Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/109160 
Authors: 
Year of Publication: 
2013
Series/Report no.: 
International Transport Forum Discussion Paper No. 2013-28
Publisher: 
Organisation for Economic Co-operation and Development (OECD), International Transport Forum, Paris
Abstract: 
China has suffered railway capacity constraints for more than several decades and the need for a large increase in rail capacity has been viewed as the primary challenge. The former Chinese Ministry of Railways believed that building a national wide high speed railway (HSR) network was the most efficient solution to China's rail capacity problems. By 2012, 9000 km of HSR line has been completed which accounted more than half of the total in the World and the other 9000 km HSR line is either under construction or in the planning stage. This paper attempts to discuss the initial operational, financial and economic result of such a large scale HSR investment in China where the establishment of an appraisal system for a HSR project is still underway and the public data in need are not available. Based on some trial studies carried out on several HSR projects, however, the paper shows that except for a limited amount of HSR projects in the most developed areas of the country, the initial financial and economic performance of most HSR lines are generally much poorer than expected. The scale of investment seems to be difficult to justify, given that investment in HSR lines is very expensive, especially for those with design speed of 350 km/h, and the high level of debt funding. Moreover the values of time of the ordinary Chinese are still low by European standards. For a developing country planning HSR projects, one lesson that can be learnt from China is that it would be ideal if a comprehensive appraisal can be taken into account before investing in HSR. Such appraisal includes examination of different options for technical and operational standards, timing of investment, construction scale and pace, train operational scheme and service level, pricing and regional development policy (political consideration). At the very least, a step by step development strategy should be adopted to cope with the huge uncertainties and risks.
Document Type: 
Working Paper

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