16-Jun-07
China railways to catch up with other BRIC economies.

Shanghai, June 16, 2007 – China represents 24% of the world's total freight traffic and 22% of global population. Its rail system however, accounts for about 14% of total cargo transport and 6% of the world's total railroad length, according to new research by business intelligence consultancy Fusion Consulting in Shanghai.

This situation is set change, as the government address key challenges:

1. Many areas in Western China such as Sichuan, Qinghai and Tibet are inaccessible by railway.
2. Northeastern China is the country’s important food and energy production base. During the peak season, the average daily demand for carriages in Heilongjiang for example, reaches 16,000 carriages. Yet the current capacity is only 1,800 carriages.
3. In some places, there is a lack of on-the-ground connections from train wagon to ships or trucks. For example, Tongjiang port in Heilongjiang is not directly connected by railway. Freight needs to be transported by truck or river barge from the port to the Siberia Railway in order to reach Russia.
4. The maximum running speed of trains in some places is as low as 120 km/hour, much slower than international standards.

From 2006 to 2010, RMB1,200 billion will be invested in railway construction, effectively increasing the total length of China’s railways by 20% to 90,000 km. This includes rail projects for Beijing-Shanghai, Beijing-Guangzhou-Shenzhen, Harbin-Dalian, Zhengzhou-Xi’an, Shanghai-Ningbo-Shenzhen and Nanjing-Wuhan. It also includes city-to-city rail rapid transit lines for Beijing-Tianjin, Shanghai-Nanjing, Shanghai-Hangzhou, Nanjing-Hangzhou and Guangzhou-Zhuhai. This is a massive undertaking given China’s varying terrain, provincial governments and economic zones.

The government is also planning to break up the state-owned railway network, currently controlled by the Ministry of Railways, into at least five companies based on geography.

It is good news that China’s railways are being geared up to meet China’s cargo and passenger needs. Mr. Loh Chun How, Dalian Branch Manager at APL, a global logistics company, who was interviewed by Fusion Consulting said, “The rail network, which is currently choked with coal, military supplies, food grain and commodities, as well as passenger traffic, will then have more capacity to carry freight. This will open up more inland opportunities and in turn, port traffic.”

About Fusion Consulting
Fusion Consulting is a business intelligence consultancy providing clear strategic advice on Asia-Pacific markets. With offices in Singapore, Shanghai and Hong Kong and a network of 400 industry-specialist consultants in 16 countries, the company conducts custom research and consulting to help companies understand their markets, compete more effectively and grow into new areas of opportunity.

For more information, please contact Fusion Consulting at

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