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446 Posts
Two express railway lines start construction near Sino-Korea border

Rough translation:

The foundation-stone laying ceremony was held for Shenyang to Dandong Railway Passenger Dedicated Line and Dandong to Dalian Express Railway on March 17.

The total investment of these two railway lines exceeding CN¥50 billion, making Dandong, the largest border city in China, an important transport hub in northeast Asia. Perhaps the wish of drink miso soup in Pyongyang in the morning, eat duck in Beijing at noon can be met by taking train in near future.

Wang Zhanzhu, the secretary of Shenyang Railway Bureau, spoke at the ceremony, the total length of Shenyang–Dandong PDL is 207 km, designed speed 250 km/h, planned construction duration is 4 years. The total length of Dandong–Dalian Express Railway is 295.9 km, designed speed 200 km/h, planned construction duration is 3.5 years.

Once Shenyang-Dandong PDL opened, it will take only one hour from Dandong to Shenyang, cut by 2.5 hours. Once Dandong-Dalian Railway opened, the eastern Northeast China railways will form a railway corridor, Dandong port will become the nearest seaport from eastern Northeast China.

Dandong, the city located aside Yalu River in southeast Liaoning province. North Korea is on the opposite side across the river. It is the closest city with North Korea in economy and trade. 70 percent cross-border trade between China and North Korea enter North Korea from here. Most tourists to North Korea are also enter North Korea by train from Dandong port.

A high-speed railway will also be built between Beijing and Shenyang according to plan. It is expected to be started in July this year. Besides these two railway lines, China and North Korea also signed an agreement on February 25, to construct a new road bridge across Yalu River.


新华网沈阳3月17日电(记者 徐扬)沈阳至丹东铁路客运专线、丹东至大连快速铁路,17日上午在此间举行了开工奠基仪式。


沈阳铁路局局长王占柱在仪式上说,沈阳至丹东客运专线全长207公里,设计时速250公里,计划工期4年。丹东至大连快速铁路全线长295.9公里 ,设计时速200公里,工期为3年半。






932 Posts
Officials rules out imminent start on E China maglev

Updated: 2010-03-16

HANGZHOU - Officials in east China's Zhejiang Province have ruled out this year for starting construction of a maglev train service between the provincial capital, Hangzhou, and Shanghai. A statement from the provincial development and reform commission Tuesday said the project had no timetable and was still undergoing feasibility studies.

Media this week reported construction was expected to start this year. The commission statement said project proposal was approved by the National Development and Reform Commission in 2006. The planned ultra-high-speed maglev line, with an estimated total cost of 22 billion yuan (3.22 billion US dollars), will be approximately 200 km long. It would shorten travel time between Shanghai and Hangzhou to half an hour from the current 2 to 2.5 hours.

China already has one 32-km maglev line operating connecting Shanghai's Pudong New Area with Shanghai Pudong Airport.

446 Posts

Tracklaying complete on Shanghai-Nanjing Intercity Railway

Length: 300.209 km (31 stations)
Maximum in-service speed: 300 km/h
Construction start: July 1, 2008
Tracklaying complete: March 17, 2010
Trial run start: May 1, 2010
Open for service: July 1, 2010

446 Posts
Construction work of three railway lines started on March 17

Qingdao-Rongcheng Intercity Railway
* Length: 299 km
* Max. speed: 250 km/h
* Cut travel time of Qingdao-Yantai from 3.7 hours to 1 hour
* Cut travel time of Qingdao-Weihai from 4.3 hours to 1.5 hours

Haitian-Qingdao Railway
* Length: 90.3 km

Linyi-Linshu Railway
* Length: 20 km

Construction work of Qingdao North Railway Station started
Platforms: 8
Tracks: 18
Open in 2012

3,120 Posts
a press official has no political power nor authority of any kind. The person raising the concern, according to the article, does have such authority.
Regardless of authority it doesn't change the facts. Otherwise it would be the fallacy of appealing to authority.

You simply miss the point - and with what self-confidence! To begin with, you cannot have arrived at the data unless you have concrete information about the designs of rolling stocks in China. Second, part of the point of the news article is that there is a political awareness of the issue.
No, you miss the point, and with what self-confidence.

To beign with it is absoultely possible to derive the change in energy consumption for a given speed, that is precisely what mechanics (as in the branch of maths) is for.

