Beijing, China – China is opening its first modern river-to-sea canal for navigation on Wednesday, a project that aims to dramatically cut down shipping distances between the country’s southern hinterland and Southeast Asia, a region that serves as a critical trade partner. The Pinglu Canal is located entirely in Guangxi, the region in China’s far south bordering Vietnam and overlooking the South China Sea. This 134km (83-mile) waterway links the Xijiang River with the Beibu Gulf, the northwestern arm of the Gulf of Tonkin stretching between southern China and northern Vietnam.
It gives vast areas of southwest China, including provinces such as Yunnan and Guizhou, a shorter route to the sea and to Asian markets. The first such canal built by communist China, Pinglu is a part of the New International Land-Sea Trade Corridor: A project involving southern Chinese provinces aimed at linking areas in western and southwestern China with Southeast Asian countries and global markets. The land-sea trade corridor is itself a part of Chinese President Xi Jinping’s Belt and Road Initiative, a web of highways, ports and railroads seeking to connect China with Europe and Africa.
According to local authorities in Guangxi, the canal will shorten the shipping distance between inland areas of southwest China and Southeast Asian countries by about 560km (350 miles) and reduce logistics costs by 18 to 30 percent. Estimates by Zhang Zhiwen, deputy secretary-general of the Guangxi government, indicate that transport costs alone will come down by more than 5 billion yuan annually, or about $700m. The region’s vice chairwoman, Lu Xinning, describes these returns as “tangible gains” that reduce operating costs and boost domestic and foreign trade.
The canal will allow the passage of ships with a capacity of 5,000 tonnes. Its estimated cost is about 72.7 billion yuan, equivalent to about $10.8bn. This means cities and industrial areas far from the coast in southwest China will become closer to maritime trade routes.
The new trade corridor does not serve Guangxi alone; it is connected to a broader network extending to Chongqing in southwest China, Chengdu in Sichuan province, Guizhou and Yunnan, before goods reach the ports of the Beibu Gulf and, from there, overseas markets. These changes come at a time when trade between China and Southeast Asia is growing rapidly. According to China’s General Administration of Customs, bilateral trade in the first half of 2026 reached about 4.34 trillion yuan, or about $640bn, an increase of 18.2 percent year on year.
At the southern end of the canal, container-handling capacity at Beibu Gulf Port rose from 2.28 million TEUs in 2017 to 10.06 million TEUs in 2025, with a shipping network covering major Southeast Asian ports. Guangxi is also working to build what it calls the “Pinglu Canal Economic Belt”, with the aim of attracting industries and spreading them out along the new corridor, while linking them to ports, transport networks and supply chains. The targeted sectors include non-ferrous metals and critical minerals, modern green chemicals, as well as artificial intelligence and information technology.
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