Monday, November 8, 2010

Rethinking High Speed Rail in China

The Financial Times reports that the ambitious Chinese high speed rail initiatives are undergoing scrutiny from the Ministry of Railways. There are many concerns, including a lack of coordination with other transport modes, unsustainable debt used to finance the system, and a lack of riders on lines that have opened. (Known problems with the Chinese rail networks blogged here.) Local governments are causing concerns by arguing for an 80 percent expansion above the proposed network. The Chinese stimulus of 2008 was also problematic as many projects were started without much consideration of how they complement other modes. Lastly, as these 70 percent of these rail lines are paid through debt, the ridership suggests that the loans will not be serviced through operating revenues alone.

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