Using a combination of the tractive effort curve, and models of rolling resistence, air resistance and air friction, one can easily derive an approximation of energy consumption to speed. Any first year maths major or physics major will be able to do a rough calculation for you on a napkin. They will create a formula that will predict approximately ratio of energy consumption change, all that would be needed would be plugging in the precise details about the motors and the traction package's efficiencies.

Fortunately China does not live in a separate universe where the rules of physics are different.

Unless you seriously believe that the increase in consumption by a factor of 2 between 250 and 350km/h is an exact, precise and rigorously tested practical measurement?


Its a back of the fag packet calculation using a little bit of basic mechanics.

Is the madness catching up with you too, and itching to shout over other people instead of trying to read and respond calmly without projecting your own emotions into everything? I don't know what chip you are talking about. I am doing my best to tamper the madness here, bubbling over in all directions.
F%*@ you Miss Daisy. Hows that?

You are now on ignore.

932 Posts
New port to boost Inner Mongolia's coal output

Updated: 2010-03-18

SHENYANG - The landlocked coal-rich Inner Mongolia autonomous region in north China will soon have an open access to ship its coal from a port in its neighboring province to fuel-thirsty customers in eastern and southern regions. A port terminal to be built in Huludao, Liaoning province, will support an annual throughput of 50 million tons of coal when the first phase of the project becomes operational by 2012, Zhao Rongqing, the chief of port affairs in Huludao, said on Wednesday. The annual throughput would be eventually expanded to 230 million tons, Zhao said. He said a 300-km railway will be built to link the port directly with Xilingol, a major coal production base in Inner Mongolia autonomous region.

Inner Mongolia is China's coal heartland. Its verified coal deposit of 732 billion tons is much greater than the 250 billion tons in Shanxi province, which is currently China's biggest producer of the fossil fuel. The region's coal output has been quickly catching up, reaching 600 million tons last year, compared with 615 million tons in Shanxi. However, transport bottlenecks have been hindering Inner Mongolia from sending the resource to end users in coastal and southern regions, where coal-fired electricity plants suffer severe fuel shortages every year, especially in winter and summer. "The landlocked northern region has 60 percent of the country's coal reserve. However, southern and coastal regions consume 70 percent of the country's electricity. Current road and railway transport for coal cannot meet the demand," said Zhao Yonghua, deputy mayor of Ulanqab, Inner Mongolia. He said the traffic problem in the region was so serious that Inner Mongolia in January introduced an odd-even license plate policy for cargo trucks to ease traffic congestion .

Shipping the coal by sea is expected to get some of trucks off the road. "I was too excited to sleep when I heard the port plan," said Wang De, deputy head of the economic commission in Xilingol. He said the prefecture with a verified coal reserve of 150 billion tons of coal would see its output of coal reach 100 million tons this year and 350 million tons by 2015. The port will offer a "fast lane" to distribute the resource, Wang said.


2,252 Posts
I come up with this article:

Research Report on the Investment in Chinese Railway Transport Industry, 2009

WWW.SHCRI.COM - Research Report on the Investment in Chinese Railway Transport Industry, 2009


PR Log (Press Release) – Apr 08, 2009 – "Description
In 2008, Chinese daily departure train volumes were 144,868, up by 3.1% over the last year. The national daily departure train volumes were 120.445, increased by 2.3%. The cargo transportation volumes and turnover volumes by Chinese railways reached to 3.29 billion tons and 2.4828 trillion ton-kilometers, up by 4.5% and 3.7% respectively. The national railways finished 2.74 billion tons and 2.3375 trillion ton-kilometers, up by 3.7% and 3.5% respectively. The passenger volumes transported by the national railways were 1.456 billion man-times, up by 10.6% over the last year. The passenger turnover volumes were 772.8 billion man-kilometers, up by 7.1%. the passenger transportation volumes and turnover volumes by the national railways were 1.44 billion man-time and 768.8 man-kilometers, up by 10.6% and 7% respectively.

In order to cope with the international financial crisis, Chinese government issued a series of expanding domestic demand policies from the end of 2008, consisting of the 4-trillion-Yuan (570 billion USD) investment plan. Among the investments, the railway constructions occupied the important part. It was planned to finish 600 billion Yuan investments in 2008.

