China has inaugurated the Pinglu Canal in the Guangxi Zhuang Autonomous Region, establishing a new and shorter maritime route between southwest China and the sea, significantly enhancing its trade links with Southeast Asia. The canal, which cost approximately 72.7 billion yuan ($10.75 billion), spans 134.2 kilometers and connects Hengzhou to the Beibu Gulf, forming a critical part of the New International Land-Sea Trade Corridor.
The ambitious infrastructure project is engineered to accommodate vessels weighing up to 5,000 tonnes, and it reduces the traditional inland waterway distance to the sea by more than 560 kilometers through Guangdong ports. This strategic development is expected to slash logistics costs by 18% to 30%, translating into annual savings of over 5 billion yuan in transportation expenses.
Particularly beneficial for southwest China, the canal offers a more direct route for exporting goods such as coal, grain, minerals, new-energy materials, and automobile parts, addressing the historically higher transportation costs faced by businesses in the region. The route is anticipated to bolster economic ties between China and the Association of Southeast Asian Nations (ASEAN), with whom trade exceeded $1 trillion in 2025 and reached $744.41 billion in the first seven months of 2026.
To manage a water level difference of 65 meters, the canal is equipped with three navigation hubs featuring twin-line ship locks. Additionally, it incorporates water-recycling systems that are expected to conserve over 1 billion cubic meters of water annually. Environmental considerations were also integrated into the project, with more than 98% of the excavated materials being reused, and the inclusion of a fish passage and a wildlife crossing.
The opening of the Pinglu Canal is poised to attract further investment and promote supply-chain integration along its route. It is expected to enhance the movement of goods between southwest China and Southeast Asian markets, reinforcing China’s status as a pivotal trade partner within the region.