By |盘古智库
I. Introduction
In 2014, the盘古智库 innovatively proposed the "Tianyuan Strategy," which aims to construct a new inland economic development axis with cities such as Chongqing, Chengdu, Xi'an, Zhengzhou, Wuhan, and Changsha, thereby forming a strategic support point for high-quality economic development in China. The盘古智库 has been deeply involved in industrial research and policy discussions in regions such as Xi'an, Wuhan, Changsha, Chengyu, and Central Plains over more than ten years, aiming to promote the transition of this strategy from theoretical construction to practical consensus. Facing the new development pattern, on May 2025, the public report titled "Building the Great Hinterland of China and Creating the Main Platform for Domestic Circulation" released by the盘古智库 New Age of Navigation Public Welfare Research Group further proposed the "Great Hinterland of China" strategy. This strategy aims to explore the core engine role of the inland economic depth space in the national dual circulation system through studying the integration of resources in the great hinterland, providing references for planning during the "Fifteenth Five-Year Plan" period. The "Great Hinterland of China" strategy highlights the strategic hub functions of cities such as Chongqing, Chengdu, Xi'an, Zhengzhou, Wuhan, and Changsha, linking the Yangtze River Economic Belt, the Western Land-Sea New Passage, and the "Belt and Road" core areas, building an economic space of ten provinces including Sichuan, Chongqing, Shaanxi, Shanxi, Henan, Hubei, Hunan, Yunnan, Guizhou, and Guangxi, and reshaping the regional economic geography pattern to offset external uncertainties and cultivate new growth poles.
This article is one of the series reports on "Building the Great Hinterland of China." Against the backdrop of economic globalization and regional cooperation, transportation infrastructure plays a key role in shaping the national economic pattern and enhancing regional competitiveness. Water transport, as an ancient yet uniquely advantageous mode of transportation, still occupies an important position in the modern logistics system. With diverse terrain and abundant water systems, China can build a more complete inland waterway network and create a "Great Hinterland of China" with strong economic radiating power and development potential by vigorously constructing inland canals, injecting new momentum into sustainable economic development. This report will delve into the significance of constructing inland canals for creating the "Great Hinterland of China," the current status of inland canal construction, the challenges faced, and development strategies and recommendations.
II. The Significant Meaning of Inland Canal Construction
(I) Lowering Logistics Costs and Adapting to the New Normal of Cost Competition
Water transport has significant advantages such as large capacity, low cost, low energy consumption, and less pollution. It is estimated that the unit cost of water transport is only 50%-60% of railway and 12%-15% of road transport. By connecting originally independent water systems through the construction of inland canals, a traffic artery with low cost and large capacity can be reconstructed. This allows enterprises in inland areas to significantly reduce logistics costs when transporting raw materials and products, improving the market competitiveness of their products, and thus attracting more industries to gather in inland areas. Meanwhile, the construction of inland canals can consolidate the advantage of logistics costs. During the past stage of rapid economic growth, enterprises had relatively ample profit margins and were less sensitive to transportation costs, with roads and railways widely used due to their timeliness, while air transport mainly served high-value or urgent goods. However, "cost reduction and efficiency enhancement" has become the core demand for enterprise survival and development. Due to its unparalleled cost advantage, water transport has always been the first choice for bulk goods. The construction of inland canals is a key measure to extend the logic of low-cost water transport to the inland hinterland. It provides powerful cost support for enterprises in inland areas by constructing low-cost, large-capacity inland water transport channels, becoming an important tool for continuously optimizing the regional business environment and enhancing the overall economic resilience of the "Great Hinterland of China."
(II) Leveraging Investment Pulling Effects and Stabilizing Growth Expectations
Inland canal projects often have prominent features such as large investment scale, long construction cycles, and strong chain driving effects. Single projects' investments often reach hundreds of billions, and some even reach the trillion-level. Under the macro background of promoting sustained economic recovery and expansion of domestic demand, scientifically planning and orderly advancing inland canal construction is an important way to implement effective investment and stabilize growth expectations. Such major infrastructure projects not only directly drive related industries such as engineering construction, equipment manufacturing, and raw material supply, creating a large number of jobs, but also significantly enhance the long-term development potential and attractiveness of the hinterland economy by improving the regional infrastructure network, laying a solid foundation for economic growth over the next few decades. Therefore, actively and prudently advancing inland canal construction is a strategic move to play the key role of investment and serve the national stable growth situation.