Propelled by the investment plans and policies, the investments in Chinese railway transport industry were increased fast in 2008. The investments in the railway transport industry had finished 414.4 billion Yuan (59.2 billion USD) in the whole year, up by 60% over the previous year. In 2008, the newly started railway projects totaled 596, down by 308 of the last year, but the average scale of the new projects reached to 787 million Yuan (112.4 million USD), increased by 475 million Yuan (679 million USD) compared with 2007.

By the end of the first quarter 2009, the approved investment amounts had exceeded 2 trillion Yuan (292 billion USD), including more than 1.2-trillion-Yuan (175 billion USD) investment in the process projects. It is clearly showed from Medium and Long Term Railway Network Plans (adjusted in 2008) that China will newly construct 40-thousand-kilometer railways with the total investment breaking through 5 trillion Yuan (730 billion USD) from 2009 to 2012.

In accordance with the plans of Ministry of Railways, the newly approved railway construction projects will be about 70 in 2009 in China with the total investment scale to 1.5 trillion Yuan (219 billion USD). It is predicted that the railway locomotive purchase expenses will reach to 150 billion Yuan (21.9 billion USD), which will be roughly the same in 2010.

Taking JING-HU railway express with the total estimated investments of 220 billion Yuan (32.1 billion USD) for example, at present, the construction involves more than 120 thousand workers and 24 thousand construction machinery. With the project advancement, the demands for the work force and machinery will also be increased. It is predicted the investments in JING-HU railway express construction will reach to 60 billion Yuan (8.76 billion USD) in 2009 and create demands for 2 million tons steel products and 12 million tons cements.

From the monthly growth investments in the basic railway constructions, the growth speed had been fast YOY increased by 100% for successive 8 months since July 2008, even exceeding 200% in February 2009. it is predicted that the investments in the railway infrastructure construction will be YOY up by about 80%. In next few years, the sub-sectors of Chinese railway construction industry will also keep growing.

Chinese passenger turnover volumes, cargo transportation volumes, the converted volumes and the transportation density all stand the first place in the world and finishes one fourth converted turnover volumes of the worlds’ railways through 6% of the world’s railway operation mileages.

The domestic and international enterprises related to the railway fixed infrastructure construction industry, the railway equipment manufacture industry and the railway transport industry will be benefited from Chinese railway construction.

In all, there are promising investment perspectives for the railway transport industry. Although it takes a long period to invest in the railway transports, the whole return is high with low ventures, increasing investment opportunities for the railway construction industry and the equipment manufacture.

The statistics in this report are from the authoritative institutions, such as the statistical departments and the industry associations. Meanwhile, the research center made profound investigations by interviewing the professionals and obtained abundant first-hand information. It is of high reference values to master the present situation and development trends of Chinese railway transport industry and discover the investment opportunities in Chinese railway transport industry and its related industries.

More following information can be obtained in this report:
- Present Development Situation of Chinese Railway Transport Industry
- Value Chains of Chinese Railway Transport Industry
- Investment Opportunities in Chinese Railway Construction Industry
- Influences of International Financial Crisis on Chinese Railway Transport Industry
- Demands of Chinese Railway Equipments, 2009-2010
- Construction Machinery Demands from Chinese Railway Construction Industry "
I thought China was planing to spend 300 billion dolars but apprently I was wrong plan is investing more than 700 billion $.

446 Posts
Construction work of Zhangjiakou-Tangshan Railway started

Construction work of Zhangjiakou-Tangshan Railway started

Length: 525 km
Investment: CN¥40.001 billion
Freight capacity: 200 million tons per year
Passenger capacity: 10 trains daily from each direction
Open in 2014

446 Posts
Test run on Chengdu-Dujiangyan Railway

Chengdu-Dujiangyan Railway
* Length: 65.5 km
* Max. speed: 200 km/h
* Investment: ¥13.3 billion
* Construction started: 2008-11-10
* Construction completed: 2010-01-26
* Expected to be put into service in May 2010

446 Posts
Construction work of Chengdu-Chongqing PDL started today

Construction work of Chengdu-Chongqing PDL started today

March 22, 2010

Chengdu-Chongqing Passenger Dedicated Railway
* Length: 308 km (66% on bridges or in tunnels)
* 12 stations
* Maximum speed: 350 km/h
* Total investment: CN¥43 billion
* Expected to open in 2014

225 Posts
High-speed rail to link Chengdu and Chongqing

A high-speed railway linking Chengdu and Chongqing will be built in the first half of 2010, local authorities in Chongqing announced Thursday, China News Service's website reported.

