout China.
2. Much of the economic growth has been fueled by private investment. As different sectors of the economy have been opened to foreign investment, joint ventures and other financial partnerships have provided the institutional framework for the expansion of the economy. This is especially true in the transport and logistics sectors, where foreign investments have occurred.
3. The economic expansion of China started in the south (Pearl River Delta), moved north based on national economic policy, and is now pushing west based on government policy. Ninety percent of China's exports are manufactured in the coastal provinces, which is causing large demographic shifts that are straining China's resources and social fabric. The "Go West" campaign, an attempt to mitigate these strains, was a continuing theme of the team's discussions with both government officials and private sector representatives during the scan. ("West" refers to the next set of provinces west of the coastal provinces). This national campaign has significant implications to supply chain logistics costs and to the efficiency of the Chinese transportation system in moving exports to the coastal ports. With logistics costs already high in China (about 20 percent of GDP), the movement of manufacturing westward will require efficient intermodal services leading to the coastal ports, 643 to 804 km (400 to 500 mi) away.
4. Although China has had large urban populations for centuries, urbanization has reached unprecedented levels over the past 10 years. Much of China's economic expansion has occurred in urban areas, where the large population provides a substantial labor force. However, many laborers move from one urban area to another looking for jobs, so large portions of the urban labor force are transient. The consequence of such large urban concentrations is that the central government must pay particular attention to these populations and provide resources to make sure their basic needs are met. The term "social harmony" was an often-heard theme to describe the intent of governmental programs. From a transportation perspective, the consequence of this policy focus is that passenger transportation often receives priority over freight movement (although in port cities freight movement often receives close attention from transportation officials).
5. Environmental degradation and energy consumption are consequences of China's rapid economic growth and the equally rapid increase in its urban populations. Air quality in particular has received increased government attention. Although it appears that economic development is still the primary goal of governmental policy, additional goals and performance measures relating to environmental quality and energy consumption have been added to the national agenda.

Transportation Infrastructure Development and Operations

The following are observations on the characteristics of China's transportation infrastructure and how it has been provided:

1. Recognizing the vital role that transportation plays in its goal of continued economic growth, China is investing heavily in transport infrastructure, over 9 percent of the country's GDP. This investment comes from both public and private (joint venture) sources. The current 5-year plan has allocated billions of dollars for a national expressway system, new freight rail lines, port improvements, and 18 new rail intermodal yards. Much of the national investment in transportation is intended to attract private investment to specific facilities, such as toll roads.
2. Substantial levels of private capital are being invested, in some cases with low expectations of rapid return on investment, but investors anticipate long-term benefits from investing in China. This investment has occurred primarily over the past several years in highways, port facilities, and logistics parks. Private investment has been sought in rail infrastructure and intermodal terminals with limited success.
3. China is leveraging its natural geography to facilitate movement of goods. River and coastal shipping continues to be a significant component of China's intermodal transportation system. The Pearl and Yangtze Rivers traditionally have been China's highways to the world. To a large extent, this is true today. China relies on barges and coastal shipping to access its major ports served by rivers. For example, about 40 percent of the containers shipped to Shanghai's new Yangshan Port arrive by barge. New barge-only ports upstream of the Pearl River Delta provide a similar percentage of barge traffic to several container ports in the delta. The central government is also adopting barge design and energy standards along with subsidies for their adoption to improve consistency and efficiency in barge operations. For the development of the ports along the Bohai Bay, rail and truck access is used to bring cargo to the port facilities.
4. The central government's "Go West" policy has shifted investment attention to inland transportation and the challenges facing such transportation, especially the connections to the major international ports. In cases where barge transportation can be used cost-effectively, such as on the Pearl and Yangtze Rivers, inland economic development relies on barge transportation to move a large percentage of the intermodal freight. However, where barge transportation is not feasible or economical, government investment in highway and rail networks provides alternative means of accessing the coast. Both the trucking and barge industries, however, are highly fragmented and consist of many small owner-operators, offering few of the economies of scale that occur with larger companies. Although the market for moving containers is competitive, the limited capacity of individual barge and trucking firms forces shippers to deal with many different operators, increasing the transaction costs associated with moving substantial levels of intermodal freight to the coast.
5. China's intermodal rail service faces significant challenges. The movement of containers receives low priority on China's rail network, following military, passenger, energy (i.e., coal), and food movements. Accordingly, intermodal rail movement tends to be unreliable, often with no scheduled departures. It is estimated that rail handles about 2 percent of the intermodal moves in the country. However, the government is investing heavily in improving this service. Eighteen intermodal yards are in various stages of development, although those that are open are lightly used because of network reliability problems. About 12,000 km (7,456 mi) of freight-only track are being built to separate passenger and freight movements. A goal of 10 million TEUs carried by rail (now less than 3 million) has been established for the current 5-year plan period. However, even with a threefold increase in TEUs handled (which will be a challenge), the market share for rail intermodal movements will still be only 3 percent.