(III) Strengthening Regional Connections and Promoting Balanced Regional Economic Development
1. Strengthening Regional Connections: The construction of inland canals breaks down geographical barriers between regions, making trade between inland and coastal areas, as well as different inland regions, more convenient. For example, after the Pinglu Canal is completed, the distance for Guangxi goods to reach the sea will be shortened by more than 560 kilometers. Southwest region's goods no longer need to detour through the Pearl River Delta and can directly access the sea from the main channel of the Xijiang River, greatly activating the growth pole of Beibu Gulf and strengthening economic ties between southwestern regions and coastal areas.
2. Promoting Industrial Transfer and Upgrading: Low-cost water transport channels are conducive to attracting industries from the eastern coastal areas to transfer to inland regions, promoting the industrialization process in inland areas. At the same time, it also provides opportunities for upgrading industries in inland areas. Enterprises can use convenient water transport conditions to introduce advanced technologies and equipment, developing high-end manufacturing and modern services, achieving optimization and upgrading of industrial structures.
(IV) Optimizing Water Resource Allocation and Ensuring Ecological Livelihood
The construction of inland canals can achieve reasonable allocation of water resources between different water systems, improving the uneven distribution of regional water resources. For example, the Jianghuai Canal project not only connects the Yangtze and Huai rivers, forming a high-grade waterway circle of "Yangtze River - Jianghuai Canal - Huai River," but also achieves the allocation of water resources from the Yangtze River Basin to the Huai River Basin, providing precious water resources for northern Anhui and eastern Henan, ensuring irrigation needs for agriculture, urban water supply, and ecological water use.
(V) Assisting in Building a Comprehensive Three-dimensional Transportation Network and Enhancing Comprehensive Efficiency
Inland waterway transport is an important part of a comprehensive three-dimensional transportation network. The construction of inland canals can complement and organically connect with existing railway, highway, and aviation transport modes, forming a more efficient and convenient integrated transport system. Different transport modes can achieve seamless transshipment and intermodal transport of goods, improving transport efficiency, reducing logistics costs, and meeting various levels of transport needs.
III. Analysis of the Current Status of Inland Canal Construction in China
(I) Completed Canals and Their Achievements
1. Beijing-Hangzhou Grand Canal: The Beijing-Hangzhou Grand Canal is the longest and largest ancient canal in the world, one of the oldest canals, and a symbol of China's cultural status. The Grand Canal starts in Yuhang (today's Hangzhou) and ends in Zhuo County (today's Beijing), passing through four provinces: Zhejiang, Jiangsu, Shandong, Hebei, and two municipalities: Tianjin and Beijing. It connects the five major water systems: Haihe River, Yellow River, Huaihe River, Yangtze River, and Qiantang River, with Weishan Lake as the main water source. The total length of the Grand Canal is approximately 1794 kilometers. The annual freight volume of the Jiangsu section of the Beijing-Hangzhou Grand Canal exceeds 500 million tons, which is eight times the annual freight volume of the Jinghu Expressway. In recent years, with the rectification of the waterways and upgrades to expand capacity, the throughput of ports along the Beijing-Hangzhou Grand Canal has continued to grow. In 2023, ports along the Beijing-Hangzhou Grand Canal completed a cargo throughput of 750 million tons, representing a year-on-year increase of 9.6%, ranking second only to the Yangtze River and Pearl River water systems, fully demonstrating the strong resilience and vigorous vitality of inland waterway transport. The canal has played a huge role in economic, cultural development, and exchanges between the north and south regions of China, particularly in the development of industry and agriculture along the route.
2. Jianghuai Canal: Fully navigable in 2023, it connects the Huai River, Chaohu Lake, and the Yangtze River, transforming the original "two-character" shape of the Huai River and Yangtze River routes into a "work-character" shape, changing the current situation where Huai River and Yangtze River water transport must detour via the Beijing-Hangzhou Grand Canal, shortening the transportation route by 200 to 600 kilometers. It is estimated that annually, more than 6 billion yuan in freight costs for bulk goods can be saved, and logistics costs for industrial enterprises along the route can be reduced by 5% to 10%. By 2030 and 2040, the total waterway transport volume of the Jianghuai Canal is expected to reach 138 million tons and 185 million tons, respectively.
