China Railway Construction Speeding Up, Boosting Inland Economic Growth

China Railway Construction Speeding Up, Boosting Inland Economic Growth

Date:8/21/2009 12:00:00 AM

HONG KONG, Aug. 20 /-Asia/ -- On Aug. 19th, the 12th session of
Guangdong-Hong Kong collaboration meeting revealed that the
Hong Kong-Shenzhen-Guangzhou Express Railway will be put into construction
late this year. According to data released by the Ministry of Railway of the
P.R.C. on early August, a total of RMB 281.708 billion has been invested into
railway construction in the first 7 months this year, up 110.60% year-on-year;
railway infrastructure investment totaled RMB 247.494 billion, up 136%
year-on-year; July railway investment totaled RMB 49.745 billion, up 66.16%
year-on-year; July railway infrastructure investment totaled RMB 46.038
billion, up 77.55% year-on-year. These data have demonstrated the buoyancy of
railway construction in China.

On Aug. 10th, Deputy Director of the Ministry of Railway of the P.R.C.,
Wang Zhiguo, noted that China's railway construction investment plan for the
next three years has been settled, with the average annual investments total
value above RMB 700 billion.

The large sums of money will be channeled into two key areas: one is the
Western Railway Network construction project, which includes building new
railway lines and upgrading existing railway lines; the other is the Express
Railway construction, which focuses on main arteries in the East.

Fairtheworld.com points out that a large proportion of China's 4 trillion
Yuan stimulus package is devoted to railway construction. With this stimulus
package gradually taking effect, the railway construction's role in boosting
the economy will be more and more manifested. Apart from directly driving
domestic demand, and bolstering associated industries, it will help to create
leapfrog opportunities for regional economies.

For China's Eastern coastal area, which has been hit hard by the financial
crisis, infrastructure constructions will definitely jumpstart its economy.
Moreover, the Express Railway construction will make regional markets more
closely linked, having great implications on logistics, trade, tourism and
other industries. On the other hand, the Western region, with its strong cost
advantages, is becoming a preferred place for industrial drift. More and more
enterprises are moving from coastal areas to the Sichuan Basin, for example.
Meanwhile, the rapidly developing West is attracting more and more skilled
workers, and these high-quality workers in turn are bringing high-tech
industries along with them. It is against this backdrop that the improvement
of the Western Railway Network is exceptionally pivotal. A sound transport
environment is a pre-requisite and catalyst for any economic growth, and the
railway, as the engine of development, may become a launching pad for the
Western economy.


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