6. The Chinese central government has encouraged joint ventures to finance the national expressway system, stretching government funds to support a variety of new modal investments. Historically, tolls on these expressways have not been used to influence travel behavior, but to raise revenue. However, consideration is now being given in some locales to using tolls to influence truck movement. In Shanghai, for example, a distance-based toll system on a ring road was converted to a considerably less expensive flat toll rate to encourage trucks accessing the port to use the ring road and reduce congestion on other inner-city expressways. This is exactly what happened, but this mechanism is not always possible. The three tunnels between Kowloon and Hong Kong are tolled. The ability to change toll rates is limited, so the older tunnel, priced lower than the other two, has considerably more traffic and is routinely congested. Governmental authorities face heavy resistance to toll increases for social reasons, so the other two toll tunnels, even though they provide what could be viewed as premium service for a higher price, are underused.

   Chinese toll rates are comparable to those in the United States and Europe, but the Chinese believe this does not reflect the economic reality of travelers in China, where the per capita GDP is much lower. Accordingly, the Chinese are trying in some cases to renegotiate concession agreements to allow lower toll rates, but offset lower toll revenues with longer concession time periods (from 30 to 50 years).

   There was some limited indication that, as in the United States, the tolling of highways can run into public opposition. In Hong Kong, for example, truckers and the public opposed tolls on a new highway, so the government had to use its own funds rather than private investment to build the road. The official in charge noted that this represented a perspective of a road as a social asset rather than an economic one.

7. The national expressway plan is centered primarily on three major economic and political centers: Beijing, Shanghai, and the Pearl River Delta. In essence, the national expressway system will be the major means of connection between the political and economic centers of the country, reinforcing their importance in the economic future of China. The scan team noted that all of the new intermodal rail terminals are next to a national expressway, as are ports and major airports. Intermodal connection has been an important consideration in network design.

8. Trucking is the predominant means of moving containers to and from the ports, especially in the river delta manufacturing regions. The trucking industry consists mainly of small businesses (one to three trucks), which makes its contribution to China's economic growth even more impressive. No standard vehicle configuration exists, and little integration of technology in trucking operations is apparent. Truck movements respond to changes in cost structure, as the Shanghai example above shows. The trucking industry is maturing, with a variety of strategies being used or considered to improve industry productivity. Different strategies are being considered for different purposes. American trucking companies are entering into partnerships with Chinese companies to provide financial capital and expertise

   The makeup of the Chinese trucking industry also means that containers do not move considerably beyond the port facilities. Goods are brought into consolidation-deconsolidation facilities, where they are placed in containers for export or devanned for further movement inland. It will be interesting to see how these operations change as China's trucking industry matures and commercial motor vehicles more closely resemble those in the United States or European Union, as well as when China's intermodal rail network is complete and containers can be loaded directly onto doublestack rail for movement west.