3. Jianghan Canal: To mitigate the impact of the South-to-North Water Diversion Middle Route Project on the middle and lower reaches of the Han River, the state completed and opened the Jianghan Canal (formerly known as the Jianghan Water Diversion Project) in 2014. The project diverts water from the Yangtze River at Jingzhou, Hubei Province, and injects it into the Han River at Qianjiang, with a total length of 67.23 kilometers, built to the standard of a third-class waterway (navigable for vessels up to 1,000 tons). The core functions of the project include: annually replenishing the Han River with 3.7 billion cubic meters of water, ensuring irrigation for 6.45 million mu of farmland downstream and safe water supply for 8.89 million people; forming a high-grade waterway circle of "Yangtze River - Jianghan Canal - Han River," significantly shortening the navigation distance from Jingzhou to Wuhan by 200 kilometers and from Jingzhou to Xiangyang by nearly 700 kilometers; and simultaneously improving the water ecological environment in areas such as Changhu Lake and Jingzhou City Moat. The Jianghan Canal has become an important link for connecting the Yangtze River and the Han River, optimizing regional water resource allocation, and enhancing the connectivity of the inland water network in the "Great Hinterland."
(II) Progress of Ongoing Canal Projects
The Pinglu Canal is under tight construction. As of April 20, 2025, the Pinglu Canal project has cumulatively completed an investment of 52.8 billion yuan, accounting for 72.6% of the total project investment, completing excavation of approximately 282 million cubic meters of earth and stone, accounting for 89.3% of the total excavation volume. According to plans, it will be completed and navigable by 2026, allowing passage for large ships up to 5,000 tons. This will make the export of goods from China's southwest region more convenient, shortening the maritime route by approximately 560 kilometers. It is expected that the annual reduction in transportation costs brought about by the diversion of existing channel freight volumes will exceed 5.2 billion yuan.
(III) Introduction to Planned Canal Projects
1. Xianggui Canal: Connecting Hunan and Guangxi, it is called the "modern Lingqu Canal." On February 1, 2025, Hunan Province released the "Xianggui Canal Pre-feasibility Research Report Compilation Bidding Announcement," marking the official start of preliminary research. Once completed, the Xianggui Canal will connect the Yangtze River and Pearl River water systems, opening a north-south water transport channel, achieving interconnectivity among 34 of the 36 main inland ports nationwide. After connecting with the Pinglu Canal to the south, it will effectively shorten the water transport mileage of goods from the upper and middle reaches of the Yangtze River to Beibu Gulf by approximately 1,200 kilometers.
2. Jinghan Canal: Connecting Jingzhou and Wuhan, equivalent to "cutting a bend" on the Yangtze River. In 2023, the project was written into the government work report of Hubei Province; during the 2024 National Two Sessions, the Hubei delegation proposed the suggestion to "accelerate the preliminary work for the Jinghan Canal." The project plans to utilize existing rivers from Songzi Mouth to Dongjing River Mouth, excavate new sections, forming a total length of 230 kilometers of a ten-thousand-ton-class waterway. It is estimated that if the canal is built, it will significantly shorten the water transport mileage of the Yangtze River, reducing sailing time by approximately 14 hours, effectively lowering logistics costs.
IV. Challenges Faced in the Construction of Inland Canals
(I) Engineering Technical Difficulties
1. Complex Terrain: Some canal construction areas have large topographical variations. For example, the Xianggui Canal crosses mountainous areas on the border of Hunan and Guangxi, requiring overcoming differences in elevation, setting up watersheds, etc., increasing the difficulty and complexity of engineering construction.
2. Geological Conditions: Geological conditions vary significantly across different regions, possibly involving soft soil foundations, fragmented rocks, etc., posing challenges to the foundation construction and long-term stability of the canals. Targeted engineering technology measures are required.
(II) Huge Financial Investment
The construction of inland canals belongs to large-scale infrastructure projects requiring massive financial investment. For instance, the budget for the Pinglu Canal project exceeds 72 billion yuan, and the Zhejiang-Guangdong-Yue Canal is expected to require significant investment. The main sources of funding rely on government fiscal input and bank loans, with relatively single financing channels and considerable financial pressure. Additionally, the long construction cycle of canals also means long return periods, making it necessary to address key issues regarding the continuous investment and rational use of funds.
