Country Roads

Development in Transportation

1 Outline

 Transportation  Railroad  Highway  Civil aviation  Pedestrian facilities

 Trade

 Minerals  Rare earths

 Inter-province comparison

2 3 Gtoe: Gigatons of Oil Equivalent

4 Comparative Disadvantage of the Area

 Key factors affecting competitiveness  Proximity to sources of inputs (raw materials, labour, etc)  Transportation to markets

“Considering that market access has a significant international component, it is likely that, with further integration into the world economy, these inequalities will grow if access to new markets is not evenly distributed across the country.” Laura Hering and Sandra Poncet, “The Impact of Economic Geography on Wages,” Economic Review, 2009 #20.

 Example: Cost of transportation to  Imports: 10%; Exports: 14% of total cost  Integration of rail networks between China and its neighbours hindered by weak mutual trust and security concern 5 Rail bottleneck between China and

Ishim River Astana

Dzungarian Gate (阿拉山口)

Population 2/3 Kazakh 1/4 Russian

6 Railway Development

7 The “New Silk Road”

歐亞大陸橋

8 Eurasian Land Bridges

 Trans-Siberian Railway 西伯利亞鐵路 (1916)  From to , the Netherlands  Mainly through Russia  Concern about monopoly and domination by Russia

新歐亞大陸橋 (1990)  From to Rotterdam  Through west China, , Russia, to

9 Eurasian Land Bridges

 Trans-Asian Railway 泛亞鐵路 (under planning & part construction)  Initiative by UN Economic and Social Commission for Asia and the Pacific  Agreement signed in 2006 by 17 countries  Connecting existing rail systems with new links

 4 planned routes  Northern corridor: Mainly follows Trans-Siberian Railway  Southern corridor: through to southwest China  network: to Singapore  North-South corridor: Finland through Russia to Central Asia and

10 Existing Land Bridges

11 China’s own initiative of southern land bridge

12 China’s own initiative of southern land

Kashgar bridge

Islamabad

Karachi

13 Political Economy of Rail Systems

 Constraints on current and planned Eurasian Land Bridges

 Diverse rail systems (, signal, power, etc)  Historical (colonial) legacy  Technical debate over superiority of rail systems  Concern about national security  Technological concern: Reliance on foreign system and equipment

 Protectionism: Freight transit and handling charges

 Regional stability

14 Diverse Rail Systems

15 SiMinYi viaduct, JiTong Railway, near Jingpeng, Inner (by Schaffner)

Silk Road Region: The Passing-by?

Long distance rail primarily serves two ends of the Eurasian continent, i.e. east China and western Europe, and has less value for places and peoples in between

16 Railroads ‘Go West’: Integration by iron tracks 17 Railroads ‘Go West’: Integration by iron tracks

18 High Speed Rail (HSR): Accelerator of National Integration?

19 Initial Planning of HSR

 Concentrate on mega cities in east and central China  Only the “mid-west” was covered during early stage  World Bank's relatively modest expectations of HSR in China (especially of 's position in the future rail network)

20 HSR plan at its peak

21 China’s HSR “Go-out”

22 Chongqing: The new hub for international ?

23 Side Story: Rail plan across Taiwan Strait

Connecting London and Taipei by Eurasian Bridge?

24 Arguments AGAINST High Speed Rail (Zhou Jian)

 Long-term financial problems according to foreign experience  Construction cost too high  Unlikely to draw enough passengers to offset

 No significant improvement in rail congestion

 Upgrading freight rail systems between industrial centres more cost effective (experience of )

(趙堅，北京交通大學經濟管理學院教授) 25 Bare Viability of HSR

90

80

70

60

50 Column 1 40 Column 2

30

20

10

0 Taipei-Zuoging Beijng-Tianjin Seoul-

 Million passengers/year (actual)  Required number of passengers for economic viability Based on SCMP 18 Feb '11 p. B-10  Probably a ‘non-starter’ in the West

26 Scaling Back HSR

 2011: Minister of Railway Liu Zhijun (劉志軍) under investigation of alleged “severe violation of discipline” (corruption)

 HSR cut under Sheng Guangzu 盛光祖

 Reduced the speed of forthcoming HSR lines from 350km/hr to 300km/hr

 East-west lines: Only 4 go that fast

 Shorter lines: 200-250km/hr

 Possible considerations (not announced): Safety, pollution, energy

 Zhao Jian: Energy consumption of trains at 350 km/hr could be twice that of trains at 200 km/hr 27 Scaling Back HSR

 Projects in urgent demand continued for economic development

 Others projects might be curtailed

 Xi’an to Urumqi route

 Original plan : 350 km/hr

 Sheng's plan : 200 km/hr

 NY-Washington, DC : 240 km/hr (compare)

28 Post-2011 adjustment to the HSR plan

29 Lowering Sights for Railroads in General

 Sheng: A few projects will be rolled out between 2011 and 2015 across the country with an investment of RMB2.8 trillion

 Railway network

 Present: 91 000 km

 End 2015: 120 000 km (People’s Daily, 13 April 2011)

 2010: Railway investment plateaued

 8% of infrastructure spending

 3% of overall fixed asset investment

 Trend of declining

spending Jonathan Fenby

30 Highway / Expressway

31  NW the leader

 SW lagged behind

 Why?