9. Given the relatively large number of trucking businesses in China and the intense competition for freight movements, the team was not surprised to find that oversized and overweight trucks have become an important concern to transportation officials. Chinese officials are developing a national strategy for enforcing size and weight regulations, especially on the country's new expressway system, and are considering fixed truck weigh stations. They apparently are not seriously considering weigh-in-motion technologies. A national campaign to enforce load limits has been in place for about a year.
10. Chinese port productivity is the best in the world. Chinese ports operate 24 hours a day, 7 days a week, 365 days per year. Operational strategies are impressive—cranes that lift four TEUs, 20- to 30-minute truck turns, nine cranes working one ship, etc. New ports are being developed and the capacity of existing ports is being expanded rapidly. Although the scan team did not examine any safety data, terminal operators noted that the safety record for Chinese terminals was as good as, if not better than, terminals elsewhere in the world.
11. Given the significant level of trade to the United States and current U.S. legislation, security compliance was a growing concern for port terminal operators. The relatively new infrastructure at China's ports allows terminal operators to build security measures into terminal operations, especially using technologies screening outbound containers. One terminal in Hong Kong has undertaken a 3-year demonstration to show how X-ray and other scanning technologies can be used to screen all containers entering the terminal with minimal disruption to terminal efficiency.
12. China has not progressed to the point of systematically managing its infrastructure; it is still in the "build" mode. Nevertheless, at a few of the more mature areas experiencing significant congestion transportation officials indicated a need to begin paying serious attention to system management.
13. Intermodal connectivity and landside access to Chinese ports are not approached differently or in a more sophisticated way than in the United States or European Union. With the exception of a truck-only access road that was retrofitted from the national network to the Port of Yantian, there was little evidence of the Chinese building into their large container port facilities a dedicated capacity to maintain free flow of cargo. The general consensus is that the congestion would be dealt with when it arrived.
14. Rail access to maritime port facilities is not being consistently built into new port design. With the exception of the Port of Qingdao, which has no river access and which is being looked at as the entry port for land bridge cargo from the rest of Asia to the European Union and Russia, no other port facility was being built with on-dock rail. This appears to reflect the lack of reliability that stems from the low priority intermodal cargo has on the rail network (fourth behind passengers, energy, and agricultural products) and that the majority of the goods made for export are manufactured in the coastal provinces, making the distance from manufacturing facility to export port less than 500 km (310 mi). How this will play out with the building of the 18 intermodal rail terminals and the "Go West" policy will be interesting to watch.

Governmental Structure, Decisionmaking, and Analysis

The following are observations on the institutional structure and process of making transportation investment decisions in China:

1. China's policymaking and implementation process identifies national goals, some of which have performance metrics. However, local officials have leeway in implementing projects so that they also meet local objectives. A national 5-year plan provides policy direction on what will be emphasized during the plan's timeframe (China is now in its 11th 5-year plan).
2. The transportation agencies in the national government have different responsibilities focusing on different modes (e.g., Ministry of Communications, Ministry of Railways, Ministry of Construction). Because governmental officials' performance is measured by results, they pay attention to measures of progress. National data are collected and analyzed on overall modal performance and the state of the economy. Some challenges the national transportation agencies face are responsible for the sometimes conflicting roles of planning, operating, and regulating a modal system. Some viewed this as a hindrance to achieving progress on performance goals. This was the specific reason the CRCT was separated from the Ministry of Railroads and given the sole responsibility of operating the rail network.
3. Data analysis is used to determine the extent to which goals are being met at different levels of government. Some referred to this as "results–oriented planning." The port terminals are all private operations and the terminal operators routinely use metrics.
4. The performance of local officials and local governments is measured against national goals. Many noted, for example, that the most important metric for local officials is the degree to which economic growth occurs during their tenure, defined primarily as job growth for residents. China's tax policy also supports this goal, because the tax revenue from the economic activity in a province stays, for the most part, in the province. Local officials clearly understand the linkage between expanding transportation infrastructure and their ability to create new economic development. While economic development is still the primary metric and motivator, growing environmental concerns appear to be increasing attention on measuring governmental performance on environmental quality (for example, the number of days cities experience a certain level of air pollution).
5. Although the scan team did not conduct a systematic assessment of the capability of municipal government agencies to plan and provide for transportation infrastructure and services, every meeting with local officials included the staff members responsible for each mode. In other words, all of the modes were located in one agency, which encouraged the adoption of a multimodal systems perspective when looking at regional transportation investment. For example, in Shenzhen the relationship among sea cargo, barge transportation, highway travel, and air cargo was discussed with an understanding of how each affected the other. The same was true in the other municipalities visited.
6. In most cases, there was little evidence that Chinese officials sought advice from carriers or shippers on national strategic transportation plans or investments. However, at the provincial and regional levels the inclusion of the private sector in tactical investment decisions was evident in the number of public-private partnerships. Although not reflective of the common practice on the mainland, in Hong Kong, an advisory committee to the government consisting of carriers and shippers routinely provides advice on overall transportation policy. Also, the national government is seeking advice from the private sector as the 18 intermodal rail hubs are being developed.
7. Port development plans considered modal access strategies as part of the planning process, but it did not always result in multimodal port access. The officials responsible for ports, and especially newer ports, were very aware of and concerned about port access. Planning for ports included attention to highway and barge access and, in the case of Shenzhen, rail. This represented a much broader, multimodal perspective on planning than is usually found in the United States. Rail access to the ports is limited, primarily because of a perception that the rest of the intermodal rail network suffers from unreliable and slow service.
8. Project development occurs much faster in China than in the United States. Transportation projects are viewed as a priority for economic development, so they move forward rapidly. Chinese officials noted that project alignments and other project characteristics were sometimes modified by environmental considerations, but they could not identify any project that was stopped for environmental reasons. Given the rapid growth in China's economy and the need for expeditious provision of supporting infrastructure, it is not surprising that environmental considerations are not viewed as a controlling factor in project development (similar to the early years of the U.S. Interstate Highway System). However, it appears that environmental considerations are becoming more important to local officials and that future project development efforts will be influenced even more by such factors.
9. In keeping with the national policy of social harmony, government officials are concerned about the negative impact of transportation facility operations and expansion on local communities. For example, there was evidence that at least two new ports that replaced central city ports were built some distance from the city center to reduce traffic and development pressures on the surrounding communities and the complications of inner-city congestion. When community displacement does occur, efforts are made to mitigate the impacts (e.g., a new logistics park that displaced farmers trained them to earn a living in the logistics park).
10. Hong Kong's role in the competitive market of the Pearl River Delta is evolving. Having the largest container port terminals in south China positioned Hong Kong as a major port of departure for mainland exports. However, new ports in nearby Shenzhen and along the Pearl River (along with dredging in the river to allow access to these ports for bigger ships), as well as new manufacturing development on the west bank of the river, will likely cause a shift in container exports to other ports. Second, certain cost advantages associated with exports through Hong Kong could soon disappear because of infrastructure improvements on the mainland. Third, containers can enter Hong Kong only on trucks driven by Hong Kong drivers. This labor cost is much higher than comparable movements to the Shenzhen ports. Once the special tariffs expire, the cost structure for goods moving though Hong Kong's terminals will not be very advantageous. It remains to be seen how the market will adjust to these changing conditions, but it appears that Hong Kong's relative position in global container flows could evolve in a different direction in the future.

