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UPS keen to cash in on possible China-Australia FTA


Tuesday August 30, 2005

By Alia McMullen

SYDNEY, Aug 30 Asia Pulse - The president of United Parcel Service (UPS) said today a free trade agreement (FTA) between Australia and China could deliver the logistics giant a similar surge in business that followed the signing of the Australia-US FTA in May last year.

The president of the world’s largest package delivery company, David Abney, told journalists here today the company was hopeful Australia and China would proceed with an FTA.

"We’ve seen what happened when Australia and the US signed a free trade agreement ... and we believe that this increased trade can occur between Australia and China with this FTA."

Abney, on a short visit to Australia, said UPS is adding two flights between Australia and the US as a result of the increase in trade.

The US-based company, which serves more than 40 countries across the Asia Pacific, is gearing up for a boost to its operations across the region.

The president of UPS Asia Pacific Ken Torok said the company’s main area of growth was in China, which saw revenue jump 99 per cent on-year in the second quarter.

He said UPS’s growth in China was partly driven by an extension of its operations to cover complete supply chain solutions across three main areas - the movement of goods, the movement of information, and funding.

"Before UPS was focused just on small package, but now we offer our customers complete supply chain solutions."

Some of these solutions include areas such as warehouse management, technical repairs and customs management.

Torok said another factor driving business in China was that UPS was the only wholly-owned integrator in the country.

In December last year, UPS signed an agreement with its Chinese partner Sinotrans to take direct control of its international express operations in China’s largest and most important cities by the end of 2005.

The US$100 million deal gained UPS business operations in 23 cities across China, which service an additional 200 cities.

The new business centres strategically place UPS throughout China’s three main growth areas - Bohai Bay, the Yangzi River and Po River Delta - which account for 85 per cent of China’s international trade, Torok said.

He said the company was very optimistic that its business will continue to grow in China and it continues to add new services in the country.

In July, UPS added a domestic express product to its portfolio in China to serve the local market.

"It’s really not an option for us - it’s essential."

To further promote its expansion in the Chinese market, UPS last month announced it had been selected as the Official Logistics and Express Delivery Sponsor of the Beijing 2008 Olympic Games.

Under the agreement UPS will provide logistics consultation and management to The Beijing Organizing Committee for the Games of the XXIX Olympiad (BOCOG), and assist BOCOG to develop and execute the logistics operating plan for the Beijing 2008 Olympic Games.

The company will also provide express delivery services to venues during the Games.


 source: Asia Pulse