From the Asia for Educators teaching unit, China's Geography:
Since China's major rivers — the Huang He (Yellow River) and Chang Jiang (Yangzi or Yangtze River)— flow from west to east, and there is no natural communication north to south except by way of a coastal route, the Chinese dug the Grand Canal as a safe, inland water route between the two major rivers, in the process connecting a number of minor regional rivers.
Constructed around 605 AD to serve commercial as well as military considerations, the canal was extended several times, most notably to the Hangzhou in 610 and eventually in 1279 to Dadu, the great Mongol (Yuan dynasty) capital. During the Ming and Qing dynasties, which followed the Mongol dynasty, the Grand Canal ensured that Beijing, the great successor imperial capital to Dadu, had sufficient grain from the southern rice bowl areas.
The Grand Canal is the longest artificial waterway in the world and has a long history of barge traffic along its course. Although many parts of it fell into disrepair over the years, today it is still possible to traverse the manmade Grand Canal from Hangzhou, Zhejiang Province, northward 1,801 km to Beijing.
WEBSITES FOR BACKGROUND ABOUT THE HISTORY OF THE GRAND CANAL:
ADDITIONAL READING: Arteries of Empire [Asia for Educators] This reading for students discusses China's hydraulic (water control) system and important improvements over time in canal transport. The reading can be used to enlarge the discussion of the Grand Canal and China's use of waterways.