Shipper and Carrier Perceptions

The following are observations made by shippers and carriers in the China market:

1. Many of the international ocean carriers and shippers the team met with during this scan view the serious constraint in international trade and supply chain efficiency as being on the receiving end, in Europe and the United States. The prevalent perception is that terminal throughput in the United States and European Union is limited by terminal operational limitations, landside access capacity, and growing road congestion. There was a strong perception that the United States lacks the political will to invest in infrastructure and could not deliver needed investments in infrastructure in a timely manner even if desired. China is viewed as proactive on infrastructure provision by building for the future and clearly stating in its strategic plans what will be built and when. The United States, on the other hand, is perceived as reactive. The biggest complaint was the length of time it took to reach decisions on transportation projects. Industry representatives expressed an understanding of governmental laws, regulations, and structures, but were frustrated with not knowing a project's fate for a long period of time, so long in some cases that other investment or logistics decisions could not be made.
2. Shippers and carriers believed that the effect of a widened Panama Canal and increased transits through the Suez Canal will likely be more shipments heading to east coast ports, but that west coast ports will still be the major destination for most containers. The shifting of sea routes is in response to transportation costs and the reliability of ground access modes at the west coast ports. With increased capacity at the Panama Canal, some carriers believed it would become a more appealing route than rail or truck services across the continental United States. In addition, carriers mentioned that one constraint in all movements is that the new generation of container ships (10,000 to 12,000 TEUs) cannot physically dock at most U.S. ports. The larger ships are used primarily to serve Europe because of market factors and the capacity of many European ports to handle larger vessels.
3. Several shippers and carriers said bunching of vessel departures from Chinese ports (because of when merchandise arrives at the ports and when it is needed in the U.S. market) causes a significant peaking problem. They observed that a peaking in departures from China usually results in a peaking in arrivals at U.S. ports, especially Los Angeles-Long Beach. Several shippers and carriers believed that this peaking phenomenon could be remedied by working with retailers, shippers, and manufacturers.

Lessons for the United States

The lessons learned from this scan are organized in two major categories—consequences to the United States and its transportation system, and different approaches to planning and project development in support of a growing economy.

