China border town : gateway to cheap Vietnam resources
PINGXIANG - At a dusty border crossing on a remote section of the China-Vietnam border, Puzhai looks more like a railway crossing than an entry point into the world's most resource-ravenous economy.
Trucks ferrying every commodity imaginable -- rice, rubber, tapioca, coffee, coal and bauxite -- stream across the border into the world's fourth-largest economy. Motorcycles and machine parts rumble across in the other direction.
Puzhai is just a small border crossing but it heralds the future of trade in this region of China, which is bent on boosting a free flow of goods with its neighbors in Southeast Asia to keep raw materials flowing and its economy on track.
China needs all the raw materials it can get hold of to power an economy roaring ahead at more than 10 percent a year. And it's at the threadbare -- and unofficial -- Puzhai border that resource buyers save on import duties -- one way or the other.
"Things are getting busier and busier," said a man who gave his name only as Wei and has run a shop hawking Vietnamese wares at the border for the past decade.
Pointing to the trucks queuing amid the swirling dust of the deceptively low-key crossing, the vendor said: "Those are for minerals. Trucks for farm products look different."
The innocuous plot of dry, dusty land is fast becoming an import-export hub, heralding what the regional government of Guangxi wants on a larger scale, particularly when it completes a major free trade zone in the Beihai Bay.
Guangxi, the poor southern autonomous region left behind by the country's economic growth, hopes to cash in on a free trade agreement between China and the Association of Southeast Asia Nations.
"The autonomous region enjoys every advantage for closer economic cooperation and trade ties with Southeast Asian countries," Li Wenjie, deputy director-general of Guagxi's commerce department, told the China Daily newspaper.
ASEAN trade
The region -- which is roughly the size of Britain and has depended on its sugar cane production -- plans to import more energy and mineral resources from ASEAN members, while raising exports of finished products.
Official data showed Guangxi's trade with ASEAN members rose 50 percent in 2006 to about $1.82 billion from 2005. ASEAN members were also the second most important foreign investor in Guangxi after Hong Kong.
An official with the Puzhai trade administration, who declined to be identified, told Reuters the border trade totaled 3 billion yuan (US$400 million) last year, with farm products and minerals accounting for most of the business.
Not bad for a tiny border town about 200 km west of Guangxi's capital Nanning.
There are no armed guards, just two ramshackle huts on either side of a long metallic bar. No-one inspected cargo rumbling across on trucks, carts or even human backs.
Chinese and Vietnamese people cross the line freely with identity cards issued by local authorities.
Ironically, Puzhai is just a few kilometers away from the official Pingxiang border -- known as the Friendship Pass.
During the Vietnam War, Pingxiang was known as a portal for arms as the Nanning-Hanoi railway runs through the city.
Local officials said Chinese firms export most of their motorbikes through the border. About half of Chinese-made machinery and automobile parts destined for Vietnam also go through the crossing.
In the other direction, imports of iron ore and magnesium to China had risen sharply over past years.
Puzhai parking lot was choc-a-bloc with lorries ready to carry resources across into China. A road link is under construction that would connect the border town with a newly built highway to Nanning.
"I come here very often," said one taxi driver from Nanning. "Many want to start business here."
($1=7.777 Yuan)
By Nao Nakanishi & Niu Shuping - Reuters - February 14, 2007.
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