"Once the railway opens, it will take only 56 minutes to travel by train between the two cities," said Wen Tianping, spokesman of Chongqing municipality government, at a news conference.

According to Wen, the 305-kilometer-long high speed railway is a passenger dedicated line and there will be ten stations along the whole route. The project is expected to be finished within 4 to 5 years.

Wen said the railway will be co-invested by the Ministry of Railway, Sichuan province and Chongqing municipality. Another local newspaper Chongqing Economic Times also reported Thursday the estimated investment is 39.89 billion yuan ($5.85 billion).

The maximum designed speed of the railway is 350km/h, the top standard in China's high speed railway network. Currently, only the Beijing-Tianjin and Wuhan-Guangzhou high speed rails are capable of handling 350km/h trains. The Zhengzhou-Xi'an line could also reach such a high speed and is expected to open soon.

Chengdu, the capital of Sichuan Province, and Chongqing municipality are both major cities in China's southwest and the planned high speed railway linking them is expected to boost the economic development of the region.

Currently, it takes about 2 hours to travel between the two cities using the fasted train in operation.

China has an ambitious plan to develop its high speed railway network. The authorities said in 2009 that there will be 42 high speed railway lines in China by 2012. Eight high speed lines have been put into operation with the total mileage of 2,830 kilometers, the longest in the world.

225 Posts
Beijing-Shenyang high-speed rail to start construction in Jul

Mar. 23, 2010 (China Knowledge) - China’s high-speed railway line connecting Beijing and Shenyang, the capital of Northeast China’s Liaoning Province, may start construction in July, according to sources.

The Beijing-Shenyang Railway will be the second high-speed railway connecting northeastern China and northern China. Trains on the high-speed railway will travel at speeds of up to 350 kilometers per hour, shortening the trip between Beijing and Shenyang from nearly 4 hours to 2.5 hours.

The largest transportation infrastructure project in northeastern China, the Harbin-Dalian high-speed passenger railway project, will start operation in 2011. The project began construction in August 2007. The railway is expected to shorten the trip between Shenyang and Dalian from 3 hours to 1 hour.

The high-speed railway between Beijing and Shanghai will start operation this year, a year ahead of schedule, China Knowledge reported earlier. It will shorten the travel time between Beijing and Shanghai from 10 hours to 4 hours.

225 Posts
China gathers speed in railway projects


by Jamil Anderlini

For decades the high-speed railway sector has been dominated by a handful of companies in Europe, Japan and North America that have mostly focused on their own regional markets. But now, just as the industry witnesses a proliferation of high-speed rail projects across the globe, the rapid rise of Chinese state-owned rail producers is posing a serious threat to the dominance of companies such as Germany’s Siemens, France’s Alstom, Canada’s Bombardier and Japan’s Kawasaki.

“Chinese companies are changing the landscape of the global railway market because of the dimensions of their home market and because they are becoming involved in international tenders, which is new,” says Dominique Pouliquen, Asia-Pacific managing director for Alstom. While Chinese companies are new to the global stage and lag their European rivals in terms of quality and technology, they have some significant advantages.

“Price is their number one competitive advantage and they are very well organised, with financing support from Chinese state-owned banks,” Pouliquen says. “They offer a global package which is usually combining technical solutions with financing so it is very easy for governments to make a decision to use their products.”

The Chinese Ministry of Railways, which directly owns many of the country’s rail companies, co-ordinates tenders so they do not bid against each other. It also encourages foreign companies to join Chinese consortiums by holding out the prospect of greater access to the enormous Chinese market.

Analysts say Chinese companies are already very active in bidding for projects in the Middle East and Latin America. They are also targeting projects in Australia and the US and have already made significant inroads in their own region, with contracts in Thailand and Hong Kong.

The rise of a Chinese rail industry with global aspirations has happened virtually overnight. Iain Carmichael, managing director of consultants Lloyd’s Register Rail (Asia), says that as recently as three years ago Chinese companies did not have the know-how for many parts of their own rail systems, such as signalling and high-speed technology.