1. Under current economic projections in the United States and China, trade flows from China to the United States will continue to grow. China is building the infrastructure to handle them, but there are questions about whether the U.S. transportation system is ready. With a limited number of ports of entry, the U.S. transportation system necessarily concentrates these imports at a few strategic locations. For the United States to remain competitive globally, investment in transportation infrastructure is needed, new system management technologies should be applied, and institutional change in how the country identifies, funds, operates, and makes targeted infrastructure improvements to key elements of the national transportation system should be considered. These improvements help not only to expedite the movement of imported goods, but also to reduce the logistics cost of U.S. companies to compete in the global market.
2. Trade from China increasingly will become an east coast issue. With new service routes through the Suez and Panama Canals, States on the east coast will experience increasing demands on their transportation systems. Shippers and carriers noted that these routes will become even more important if land access to west coast ports deteriorates.
3. Given the navigable draft and terminal capacity of most U.S. ports, the largest container ships will not provide service to the United States. This means that U.S. ports will be served by vessels carrying less than or equal to 10,000 TEUs. With increasing cargo volumes, that means more vessel calls.
4. Similar to what scan teams observed during the intermodal freight scans in Europe and Latin America, the team noted a dramatic difference in port efficiency between China and the United States. Hours of operation, the time to turn trucks, crane productivity, and good land access make Chinese ports very efficient. If U.S. ports are unable to physically expand because of community concerns or terrain limitations, maximizing the use of existing capacity and improving port throughput are imperative to the United States' ability to handle increasing container flows.
5. The United States can learn much from China on using natural geography to the maximum extent, particularly in the use of barge and coastal shipping as access modes to major ports. In China, the Pearl and Yangtze River ports are being developed as transshipment ports, and new manufacturing capacity is being developed and located to take advantage of river transport. Although the United States has few locations where manufacturing concentration is along navigable rivers that connect to major ports, the Chinese experience in barge operations might be informative in those locations where such operations make sense. Even if U.S. river systems and the ports they serve do not provide logical conduits for containerized freight movement, they provide key assets for bulk commodity movement. They need to be well maintained to ensure that goods move efficiently and do not shift to an already-burdened rail and highway network.
6. Freight bottlenecks are viewed as a drain on transportation system and economic productivity. This is a perspective the United States should adopt as well. Solving these bottlenecks involves more than just expanding physical capacity. It also involves using technology and operational strategies. The Port of Yantian is a good example. Ten years after the port was built, it became apparent to local officials that congestion on the roads serving the port was affecting not only freight movement, but also local traffic. They built a truck-separated access route to the port to eliminate the bottleneck.
7. Chinese officials recognize that freight-oriented transportation investments, especially near ports, are an important part of the nation's economic development. Accordingly, Chinese transportation agencies have implemented system management strategies aimed at improving port access. Efforts to encourage more efficient movement of trucks have included setting differential tolls, prohibiting trucks in congested areas, enhancing enforcement of pedestrian and passenger vehicle flows on streets near ports, separating trucks from passenger highway lanes, and encouraging the use of barges as an alternative access mode (although rail does not appear to be a major consideration at this point).
8. The United States is fortunate to have a much more developed rail network, which in many cases provides on-dock service to port terminals. This is a significant advantage to U.S. trade flows and one that needs to be nurtured. The efficiency of the feeder services into and out of U.S. ports will be a key factor in the ability of the U.S. transportation system to support increased container demands from China. The U.S. rail network, although facing congestion issues of its own, still provides an indispensable capacity for moving containers once they reach U.S. ports. Improving the productivity of such services will be an important element of the U.S. strategy to remain competitive in the global market. The team noted that the new Chinese freight-only rail track being built to connect the 18 new intermodal hubs will have no at-grade crossings.
9. Given China's experience with oversize and overweight vehicles and the infrastructure damage it is grappling with, the United States should ensure that its commercial motor vehicle size and weight program continues to advance and receive adequate resources. This is a critical part of the road management system. As the scan team learned in China, when such a program is not in place, roads wear out much faster than expected. Thus, Federal and State efforts to monitor and enforce appropriate size and weight standards on the Nation's road network need to be continued and supported.
10. One challenge facing west coast ports is the bunching of vessel departures from China that result in vessels arriving at about the same time in the United States. This is primarily due to operations in which ships depart Chinese ports over the weekend in response to manufacturing, supply chain, and market requirements. If vessel bunching could be reduced, this could significantly benefit both U.S. and Chinese ports. Shippers and carriers in China expressed some optimism that this could in fact occur.

