China's high-speed rail construction "reduced throttle"

  China News Weekly reporter/Zhao Yiwei

  Issued in the 992th issue of China News Weekly on 2021.4.19

  After more than 10 years of investment and construction boom, China's high-speed rail construction has begun to "reduce the throttle".

  On March 29, the State Council forwarded the "Opinions on Further Improving Railway Planning and Construction" jointly issued by the National Development and Reform Commission, the Ministry of Communications, the National Railway Administration and the China National Railway Group (hereinafter referred to as China Railway Group). Referred to as "Opinions").

The "Opinions" proposed that the construction of parallel lines of existing high-speed rails will be strictly controlled, and the construction of subways and light rails in disguised form in the name of newly built intercity railways and urban (suburban) railways is strictly prohibited. At the same time, the construction threshold for 350km/h high-speed rail projects will be clarified.

  This is the first time in recent years that decision-makers have put forward restrictive requirements on the construction of high-speed railways, which means that China's high-speed railway projects have been tightened from approval to construction.

Have a clue

  The policy wind has already begun to take shape last year.

National railways have maintained an annual investment of about 800 billion yuan since 2014, and more than half of the newly built railways are high-speed railways.

The government work report of the two sessions in 2020 proposed "increase railway construction capital by 100 billion yuan." The industry had predicted that railway investment in 2020 would exceed 800 billion yuan, but last year's railway fixed investment was finally completed at 781.9 billion yuan.

  By the beginning of 2021, the Ministry of Transport and the China National Railway Group were even more uncharacteristic, and neither issued a clear target for the amount of railway investment plans.

On March 18, the Ministry of Transport stated that it is expected that in the next 15 years, the average railway mileage put into operation every five years will be about 18,000 kilometers, which is lower than the current level.

  In fact, the actual production and construction of China's high-speed railways has been too advanced, and the problem of imbalance between high-speed railways and ordinary railways is particularly prominent.

  According to the "13th Five-Year Plan" and the "Medium and Long-term Railway Network Plan" released in 2016, by 2020, the national railway operating mileage should reach 150,000 kilometers, including 30,000 kilometers of high-speed railways; and the scale of the railway network will reach 175,000 kilometers by 2025. , Including 38,000 kilometers of high-speed railways.

But in fact, the national high-speed railway operating mileage has reached 37,900 kilometers in 2020, and the mission goal was completed five years ahead of schedule.

However, in 2020, the national railway operating mileage will only reach 146,400 kilometers, and the actual completion amount is still 3,700 kilometers away from the planned target.

  Wang Ming, director of the Comprehensive Transportation Research Institute of the National Development and Reform Commission, said in an interview with China News Weekly that the high-speed railway exceeded the expected target, and the reason for the failure of the general-speed railway to achieve the expected target is that the local area is generally keen on high-speed railway construction. And ignore the development of general-speed railway.

He said that at the beginning of the 14th Five-Year Plan for Comprehensive Transportation Development, the state issued the "Opinions" to correct local understanding of railway construction and "avoid competing or disguisedly incorporating railway projects into national plans."

  "The release of the "Opinions" this time does not mean that China's high-speed rail construction will step on the brakes, but just reduce the accelerator." Professor Sun Zhang of the Institute of Railway and Urban Rail Transit of Tongji University pointed out in an interview with "China News Weekly", "The 13th Five-Year Plan "During this period, the average annual railway mileage in operation was 5,080 kilometers. Even if calculated according to the new plan, the average annual railway mileage in operation in the future will be 3,600 kilometers. Although the speed has decreased, the scale and intensity are still very large. "The focus is on adjusting the high-speed rail and ordinary railways. Proportion of production".

Debt anxiety

  The "Opinions" mentioned the issue of railway debts many times, requiring "proper handling of stock debts and strict control of new debts."

As the main body of China's railway construction, China National Railway Group has undertaken most of the railway investment and therefore bears huge debts.

  As of the end of 2020, the national railway operating mileage reached 146,300 kilometers, an increase of 20.9% in five years; the high-speed railway operating mileage reached 37,900 kilometers, compared with 19,800 kilometers at the end of 2015, which is equivalent to an increase of nearly 1% during the "13th Five-Year Plan" period. Fan, firmly ranked first in the world.

  The key issue is that China's high-speed rail construction is mainly financed by debt, and the huge debt is behind the rapid growth of railway mileage.

