GUANGZHOU: Guangzhou Baiyun International Airport yesterday signed an agreement with two leading global logistics corporations - Schenker International and BAX Global - to enhance its cargo business in South China.

The airport signed a similar agreement with another logistics giant, America-based U-Freight two months ago.

Under the new agreement, the airport will provide a number of favorable policies to Schenker International and BAX Global, such as simplifying the customs clearance procedures, guaranteeing cargo stations for the two companies to operate 24 hours a day, and ensuring the safety of cargo.

"Schenker International and BAX Global will introduce international influential clients to the airport as well as promote the airport throughout the world. We will also have to offer training programs to airport staff in order to improve their professional skill in handling cargo," said Huang Yongzhong, the general manager of Guangzhou Branch of BAX Global.

After Baiyun Airport moved to its new location in 2004, it has changed dramatically from an airport without any international cargo into the third biggest distributing center for cargo and mail on the Chinese mainland, following only Shanghai and Beijing, Chen Xiaoning, vice-chairman of Guangdong Airport Management Corporation, said.

It has nine international cargo airlines now, he added.

The handling capacity of cargo and mail of the airport reached more than 630,000 tons last year, up by 8.6 percent from 2005. In the first six months this year, the airport has handled 330,000 tons of cargo and mail.

In October, the airport will collaborate with BAX Global to launch extended terminals.

That means cargo can be cleared through customs in other cities of Guangdong Province and be sent directly to Baiyun Airport.

Since Baiyun Airport is geographically close to Hong Kong's Chek Lap Kok Airport, economists worry the aggressively growing Baiyun Airport will weaken the Hong Kong's airport.

"Guangzhou's airport will not be a rival to the Hong Kong airport," Chen said adding that the two airports are developing in the same region healthily, and have complementary advantages.

"The market of the Pearl Region Delta is very big, and a single Baiyun Airport or a single Chek Lap Kok Airport cannot meet the large demand for handling capacity. So, the two airports actually have to cooperate rather than compete," Eddie Chung, Director with Airfreight in South China of Schenker International, told China Daily.

He also pointed out that Schenker International would not move part of its business in Hong Kong to Baiyun Airport.

However, Baiyun Airport sometimes can share business in the case where the airport in Hong Kong has an overflow of orders.

"In this year and next, we intend to handle 20 million tons of cargo in Baiyun Airport, accounting five percent of the airport's total handling capacity," Huang Yongzhong said.

Both Schenker International and BAX Global are based in Germany, and belong to Deutsche Bahn AG.

The two companies will merge their branches on the mainland in December this year.

So far, Schenker International ranks second in the global air-cargo logistics market.

(HK Edition 07/26/2007 page6)