Poland Designated as Home to New BRI East European Logistics Hub

An AliExpress logistics center set to be built close to country's German border as the demand for e-commerce rises generally.

Poland will accommodate the new AliExpress logistics centre which will be a major addition to the e-commerce industry. The logistics centre will improve the experience of online shoppers in neighbouring countries such as Germany and the Czech Republic. The new center will operate as a joint venture between the Alibaba Group, the Shanghai-headquartered Logistics Group (WWL) and the ATC Cargo, a multi modal Polish freight delivery company.

This move is planned to increase the reach of the AliExpress in the eastern and central Europe. However, Allegro the biggest player in Poland’s e-commerce market is known to control a major part of the market in the host country. The Chinese platform has made significant efforts to increase its market share while reaching a wider audience. In October 2017, a survey conducted by PayU, the Dutch fintech company, AliExpress was chosen by 62% of the online shoppers in Poland when they were asked to choose the e-commerce market leaders.

Poland has also emerged as the favorite choice for a host country to accommodate the new center due to its strategic geographical advantage about the objectives of the Belt and Road Initiative (BRI), in China, there is an ambitious international infrastructural development and trade facilitation programme. The investment in Poland will facilitate a primary land conduit between China and the large markets in Europe especially in Germany where the customer base is estimated to be 81 million. Considering the country's geographical advantages, Amazon has already started making plans to launch its USD 876 million logistics facility in Szczecin, a city located in north-west Poland close to the German border.

For the first time, the AliExpress will provide its goods for sale in the host country. The goods will be available in smaller batches rather than the previous supplies of a container load of goods to the region. The investment will also provide a way to manage the increasing traffic between China and Poland which involved the delivery of over 500,000 parcels as reported in 2017, which was a 200% increase from the value recorded the previous year.