China’s growing cross-border e-commerce is now using TIR (Tansports Internationaux Routiers), a global transit system. TIR ships goods from one country to another, in sealed compartments and controlled by customs. Through a multilateral and mutually recognized system, goods are transported in a safe and efficient manner across borders. It also saves time and money for customs authorities.
What is the TIR transit system?
The TIR system is the international customs transit system with the widest geographical coverage.
The European Union is considered to be a single territory for the purposes of the TIR procedure. This means the EU can only use TIR for international movements. This includes the movement of goods either starting or ending in a third country.
How the TIR system saves e-commerce money
According to the European Union, the TIR can avoid paying any duties or taxes, making it more affordable for e-commerce to send goods across borders. “As other customs transit procedures, the TIR procedure enables goods to move under customs control across international borders without the payment of the duties and taxes that would normally be due at importation (or exportation).”
A condition of the TIR procedure is that the movement of the goods must include transport by road.
The International Road Transport Union(IRU), under the UN mandate, manages the TIR. It has 76 contracting parties around the globe. This way goods are shipped from one country, through transit countries, to another country of destination. This all happens via multilateral and mutually recognized systems.
According to the IRU, e-commerce using TIR saves money and time. It’s estimated to cut transport time by up to 80% and costs by up to 38%.
Why China uses TIR
China’s e-commerce trade heightened exponentially in 2020 during the COVID-19 pandemic, especially foreign trade. With TIR global transport, China’s e-commerce trade is likely to see another growth pattern.
According to China Daily, the import and export of China’s cross-border e-commerce increased nearly ten times in the last five years. This is why it’s focusing on foreign trade development.
The TIR could connect China with 30 countries. Hopefully this will push it even further into a higher e-commerce trade capacity.
E-commerce demand for TIR
According to GlobalData China’s e-commerce market is the largest in the world. It grew by 10.4% in 2022. The cross-border demand for online shopping is spiking continuously.
Wholesale marketplace Alibaba.com connects suppliers with over 40 million buyers from 190 countries every year. It’s China’s largest wholesale marketplace. News agency Alizila is reporting there is a huge demand for cross-border trade with Europe and the US. It also noticed a rapid growth in orders from Southeast Asia.
About the author
Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand.