“But as the Chinese gained the know-how, the relationship changed, so now the Chinese have the upper hand and the Europeans have to work co-operatively if they want to compete.” The main constraint on Chinese exports of rolling stock is capacity, as Chinese producers try to keep up with orders at home in what is now the largest market in the world. “Some big manufacturers are tripling their output this year and we’re seeing a vast expansion of metro systems as well as high speed rail,” Carmichael says.

China’s market for rail equipment, including trains, components and equipment such as signalling systems, is expected to quintuple from an average of $10bn a year between 2004 and 2008 to more than $50bn between 2009 and 2013, according to McKinsey. This year, China is expected to account for more than half of the total global expenditure on rail equipment. The government plans to build at least 30,000km of new railway, most of it high speed, over the next five years and China is expected soon to overtake Russia to have the second-largest rail infrastructure in the world after the US.

Norway, China
128 Posts
From Financial Times
China Railway wins $4.8bn Indonesia deal
By Jamil Anderlini in Beijing and Anthony Deutsch in Jakarta
Published: March 25 2010 19:37 | Last updated: March 25 2010 19:37

China Railway Group has won a $4.8bn contract to build and operate an Indonesian coal railway, the latest in a string of offshore contracts for China’s state-controlled rail companies.

They have been winning rail projects across the world, including in the Middle East, Southeast Asia, Latin America, Africa and Australia. Chinese companies have also been snapping up global coal assets for the country’s power stations.

The deal is also further evidence that the once-frosty ties between East Asia’s two largest nations are now rapidly warming. It comes just weeks before Wen Jiabao, the Chinese premier, is scheduled to make his first visit to Indonesia.

China Railway, listed in both Hong Kong and Shanghai but majority owned by the state, said on Thursday it won the 24-year contract to design, build and manage the railway in South Sumatra for Indonesia’s Bukit Asam Transpacific Railway Corporation.

China Railway owns 10 per cent of Bukit Asam Transpacific Railway. Privately-owned Transpacific Group owns 80 per cent and Indonesian coal mining giant Bukit Asam owns the rest.

Beijing has made the transfer of sophisticated technology a prerequisite for international rail companies trying to enter the huge Chinese market and in the process, Chinese companies have rapidly become technologically competitive while offering much lower prices than their global rivals.

State-owned Chinese financial institutions usually offer favourable financing terms for projects such as the coal transport line in South Sumatra, making Chinese bids even more attractive.

China Railway announced on Monday a “strategic co-operation” agreement with state-owned Agricultural Bank of China to fund the railway. The bank will provide up to Rmb110bn ($16bn, €12bn, £11bn) in financing over the next three years to support China Railway projects, including its overseas contracts and projects related to exploiting natural resources.

Bukit Asam said it and its partners were in talks with four Chinese lenders to finance 70 per cent of the railway and the rest will be financed internally.

In spite of a history of turbulent bilateral relations, Chinese investment in Indonesia has in recent years significantly outstripped traditional sources such as the US.

Indonesia is the world’s largest exporter of thermal coal. Last year 15 per cent of its coal exports went to China.

Norway, China
128 Posts
All articles from
High-speed rail spells doom for Xian air link
Reuters in Beijing
4:44pm, Mar 26, 2010

A new high-speed rail link between two mainland cities has cut travel times so dramatically that all competing air services on the route have been suspended, state media said.
The suspension of flights between the gritty industrial city of Zhengzhou and Xian, home of the Terracotta Warriors, came just 48 days after the express railway began operations, the official Xinhua news agency said on Friday.
The 505km railway, on which trains run at a top speed of 350 km/h, has cut the travel time between the two cities from more than six hours to less than two, the report said. By contrast, flying takes just over an hour. Xian’s airport is also located at least an hour away by road from downtown.

Before the railway opened, Joy Air, one of the domestic airlines flying the route, managed to sell an average of more than 60 per cent of seats for the route, Xinhua said.

Zhengzhou airport confirmed that all flights to and from Xian had now stopped, the report added.

Mainland is spending billions of dollars on a network of high-speed railways, including one from Beijing to the country’s financial capital Shanghai, posing a challenge to airlines which had profited from mainland’s vast size and slow roads and trains.

By 2012, the country would have more than 13,000 km of high-speed railway, Xinhua said.