  From 2005 to 2020, the total liabilities of the National Railway Group (formerly the Ministry of Railways) have soared from 476.8 billion yuan to 5.57 trillion yuan in 2020.

According to the financial audit report of China Railway Group, as of the third quarter of 2020, China Railway Group’s asset-liability ratio has reached 65.88%, 1.5 percentage points higher than that of other central enterprises. Compared with the “percentage target”, the railway asset-liability ratio has risen instead of falling.

  The debt repayment pressure of China National Railway has arrived.

From 2016 to 2019, the scale of China's railway construction bonds is 300 billion yuan per year, of which 200 billion will be used for railway construction projects and equipment purchases, and the rest will be used for debt structure adjustment.

By 2020, the amount of registered railway bonds will be 210 billion, of which only 70 billion will be used for railway project construction and 140 billion will be used for debt structure adjustment.

  Most of these bonds of China National Railways are five-year maturities, and 2021 is the fifth year after 2016.

In other words, starting from 2021 during the "14th Five-Year Plan" period, National Railways has entered the peak period of principal and interest repayment.

At present, China Railway Group's return on net assets in recent years is only about 2%, profitability is not strong, the cash flow of railway transportation revenue is not enough to cover operating costs, and it is unable to repay debt and interest.

  Many local governments have also shouldered huge debts in the construction of high-speed railways.

In recent years, the construction of high-speed rail has extended from the developed eastern regions with high population densities to the central and western regions with small population densities. Local governments along the route have become more enthusiastic about construction and have undertaken the bulk of the construction debt.

  In an interview with China News Weekly, Professor Zhao Jian of the School of Economics and Management of Beijing Jiaotong University pointed out that the eastern region is densely populated, economically developed, and suitable for the construction of high-speed rail channels, with a high proportion of national railway funding; while the central and western regions have a small population and low density , The economy is underdeveloped, it is not suitable for the construction of high-speed rail channels, and the proportion of local government funding is high.

  The hidden risk behind this is that the construction of high-speed rail projects in underdeveloped areas will lead to high local government debt, and at the same time, the revenue and efficiency of high-speed rail will be low. Local governments will face higher financial risks than national railways.

  Take Guangxi, which is located in the southwestern border, as an example. As of the end of 2020, the mileage of high-speed rail in Guangxi is 1,792 kilometers, ranking first in the country.

  Chen Xin, a professor at Shanghai Jiaotong University, told China News Weekly that the level of economic development and population density in some places cannot support high-speed rail projects, especially in the central and western regions where local debt is already high. If the high-speed rail projects are launched blindly, it will be further aggravated. Debt risk.

  The "Opinions" proposed that in principle, no new parallel lines should be built if the utilization rate of the existing high-speed rail capacity is less than 80%.

New railway projects must be implemented in strict accordance with the plan approved by the state. Projects in the plan shall not be arbitrarily adjusted in terms of function positioning, construction sequence and construction standards. In principle, projects that are not listed in the plan shall not be started.

  In terms of investment structure, the "Opinions" proposes to increase the source of capital for railway construction through multiple channels to ensure that the proportion of equity capital for railway projects in the central and western regions is not less than 50% in principle.

At the same time, it is proposed that the construction of railways is classified and layered. The main railways are jointly funded by the central and local governments, and the National Railway Group is responsible for project construction and operation.

Intercity railways, urban (suburban) railways, branch railways and railway dedicated lines are mainly funded by relevant localities and enterprises.

  However, Wang Ming, director of the Comprehensive Transportation Research Institute of the National Development and Reform Commission, also stated in an interview with China News Weekly that the high-speed rail project is a quasi-public welfare project, and the financial data to measure the operation of the high-speed rail does not fully reflect the benefits of the high-speed rail project. And cost.

"While comprehensively considering its operating and financial situation, it is also necessary to comprehensively analyze other functions and effects brought about by the project construction."

Efficiency bottleneck

  The low actual utilization rate has been a pain point for high-speed rail for many years.

  From 2008 to 2020, China's new railway mileage is approximately 66,000 kilometers, of which 37,200 kilometers of high-speed rail.

This means that more than half of the newly built railways in the past 12 years are high-speed railways.

However, high-speed rail generally has the problems of low transportation volume, low transportation efficiency, and idle transportation capacity.

  Operating costs, population density, attendance and other factors have combined to cause the loss of high-speed rail.

