China has inaugurated the Pinglu Canal in the Guangxi Zhuang Autonomous Region, enhancing maritime access between southwest China and the sea, thus bolstering trade with Southeast Asia. The 134.2-kilometer canal, which connects Hengzhou to the Beibu Gulf, is a crucial part of the New International Land-Sea Trade Corridor. This strategic waterway aims to facilitate economic connections with ASEAN markets and beyond.
Constructed at an estimated cost of 72.7 billion yuan ($10.75 billion), the canal is engineered to accommodate vessels weighing up to 5,000 tonnes. It significantly shortens the traditional inland route to the sea by over 560 kilometers, previously routed through Guangdong ports. The new canal is projected to decrease logistics costs by 18% to 30%, potentially saving more than 5 billion yuan annually in transportation expenses.
The Pinglu Canal is particularly advantageous for businesses in southwest China, which have historically faced elevated costs for transporting goods to coastal ports. Key exports such as coal, grain, minerals, new-energy materials, and automobile parts can now reach international markets more efficiently. This development is expected to foster increased investment and supply-chain integration along the route.
In addition to its economic implications, the canal incorporates significant environmental measures. More than 98% of the earth and rock excavated during construction were reused, and the canal includes a fish passage and a wildlife crossing. The infrastructure also features three navigation hubs equipped with twin-line ship locks to manage a 65-meter water level difference, with water-recycling systems designed to save over 1 billion cubic meters of water annually.
This new waterway is anticipated to fortify China’s economic ties with ASEAN, its largest trading partner. In 2025, trade between China and ASEAN exceeded $1 trillion, with transactions totaling $744.41 billion in the first seven months of 2026. The canal is poised to enhance the movement of goods between southwest China and Southeast Asian markets, promoting stronger economic links in the region.