(North) (+Tibet) 32 Expressways Highways

Expressways/Highways in West China, 1999-2008 (acc to tech levels)

(North) (+Tibet) 33 Emphasis on ROAD in many eastern PLJs Emphasis on RAIL in many western PLJs

34 ROAD – fairly evenly distributed per capita except for Ningxia and Tibet RAIL – disproportionately more in Inner Mongolia, , Qinghai and Tibet

35 Overall size of freight traffic through highways in some western PLJs has been increasing during GOW

(Source: Deutsche Bank Research, 2013) 36  Different approaches according to John A. Donaldson

: Super highways connecting Kunming to borders and other provincial capitals

 Guizhou : Rural roads to reduce isolation of mountainous areas

 Xinjiang : Not in his study but determined to have it both ways

Road Construction

37 Xinjiang International Transport

 Border 8 countries

 Mainly rely on road transport

 International rail through Dzungarian Gate (阿拉山口)

 International flights in operation

38 阿黑土別克

Xinjiang Road built International 2002 Transport

39 40 Karakoram Highway Der Spiegel 1 July 2012 (linking Xinjiang and ) Karakoram Highway in Pakistan (from Xinjiang)

41 Nick Frisch File photo from Dawn, Karachi, 15 August 2011 “If you are building a ball field, they will come” New expressway crossing Yellow River in central Ningxia

National

If PLJ debt is included, China’s debt (48%-90% of GDP) may be roughly equivalent to US debt (87% of GDP) (FT 12 Aug 2011)

JDS 2009 42 Financing Transportation Projects of GOW

 Railroads mainly financed by bonds

 SOEs usually as ultimate creditors

 RMB3T owed for high speed rail (how to paid off?)

 Railroads in the West usually expensive  Distance, landscape, geology, etc  Least financially viable  Chongqing underground rail line  Qinghai-Tibet railway  Xi’an-Nanjing railway

43 Bank Financing and the Issue of Returns

 Road projects financed by bank loans

 Low rate and long period of return

 Local governments responsible for construction and operating costs of own section

 Lower traffic flow due to distance between cities and low population density

 Construction not solely for economic consideration

Sectional toll gates as commonly found along highways in China Gansu, July 2013 44 Urban Transport in West China

 Motor vehicles as prime means

 Traffic management can’t catch up with rapid growth in number of vehicles

 Development of metro system

Common scene: Non-moving two-way traffic in , July, 2013

45 46 Issue of Priorities: Development vs Livelihood

Cost Items (RMB billion)

Accessible clean water 2.8 for 13m rural people

Chongqing urban mass- 3.3 transit railway, phase one 47 Automobile Boom in China (11.5 million sold in 2011)

 Sale of electric / hybrid cars still at low level  Only 5 679 BYD electrics sold in 2011 (hybrids: 2 580)  ‘Non-starters’ in West China 48 Scott Kennedy blog Jan 2012 Civil Aviation

49 Air Transport in West China

 Rail and highway (bus, truck/lorry)  Well suited to the flat, compact East  Expensive in the sprawling, often mountainous West

 Air transportation as solution to the West?  Operating costs  Environmental costs

50 Air transport in West China less extensive than the East in general (not comprehensive, 51 for general picture only) Air network in Xinjiang started developing much earlier than other PLJs

52 Potential for aviation industry in West China due to its strategic location

53 Freight Energy Efficiency

Air pollution

 Best: Slow boats nd  2 : Truck (130 tonne-miles per gallon) rd  3 : Normal rail (400 tonne-miles per gallon)

 Worst: Airplanes CO2 emission by air freight

 4 times those for lorries/trucks

 38 times rail (best option for west China / Central Asia)

 48.5 times ocean container shipping (best)

 But for most hauls, the highway is still king

54 55 Political Economy of Pedestrian Facilities

56 Whom do transportation “improvements” benefit?

Guiyang vs Taipei

Common Scene I Decommissioned pedestrian crossing

57 Harold Lasswell's classic question – Politics: Who Gets What, When and How?

Common Scene II Pedestrian given little consideration in road planning (Urumqi)

58 Guiyang

Common Scene III Automobiles occupying pedestrian space, coupled with loose law enforcement (Guiyang)

59 Does it work?

Common Scene IV Weak sense of civil obedience

60 Common Scene V Public facilities installed on pedestrian paths (Chongqing)

JDS 2011 61 Pedestrian Street at Jiefangbei (解放碑), Chongqing From ‘liberation’- to marketization…

62 Transportation- and West China  From street to sky, there are a lot issues for us to consider in respect of the subtle relationships between the ruling and the ruled  Who are the real beneficiaries of infrastructural development?  Would development in transportation accelerate assimilation and dependence of West China on the East (core) region?  Are national integration and locality mutually exclusive? and more…

Urumqi, September 2009 (two months after riots)…

Pedestrian street in minority areas: Does it make any difference? 63 Tina Wichmann