“By then, 60 per cent of China’s domestic air market will be affected by the high-speed railways,” Liu Chaoyong, general manager of China Eastern Airlines (SEHK: 0670), was quoted as saying.

China Eastern last year agreed to sell 35 per cent of Joy Air, in which it held 40 per cent, to state-owned Aviation Industry Corp of China.
Costs and political sensitivities hit hopes of a pan-Asia rail link
Toh Han Shih in Beijing
Mar 22, 2010

Prospective Malaysian and Thai partners in a Chinese-built high-speed rail network linking the mainland with Southeast Asia say prohibitive costs and political sensitivities could delay the plan for a decade.
"High-speed trains may happen in Malaysia in 10 to 15 years, but not in two to three years. The main problem is high-speed rail is too expensive as new rail lines need to be laid," said Afzar Zakariya, a senior manager at Keretapi Tanah Melayu (KTM), the Malaysian state railway.

Zakariya was speaking on the sidelines of the China Modern Rail Summit in Beijing last week.

At an earlier railway conference in Beijing, a senior Thai railway official said that Chinese companies had been trying to persuade the Thai government to adopt high-speed railways supplied by China, but he was advising against the plan.

High-speed rail links were too expensive for Thailand, given the state of its economy, the official said, adding that political sensitivities over the location of rail links from southern China through Southeast Asian nations such as Myanmar and Vietnam, would require careful negotiation.

Another KTM official, Ismail Said, said mainland firms may be invited to join upgrading projects on existing lines and train stations in Malaysia, but not high-speed systems.

China has proposed a high-speed link from Kunming, in Yunnan province, to Singapore via Thailand and Malaysia, and is involved in technical negotiations on this issue, it has been reported.

State-owned firms such as China Railway Group (SEHK: 0390) and CNR Tangshan Railway Vehicle were in negotiations with parties in Malaysia over various railway projects, including a high-speed network, CNR sales chief Wang Dianwu said

But Wang declined to comment on a Malaysian newspaper report that CNR was in talks to build a rail link between Georgetown on Penang island with Butterworth.

In November last year, around the time of President Hu Jintao's visit to Malaysia, the Malaysian government announced it would award a US$2.1 billion railway project in southern Malaysia to a Chinese consortium including China Railway Engineering Corporation, the state-owned parent of China Railway Group, a Hong Kong and Shanghai-listed railway construction firm.

But China Railway Group now appears to be facing possible delays in its planned Malaysian projects.

On March 9, when former Malaysian finance minister Daim Zainuddin met the group's president Li Changjin in Beijing, Li expressed to Daim his hope that both sides would implement their joint project as soon as possible, according to China Railway's website.

Daim replied that while the Malaysian government had signed a letter of intent on the project late last year, much work remained to be done by both sides.

With progress on the high-speed land network evidently stalled over price and political sensitivities, attention has returned to the idea of a 200km undersea high-speed rail link between Fujian province and Taiwan, which was first mooted earlier this month.

Zheng Jian, the chief planner at China's Ministry of Railways, confirmed that an undersea high-speed rail tunnel between Fujian and Taiwan was part of the government's long-term plans, and said authorities were conducting feasibility studies.

But the Mainland Affairs Council, Taiwan's top China policy co-ordinating body responded coolly to the comments, dismissing the idea as a unilateral proposal from Beijing and saying it was improper for the two sides to talk about such a huge project given the political situation across the Taiwan Strait.

However, speaking in Beijing last week, Sung Hung-kang, the chief of the train operation and maintenance section of the Taiwan Railways Administration, said the feasibility of the idea should be considered.

"Now there is no war between China and Taiwan. Relations between Taiwan and China are improving. As cross-straits ties get better, a high-speed rail link can be considered," said Sung.

Last year, the Taiwan government scrapped a law forbidding the sourcing of railway equipment from the mainland. Also last year, a Taiwanese railway delegation visited mainland railway officials in Shanghai to discuss cross-strait partnerships in rail technology and Taiwanese purchase of mainland-made railway components, said Sung.

The Taiwan Railways Administration is conducting a tender for 296 electric train cars, and mainland companies were welcome to bid for it, he said.
Private funds shun railway projects
Toh Han Shih
Mar 25, 2010

Private bankrolling of the mainland's ambitious railway construction plan has fallen far short of Beijing's wishes as investors shy away from the huge capital outlay required.
The government originally wanted 40 per cent of railway project financing to come from the private sector, but it is actually below 5 per cent, according to Chen Jing, a sales manager at Beijing Huaxinjie Investment Consulting (BHI), a Chinese state-controlled consultancy.

