China Eastern Airlines, Singapore Airlines and others have agreed to combine cargo carriers at China’s largest air cargo port.

In addition to SIA and Pu Dong airport-based China Eastern, China Ocean Shipping Group as well as a unit of Eva Airways will take part in the joint effort. Together, they will create China Cargo Airlines via a combined investment of $2 billion, according to a statement in regards to China Eastern’s stock in the Hong Kong exchange.

The move will boost each company’s air cargo presence in Shanghai, which is the busiest hub in Mainland China in terms of air cargo. The service is aimed to commence before the start of the new year and will bring a major competitor for both Air China and Cathay Pacific Airlines cargo branches.

Kelvin Lau, an analyst from Daiwa Institute of Research in Hong Kong, said that the move comes as exports from China continue to thrive whilst imports have also become a major success. Lau noted that by creating a single carrier, all of the companies involved would cut management costs by having only one cargo operation to oversee instead of several.

At the end of the year, China is likely to become the second largest importer in the world in addition to being the world’s biggest exporter. According to the Chinese Minister of Commerce, Chen Deming, and the Xinhua News Agency, the country’s foreign trade in 2010 could total to $2.9 trillion.