China Economic Review
Charting China’s changing economic terrain · Since 1990
Fast train track in China
August 20, 2009
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High-speed rail (HSR) can provide millions a cleaner, more efficient way to travel. Two ways of approaching it:In the United States, President Barack Obama allocated $13 billion to its development over the next five years. It is proposed, not started.In China, a $300 billion plan to create the world’s largest and most sophisticated high-speed rail network is already happening.
Barack Obama said, correctly, in July, “Railroads were always the pride of America, and stitched us together. Now Japan, China, all of Europe have high-speed rail systems that put ours to shame”.
And he is right. High-speed rail may be on its way to the United States but it’s already arrived in China.
China introduced a 270mph maglev train service in March 2004 and regular high-speed train services in April 2007.
Beijing will spend $50 billion on high-speed rail this year alone, and the central government plans to spend another $250 billion over the next decade.By 2020, China will have laid nearly 16,000 miles of high-speed track capable of carrying the fastest trains on the planet. By comparison, America has just 457 miles of high-speed track.
So far, the construction of the Beijing-Shanghai high-speed route alone has created about 110,000 jobs and is playing an enormous part in China’s economic recovery.
Spending on railways jumped 126.5% year-over-year in the first half of 2009, leading to a huge increase in the nation’s steel production at a time when global demand was decidedly weak.
China’s crude steel output in July reached a record 50.68 million metric tons, up 12.6% compared with last year, according to figures from the National Bureau of Statistics.
Money Morning reports that David Li, an economist at Beijing’s Tsinghua University, said there is no doubt that “the acceleration of the massive railroad build-out is playing a key role in China’s recovery.”