For example, the Zhengzhou-Xi'an high-speed railway in the central and western regions has an attendance rate of less than 50% during the two years of operation and a loss of 1.4 billion yuan; the first intercity railway in Wuhan city circle Wuxian city railway has been in operation for more than 4 months, but the attendance rate is insufficient 50%; the average occupancy rate of the high-speed rail at Anhui Huaibei Station is only 30.8%, of which the G7294 train bound for Shanghai has the lowest occupancy rate, only 21%.

  "High-speed rail attendance has problems of regional imbalance and period imbalance." Zhao Jian pointed out to China News Weekly. On the one hand, only Beijing-Shanghai, Beijing-Guangzhou and other individual lines have an attendance rate of 80%, and many other lines. It can't even reach 50%.

On the other hand, during popular holidays, some routes may have an attendance rate close to 100%, while the off-season may not even reach 40%.

  Transportation density is an important indicator reflecting the utilization efficiency of railway transportation capacity, that is, the average transportation turnover per kilometer of railway completed in a year.

Zhao Jian pointed out that only when the transportation density of a high-speed rail line reaches 36 million km/km can it just cover the operating costs.

Among China’s high-speed rails, the Beijing-Shanghai high-speed rail has a transportation density of about 48 million kilometers per kilometer, the lowest Lanxin high-speed rail is only about 2.3 million kilometers per kilometer, and the average transportation density of the national high-speed rail is only 17 million kilometers per kilometer. about.

  On the one hand, the transportation density of high-speed rail is far below the standard, and on the other hand, the operating cost of high-speed rail is much higher than that of ordinary railways.

Among the high-speed rail operating costs that consist of electricity costs, maintenance costs, and labor costs, electricity has the highest cost.

At present, the power of the EMU with a speed of 350 kilometers per hour is 8,800 kilowatts, or 16 kilowatts per capita; the power of the EMU with a speed of 250 kilometers per hour is 4,800 kilowatts, or 78 kilowatts per capita.

This means that the cost of electricity consumption for a 350-kilometer EMU per hour can reach between RMB 5,000 and RMB 9,000.

  Zhao Jian pointed out that taking the Lan-Xin high-speed rail, which only runs 4 pairs of high-speed trains a day, as an example, its transportation income is not even enough to pay for the electricity bill, and the Lan-Xin high-speed rail has the capacity to run more than 160 pairs of high-speed trains a day.

  On the other hand, the large-scale construction of high-speed rail has caused the imbalance in the proportion of China's high-speed rail and the rapid decline in the market share of freight transport.

  From the engineering design point of view, the track of the high-speed rail is quite special and not suitable for freight trains.

It is neither economical nor environmentally friendly to run freight trains weighing 20,000 tons per train at a speed of 250-350 km/h.

From the perspective of transportation costs, many freights are unbearable even for ordinary railway freight, and it is even less likely to bear higher high-speed rail freight. This has also led to a large amount of freight demand being driven to cheaper road transportation.

  “In the future, railway planning urgently needs to adjust the proportion of passenger and freight transport appropriately.” Professor Sun Zhang of the Institute of Railway and Urban Rail Transit at Tongji University said to China News Weekly. “There are very few high-speed rail lines with a passenger load factor of over 80%. , And the freight capacity is insufficient. To increase the utilization rate, it is necessary to find ways to use the freight capacity of the high-speed rail."

  Sun Zhang pointed out that rail transport goods are generally divided into "black goods" and "white goods". "Black goods" refer to bulk commodities such as coal, ore, oil and steel, and "white goods" refer to high value-added goods such as electrical appliances and electronic equipment. .

In the past, railway freight only carried "black goods" but not "white goods", which has no longer adapted to the current freight demand.

  Wang Ming told China News Weekly that the transportation resources of high-speed rail are very precious, but to promote high-speed rail cost reduction and efficiency enhancement, it is not "headache" that only focuses on the operation of the high-speed rail network. We should consider how to establish a sustainable feedback mechanism. , Such as the promotion of comprehensive development along the high-speed rail, the promotion of TOD construction of high-speed rail hubs, and the use of surplus railway capacity to carry out cargo transportation.

Approval tightening

  As the "Opinions" clearly link the speed level of high-speed rail to the passenger flow density, the approval of high-speed rail projects has been tightened, making many high-speed rail projects that are ready to start facing variables.

