China - Shanghai
A large portion of the 4 trillion RMB stimulus package announced in Nov. 2008 will go towards infrastructure projects such as railways, highways, airports, etc. Although some of these investments should be new investments, it still remains unclear how much was already imbedded in existing spending plans. Rail construction projects over the next 4 years include: Shanghai to Nanjing and Shanghai to Hangzhou urban railways, Shanghai to Beijing high-speed railway, Shanghai Pudong suburban railway and Shanghai-Jinshan suburban railway. Until 2020, Shanghai also plans to spend about 30 billion for subway construction, including 510 km subway lines by 2012 (400km by 2010). Similarly, Nanjing will complete 9 subway lines for a total of 201.3 kilometres of track by 2020 (60.4 km by 2010). As for airports, PudongAirport, HogqiaoAirport and NanjingAirport, all have plans for upgrade and expansion. The same is also true for ShanghaiPort, Ningbo port and Port of Lianyungang in JiangsuProvince.
The East China market is home to 2 major Chinese carriers: China Eastern Airlines (CEA) and Shanghai Airlines and a number of regional passenger and cargo carriers. The airlines of East China expect delivery of a number of new aircrafts over the next few years. However, in Dec. 2008, the Central government asked airlines to suspend purchase of new planes from foreign manufacturers. Nevertheless, with Chinese carriers increasing their fleet size, opportunities also exist for belly cargo (for expanded passenger routes) and for freighters. However, some of these opportunities will depend on the delivery of ordered aircraft.
Currently only Air Canada and CEA have direct passenger service between Canada and Shanghai. Shanghai connects to YVR by both AC and CEA and to Toronto by AC only. There are persistent rumours regarding a possible merger between CEA and Shanghai Airlines. This possible restructuration could have an impact on Canadian stakeholders such as the airports in Vancouver, Toronto, Montreal, Halifax, Winnipeg that have been trying to court both Shanghai Airlines and CEA.
In May 2008, the Chinese central government created COMAC to oversee development of a Chinese 150-seat commercial jet by 2020. COMAC is headquartered in Shanghai and its assets include: AVIC 1 Commercial Aircraft (the Shanghai firm that oversees the ARJ21 regional jet programme) FAI (the country's leading design institute for commercial aircraft) and Shanghai Aircraft (which performs the ARJ21 final assembly). The AR21 (90 seats) completed its maiden flight at the end of Nov. 2008.
Due to increasing demand upon China's airlines and the nation's desire to develop its aerospace industrial base, significant supply, investment, and JV and/or joint manufacture opportunities exist for Canadian aircraft and components manufacturers, MRO companies, and training providers. Niche opportunities exist for Canadian companies able to provide parts and services for regional, business and rotary aircraft.
East China is a very important part of China and is home to the Yangzi River Delta. Yangzi river is 6,300km and there are more than 10 ports along the river. With 2 of China's most important ports located in East China (Shanghai and Ningbo ports), Shanghai, Zhejiang and Jiangsu provinces accounts for 34% of imported goods into China and exports 40% of China's goods. The heavy concentration of FDI in Shanghai and Jiangsu and more specifically the supply-chain system developed by multinational enterprise subsidiaries account for a large proportion of the China's total trade with the rest of the world. Given East China's importance as a shipping and manufacturing hub, all the key players to be targeted in promoting APGCI are located in our territory.
In 2008, despite the impact of global financial crisis imposed on the shipping industry, Shanghai port's container throughput was up 7% to 28 million TEUs, maintaining its No. 2 ranking in the world after Singapore. Shanghai is recognized as the no. 1 port in China in terms of liner routes, service frequency and network coverage. In 2008, Port of Ningbo entered the group of the world top ten container ports in terms of TEU throughput (no. 8). In the field of shipping, logistics and transport, the East China region is becomingly an increasingly important area to consider, particularly as Canada actively promotes the potential of linkages through the APGCI.