Ding Junfa, vice-chairman of the China Federation of Logistics and Purchasing, said: "A highly developed logistics industry will help a lot with China's goal to become a world factory."

A modern logistics industry was still at a fledgling stage in China where 10,000 companies are registered as logistics businesses, according to Ding.

Ding said that the main problems limiting development of logistics in China were a lack of business scale and backward concepts of operations in logistics.

In the meantime, the mounting cost of logistics, which accounts for about 20 percent of the country's gross domestic product, limited cargo transport speed, and substandard packaging could also be blamed for restricted development, said Dai Dingyi, head of China Logistics Information Center.

It was necessary to concentrate on establishing an efficient administrative system for modern supply chains in order to keep a competitive edge, otherwise Chinese manufacturers would lose customers, suggested Ding Junfa.

Nine Chinese universities are offering courses on logistics andtraining more professionals for modern logistics in China.

(Xinhua News Agency December 11, 2002)