The nature and characteristics of international cargo transportation

I. International Cargo Transport is an Invisible Form of International Trade

(I) Concept of International Cargo Transport

Transport, by its subject, is divided into cargo transport and passenger transport. Cargo transport can further be geographically categorized into domestic cargo transport and international cargo transport. International cargo transport refers to transportation between countries or between a country and a region. It can be further subdivided into the transport of international trade goods and non-trade goods (such as exhibits, personal luggage, office supplies, foreign aid materials, etc.). Since the transport of non-trade goods is often a peripheral service of trade goods transport departments, international cargo transport is commonly referred to as international trade transport. From a national perspective, it is called foreign trade transport, abbreviated as foreign transport.

(II) Nature of International Trade Transport

In international trade, the price of goods includes the freight cost, which constitutes a significant portion of the product's price, typically accounting for about 10%. For some goods, it can account for 30% to 40%. Like the production price of goods, the freight price fluctuates around its value due to changes in market supply and demand. The freight price enters the international market for exchange along with the physical form of the goods, and changes in freight prices directly affect the price changes of international trade goods. As the main subject of international cargo transport is international trade goods, it can be said that international cargo transport is itself a form of international trade. However, what is exchanged is not physical goods but a special commodity: the displacement of goods. What is called freight price is its exchange value.
From this, we can conclude that from a trade perspective, international cargo transport is an invisible form of international trade.

II. Characteristics of International Cargo Transport

International cargo transport involves transportation between countries or between a country and a region. Compared to domestic cargo transport, it has the following main characteristics:

(I) International cargo transport concerns international relations and is a highly policy-sensitive foreign-related activity.

International cargo transport is a component of international trade. During the organization of cargo transport, extensive direct or indirect business contacts with foreign entities are frequently required. These contacts are not only economic but often involve international political issues, making it a highly policy-sensitive foreign-related activity. Therefore, international cargo transport is both an economic activity and an important external affair. This requires us to handle various operations not only from an economic perspective but also with a policy mindset, conducting international transport business in accordance with China's foreign policy requirements.

(II) International cargo transport is long-distance transport involving many intermediate links.

International cargo transport involves transportation between countries or between a country and a region. Generally, the distances are quite long, often requiring the use of multiple modes of transport, several loading and unloading operations, and passing through many intermediate links such as transshipment or changes in transport modes, traversing different regions and countries, and adapting to various national regulations and provisions. If any one of these links encounters a problem, the entire transport process can be affected. This requires us to organize effectively, ensuring each link is closely connected, to avoid disruptions in any segment that could cause losses to the transport.

(III) International cargo transport involves a wide range of parties and complex, variable situations.

International cargo transport involves many domestic and foreign departments, requiring dealings with cargo owners from different countries and regions, transportation authorities, commodity inspection agencies, insurance companies, banks or other financial institutions, customs, ports, and various intermediary agents. At the same time, due to differences in laws, policies, and regulations across countries and regions, variations in trade and transport practices and operational methods, disparities in financial and monetary systems, as well as changes in political, economic, and natural conditions, can all significantly impact international cargo transport.

(IV) International cargo transport requires strong timeliness.

Timely shipment of import and export goods and prompt delivery to their destinations are of great significance for fulfilling import and export trade contracts, meeting the demands of competitive commodity markets, enhancing market competitiveness, and enabling timely settlement of foreign exchange. This is especially true for fresh goods, seasonal goods, and highly sensitive goods, which require swift transportation and timely supply organization to improve the competitiveness of exported goods and consolidate or expand the market. Therefore, international cargo transport must emphasize time awareness, striving to seize the moment and prioritize speed to gain an advantage.

(V) International cargo transport involves considerable risk.

Due to the numerous links, long transport distances, wide-ranging involvement, complex and variable situations, and strong timeliness, factors such as changes in the international political landscape along the transport route, social unrest, the occurrence of natural disasters and accidents, as well as war, blockades, embargoes, or piracy activities can directly or indirectly impact international cargo transport, potentially leading to serious consequences. Therefore, the risk associated with international cargo transport is relatively high. To transfer the risk of losses during transport, various import and export goods and transport vehicles require cargo transport insurance.