"Railways have been far less successful than expressways in getting foreign and private investment," Chen said. "Railway investment is very high, and return on investment is a consideration for investors."

Private investors baulked at backing the 1,069km Wuhan-Guangzhou high-speed railway, which costs 116.6 billion yuan (HK$132.55 billion). It started service in December last year and will connect with Hong Kong's future high-speed railway by 2016. The project tried to get both private and foreign investment but failed, Chen said.

In 2004, a mainland company was formed to obtain private financing for railway projects but was unsuccessful and was subsequently acquired by the Ministry of Railways, he added.

As a result, the country's massive rail spending is being financed by debt and investment from the central government, local governments and the ministry.

China plans to dislodge the United States as having the world's most extensive railway network by 2020, with 120,000km of track. Planned investment in railway construction is 823.5 billion yuan this year, and for the 12th Five-Year Plan from 2011 to 2015, the budget is three trillion yuan, according to BHI.

"To make money from railways has always been a challenge around the world," said Paul Ng, a partner at law firm Stephenson Harwood. "Few, if any, rail projects make money. With a ticket costing two yuan, the Beijing metro will never make money. How do you attract investors to a project like that?"

The global financial crisis also has stymied foreign funding of the railway projects. "The number of banks active in big-ticket funding has massively decreased in the last couple of years," said Graeme McLellan, a partner at Stephenson Harwood.

Premier Wen Jiabao recently stated a preference for more spending on social causes instead of transport infrastructure projects, said Wendy Liu, the head of China research at RBS. "This means railway spending growth will moderate on the margin. We are likely to see strong competition for funding in 2010 among various infrastructure projects and regular enterprise borrowers."
Chinese infrastructure firms' deals top US$5b
Toh Han Shih
Mar 26, 2010

Chinese infrastructure construction firms have recently won more than US$5 billion in contracts for Indonesia and Macau.
China Railway Group (SEHK: 0390) won a US$4.8 billion contract to build and operate a rail coal freight network in Indonesia, equivalent to 13.96 per cent of the company's turnover in 2008, the state-owned firm announced on the Shanghai Stock Exchange yesterday.

On March 23 in Beijing, the Shanghai and Hong Kong-listed company signed the US$4.8 billion contract with Bhakta Hill Pan Pacific Railway Corporation, consisting of a US$1.3 billion project to build the railway within 1,460 days and a US$3.5 billion yuan contract to operate it for 20 years.

Given the long-term nature of the project, the contract would not have any significant effect on China Railway's results this year, the company said. "The contract's risks are mainly in financing, currency exchange rate and operations," China Railway said.

The financing risk arises from the project's dependence on Bhakta Hill's ability to raise funds, while the foreign exchange risk arises from the fact that 65 per cent of the consideration is in US dollars, China Railway said.

The operational risk is because project revenue depends on how much coal is transported, China Railway said. Recently, a subsidiary of China Communications Construction (SEHK: 1800) (CCC), a state-owned port construction firm, and China National Electric Equipment Corporation signed in Beijing a US$64.41 million contract to build a port for the Tanjung Awar-Awar electric power station in Java in Indonesia, CCC said.

The port will facilitate the supply of raw material to the power station. The construction period is 20 months.

CCC said last week that West Java governor Ahman Heryawan welcomed the company's increased participation in infrastructure projects in the Indonesia province. Heryawan said CCC had established itself as one of the leading engineering contractors in Indonesia.

The Indonesian government plans to see infrastructure spending of US$140 billion in the next five years to lift annual GDP growth to 7 per cent, including US$90 billion that it hoped would come from the private sector, Agence France-Presse quoted the Indonesian Investment Co-ordinating Board chairman Gita Wirjawan as saying.

Last week, CCC won a 1.58 billion pataca contract to expand a port in Cotai in Macau, CCC said. The Macau project involves a passenger terminal, with 16 berths for boats carrying 400 passengers, and three berths for boats carrying 1,200 passengers, as well as helicopter pads. The construction period is 1,088 days.
2261 - 2280 of 6648 Posts