China Opens Its Doors to Private Investment

China's railway network is overshadowed by its tremendous economic growth. In 2005, for example, the Chinese rail lines accounted for 6% of the global total, while its rail freight traffic accounted for 24% of the global total. Since the current Chinese rail network cannot meet demand, in the next five years China plans to construct 17,000 km of new rail lines, with total investment valued at $158 billion (US). Additional rail projects, with additional investment requirements, are planned after that. The Chinese Ministry of Railways contributed almost 90% of railway construction funds for decades, with the remainder coming from state-owned resources and local government. Foreign and domestic private investment was prohibited. Current demand is now opening the door to private investment. The author cites examples of early private investment in Chinese rail projects. Three challenges to private investment are also discussed: high investment threshold, inadequate laws and regulations, and fear of unfair competition due to ambiguity in responsibility.

Language

  • English

Media Info

  • Media Type: Print
  • Features: Photos;
  • Pagination: pp 25-26
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 01044319
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Mar 12 2007 3:39PM