(III) Ecological Environmental Protection Pressure
Canal construction may have certain impacts on the ecological environment along the route, such as altering river hydrological conditions, damaging wetland ecosystems, and affecting biodiversity. During the construction process, enhanced environmental protection and restoration are needed, adopting eco-friendly engineering designs and construction methods, while establishing a sound ecological monitoring and assessment system to ensure coordinated development between canal construction and environmental protection.
(IV) Difficulties in Cross-regional Coordination and Management
Many inland canal projects involve multiple provinces and regions, requiring cross-regional coordination and management in planning, construction, and operation. Differences in development goals, interests, and policies among different regions may lead to problems such as poor coordination and interest conflicts, affecting the overall progress of canal construction and operational efficiency.
V. Development Strategies and Recommendations for Inland Canal Construction
(I) Scientific Planning and Rational Layout
1. Consider regional development needs comprehensively: Combine with national regional development strategies and local socio-economic realities, taking into account factors such as industrial layout, resource distribution, and urban development, to scientifically plan the route, scale, and functional positioning of inland canals, ensuring alignment with regional development needs.
2. Strengthen connections with other modes of transport: Incorporate inland canal construction into the comprehensive three-dimensional transportation network planning, strengthen seamless integration with railway, highway, and aviation transport modes, reasonably plan port facilities and logistics parks, and achieve efficient intermodal transport among different modes of transport.
(II) Strengthen exploration and argumentation, and plan new inland canal systems in advance
Based on scientific assessment of existing water system conditions and development needs, it is necessary to plan strategically a batch of inland new canals with strategic significance to further densify the inland waterway network of the "Great Hinterland of China." Specific concepts and planning progress are as follows:
1. Yu-Qian-Guang Canal: As a key channel for inland areas to access the sea southward, the Yu-Qian-Guang Canal aims to open a new river-sea intermodal route connecting Chongqing, Guizhou, and the Beibu Gulf in Guangxi via the Wulong River and other water systems. If implemented, it will become a national strategic channel and a critical link for inland areas to access the sea southward, effectively aligning with the Guangdong-Hong Kong-Macao Greater Bay Area and the Chengdu-Chongqing Twin-City Economic Circle, integrating into the open pattern of internal and external linkage and mutual assistance between east and west. The project has drawn high attention from Chongqing, Guizhou, and Guangxi: in 2023, Chongqing proposed the initiative at the National Two Sessions, and in 2025, Guizhou included it in its preliminary research targets, hosting specialized academic seminars, striving to incorporate it into the national "Fifteenth Five-Year Plan." If constructed, goods from Chongqing can reach the sea via Guizhou, with the voyage potentially halved, significantly enhancing the effectiveness of the Western Land-Sea New Channel and expectedly alleviating some of the freight pressure on the Three Gorges Hub. Currently, the focus should be on overcoming complex geological and hydrological engineering challenges, deepening line scheme comparisons, and feasibility arguments.
2. Sichuan Central Canal System: By connecting Chengdu, Suining, Nanchong, Dazhou, and other key cities in Sichuan through three artificial waterways: Tuo-Fu Canal, Fu-Jia Canal, and Jia-Qu Canal, the internal east-west waterway connections within the basin are optimized, transforming the "U-shaped detour" into an approximate straight-line connection, enhancing regional logistics efficiency. Simultaneously, combining with water conservancy projects such as Pihe Diversion, considerations are made for both channel water depth assurance and regional water resource allocation, serving the development needs of central and northeastern Sichuan. Upon completion, this system will reshape the east-west logistics channels within the central Sichuan region, supporting internal collaboration within the Chengdu-Chongqing Twin-City Economic Circle.
3. Shaanxi Guanzhong Canal: Historically, Shaanxi once had a splendid tradition of water transport centered around the Han-Tang Canal (such as the Guangtong Canal connecting Xi'an and Tongguan). Constructing the Guanzhong Grand Canal carries the vision of reviving Shaanxi's water transport hub centered on Guanzhong. The project planning can include restoring the Guangtong Canal to connect Xi'an-Tongguan; extending the Wei River westward to connect Xi'an-Baoji; and connecting to Henan's inland waterways from Tongguan, potentially long-term connecting with the Yellow River water system. Modern planning needs to integrate historical heritage with ecological governance, but water resource security is the core challenge. In the face of extreme geographic obstacles like Mount Qinling, a pragmatic approach is currently advisable, prioritizing the rectification of relevant waterways, improving channel grades, perfecting water resource projects such as the Water Diversion from the Han River to the Wei River, optimizing water network connections, and simultaneously conducting forward-looking research on the feasibility of large-scale water transport networks.