1. China has a national transportation investment policy that is closely linked to its trade and economic policy. It was clear in discussions with Chinese officials at all levels of government that they were aware of the national transportation policy and what it is intended to accomplish and supported it. China competes as a nation. National transportation investment appeared to focus on two major goals (besides military defense): strategies to foster social harmony among Chinese citizens and strategies to support economic growth, with the second goal supporting the first. Given where China is in its development cycle, there is little question that transportation infrastructure is considered a critical component of the nation's economic future and that creating a transportation infrastructure network is critical to and in some cases leading the economic development pattern. The United States would benefit from adopting national transportation investment policy that supports the nation's economic health and global competitiveness. Transportation, trade, and economic policies that coordinate transportation investment, especially freight-related investment, are vital.
2. The Chinese central planning function is not a model that would work in the United States. However, it is worth considering a strategic investment plan for the national expressway network that is financially supported at the national level and executed locally (similar to the initial effort to build the U.S. Interstate Highway System) and that uses performance measures to monitor progress in developing and operating key system elements. A centrally planned and financially supported national expressway network provides the platform for China to compete as a nation—a united whole that works for the benefit of the entire nation. The three-tiered planning effort the Chinese employ—which covers central, provincial, and local needs—appears to work well in addressing national, intraregional, and local transportation needs. For example, performance measures and standards for the Interstate Highway System might be established nationally, with the means of achieving desired performance left to the States.
3. Many assets that work in tandem with the Chinese transportation system (port terminal development, logistics parks, etc.) are funded through private investment. In some cases, it may take years for the investment to start producing net gains. However, companies made it clear they are willing to invest in China because the Chinese can make decisions and show progress toward infrastructure improvement. A similar confidence in the U.S. approach to decisionmaking and project development was lacking. For instance, a number of private sector representatives pointed to the length of time it takes to complete the environmental process on U.S. projects. They noted that it often exceeds the time companies can place a planned project or investment on hold. While they did not indicate that the United States should stop mitigating environmental impacts, they did point out that a more streamlined process for environmental (or other public) decisions could allow the private sector to look more favorably on business and capital investments. Companies know that in China they will get a timely decision on a proposed investment, but they have little confidence in the U.S. process for assuring that progress will be made. This suggests that if the United States is interested in fostering economic development and encouraging more private investment in transportation facilities, it needs to place greater emphasis on timely public sector decisionmaking. Agencies simply need to get to the decision point earlier.
4. The joint venture is the primary instrument of privatization in China. In almost all cases, private investors do not get a majority share of the investment (the exception being port terminals); government agencies or state-owned enterprises retain control. In some instances, such as the development of 18 intermodal rail yards, private investors have turned down participation in a joint venture because the government stipulations were too stringent. The major lesson, however, is that the model of private funding in China is that government participates in a significant way by steering where the investments can be made.
5. Chinese planning for intermodal centers and indeed for regional transportation networks adopts a systems perspective on performance and investment. The regional highway network, ports, airports, intermodal facilities, and warehousing and distribution centers appear to be planned with an understanding of how they interconnect and affect one another. While multistate coalitions seek to coordinate multijurisdictional activity in the United States, more effort along these lines will be necessary to achieve systems-level coordination.
6. The team learned that Hong Kong's international airport has been the busiest airport in the world since 1996 for international air cargo—not because of air cargo planes, but because of the freight shipped as belly cargo in passenger aircraft. The air cargo market in Hong Kong has grown rapidly but is not viewed as a new market, given the long-established air cargo business in Hong Kong (with the United States as the single largest destination for air cargo originating in Hong Kong). Air cargo is the fastest growing segment of freight movement. While it still is only a small percentage of total tonnage, the implication to the U.S. transportation system of this growth in both air cargo hubs and belly freight is new stress to the transportation network on already-stressed and overcrowded U.S. airports.
7. National data collection in China provides a springboard for national transportation planning, investment, and performance evaluation. This is especially true for investment in freight facilities and services. This is an important lesson for the United States. U.S. freight data systems should not only be continued, but expanded to provide the information needed for optimal transportation investment decisionmaking, especially given the important role that freight plays in the Nation's economic health.