4. Exploration of Henan-Hubei Canal Planning: Opening a new channel by connecting the Han River and Huai River water systems, forming a new channel running longitudinally through southern Henan and northern Hubei (or referred to as the Henan-Hubei Canal), is a modern continuation and southern extension of the historical concept of the "Yellow River-Han Canal" to connect the Yellow River and Han River. This holds significant meaning for connecting the waterway networks of the Yangtze River, Huai River, and Yellow River basins. If planned and implemented, it will form an important north-south waterway axis, constituting a "cross-shaped intersection" with the Yangtze-Han River golden waterway, greatly strengthening the linkage between the Central Plains Urban Agglomeration and the Yangtze River Midstream Urban Agglomeration, enhancing the radiation capability of the core hubs of the "Great Hinterland."
(III) Innovating Financing Models and Broadening Funding Channels
1. Increase Government Fiscal Support: The government should continue to increase fiscal investment in inland canal construction, establish special construction funds, and ensure the smooth progress of key projects. At the same time, optimize the efficiency of fiscal fund usage, strengthen fund supervision.
2. Attract Social Capital Participation: Actively promote the PPP (Public-Private Partnership) model, encouraging social capital to participate in inland canal construction through investment, shareholding, construction, and operation. Formulate reasonable return mechanisms and preferential policies to protect the legitimate rights and interests of social capital, enhancing the enthusiasm of social capital participation.
3. Explore Diversified Financing Channels: Besides fiscal investment and social capital, diversified financing channels such as issuing special bonds, asset securitization, and introducing international financial institution loans can be explored to broaden the funding channels for inland canal construction, alleviating financial pressure.
(IV) Strengthening Ecological Protection and Restoration
1. Establish Strict Ecological Protection Standards: Conduct comprehensive ecological environment assessments in the early stages of canal planning and construction, establish strict ecological protection standards and environmental impact assessment systems, clearly defining ecological protection goals and measures.
2. Adopt Eco-friendly Engineering Technologies: In the design and construction process, promote the application of eco-friendly engineering technologies such as ecological slopes, ecological retaining walls, and ecological dredging to minimize damage to the ecological environment. Strengthen environmental supervision during the construction process to ensure that all ecological protection measures are fully implemented.
3. Enhance Ecological Restoration and Compensation: For areas affected by canal construction, timely ecological restoration should be carried out to restore ecological functions. Establish an ecological compensation mechanism to provide reasonable compensation to areas and individuals affected by ecological impacts, safeguarding their legitimate rights and interests.
(V) Strengthen Cross-regional Coordination and Cooperation
1. Establish and improve cross-regional coordination mechanisms: Establish a cross-regional coordination leadership group led by national departments and involving participating provinces and regions to coordinate and resolve major issues in the construction and operation of inland canals. Establish regular communication and consultation systems to promptly address contradictions and problems arising in cross-regional cooperation.
2. Unify policies, regulations, and standard specifications: Formulate unified policies, regulations, technical standards, and specifications for canal construction and operation management to ensure consistency and coordination in canal construction and operation. Strengthen policy coordination and information sharing between different regions to create a favorable policy environment for cross-regional cooperation.
3. Promote Synergistic Regional Industrial Development: Taking the opportunity of inland canal construction, strengthen industrial collaborative cooperation along the route, guiding reasonable industrial layout and division of labor. Establish regional industrial cooperation parks to achieve resource sharing and complementary advantages, jointly promoting regional economic development.
VI. Conclusion
Massively constructing inland canals plays an irreplaceable role in creating the "Great Hinterland of China," being a key measure to enhance China's economic competitiveness, promote balanced regional development, optimize water resource allocation, and build a comprehensive three-dimensional transportation network. Although there are numerous challenges in terms of engineering technology, financial investment, ecological protection, and cross-regional coordination in the current construction of inland canals, these difficulties can be effectively overcome through scientific planning, innovative financing models, strengthened ecological protection, and enhanced cross-regional cooperation strategies, pushing inland canal construction to achieve greater progress. In the future, with the completion and operation of one inland canal after another, the development potential of the "Great Hinterland of China" will be fully unleashed, providing solid support for achieving high-quality economic development. We should seize the opportunity and actively promote the construction of inland canals to create a better future for China's development.
Original Source: https://www.toutiao.com/article/7517983856243556876/
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