Wang Ming, director of the Comprehensive Transportation Research Institute of the National Development and Reform Commission, revealed to China News Weekly that some projects included in the implementation plan have been suspended due to the influence of the "Opinions", such as the Guanzhong Plain Urban Agglomeration and Jinan Metropolitan Area. The railway project has been suspended.

For railway projects that are urgently launched in some areas, the possibility of slowing down construction is not ruled out.

  According to the procedures for approval of high-speed railway project construction, high-speed railways must first be included in the plan, and then the project can be approved and approved, and then project bidding and construction can be started according to the procedures.

However, in the more than ten years of large-scale repairs of high-speed rails across the country, local high-speed rail projects have been suspended after they started without authorization.

  In 2011, the Tianjin-Qinhuangdao high-speed railway and the Jiaoji special line were suspended due to environmental approval issues; in 2012, the Heilongjiang Hachi intercity high-speed railway, which had been in operation for more than two years, was suspended due to violations of the environmental assessment; in 2017, the Baotou high-speed railway, which had been in operation for nearly two years, was suspended. Stopped; in early 2018, Hubei Jingjing Intercity Railway, which had been under construction for less than half a year, was stopped.

  After the release of the "Opinions", the official statements of some high-speed rail projects in Shandong, Shaanxi, Hunan and other places have also changed from "has been included in the medium and long-term planning" to "being actively included in the medium and long-term planning."

  With the introduction of the "Opinions", new high-speed rail projects in the future will also face more stringent approval plans.

Regarding the 350 km/h grading standard that is enthusiastically adopted in high-speed rail projects, the "Opinions" clearly put forward three requirements: provincial capitals and megacities are connected and connected; the recent two-way passenger flow density has reached 25 million passengers per year; the proportion of long-distance passenger flow In more than 70% of the main high-speed rail lines.

  Zhao Jian told China News Weekly that the higher the speed per hour, the higher the construction standards, and the greater the scale of investment.

For a high-speed rail project to drop from 350 kilometers per hour to less than 200 kilometers per hour, the construction cost will be cut by more than half.

"Whether it is to take into account investment costs, economic benefits, travel needs, and the reality of urban development, it is necessary to determine reasonable construction standards."

  Wang Ming said that the "Opinions" have clarified that new railway projects must be implemented in strict accordance with the plan approved by the state, and projects that are not included in the plan may not be started in principle.

"New projects that fail to meet the three requirements of the "Opinions" are expected to be difficult to obtain approval in principle in the near future."

  In fact, the intensity of railway construction has begun to weaken in the late period of the "13th Five-Year Plan".

From the perspective of the operating mileage, from 2016 to 2020, the operating mileage of railways and high-speed railways will be 3281 kilometers, 1903 kilometers, 3,038 kilometers, 2,182 kilometers, 4683 kilometers, 4100 kilometers, 8489 kilometers, 5474 kilometers, 4933 kilometers, and 2521 kilometers respectively. .

2019 is the peak of the opening of new lines for railways and high-speed railways. Starting in 2020, new lines for railways and high-speed railways will begin to drop significantly.

  At the same time, equipment investment is also gradually falling.

In 2018, China National Railway Group's equipment investment reached its highest level in history, with about 160 billion yuan completed, of which about 40 billion yuan was investment in maintenance and 120 billion yuan was investment in new purchases.

Starting in 2019, equipment investment has begun to drop to around 100 billion yuan, and in 2020 it will drop to around 80 billion yuan.

  The production mileage and equipment investment will further decline.

According to the latest plan of China National Railway Group, the newly opened railway mileage will continue to decline in 2021, and the new railway and high-speed rail lines will be reduced by 24.99% and 44.83% respectively compared with 2020. Among them, the high-speed railway opened mileage will fall to the lowest value in 6 years.

At the same time, the total investment in rolling stock equipment in 2021 will be between 70 billion yuan and 75 billion yuan, which is the lowest in the past five years.

  On February 24 this year, the State Council issued the "National Comprehensive Three-dimensional Transportation Network Planning Outline" (hereinafter referred to as the "Outline").

The "Outline" stated that by 2035, the total scale of the physical line network of the national comprehensive three-dimensional transportation network will total about 700,000 kilometers, of which about 200,000 kilometers of railways, including 70,000 kilometers of high-speed railways.

  This means that in the next 15 years (2021-2035), China will build 53,700 kilometers of railways, including 32,100 kilometers of high-speed railways and 21,600 kilometers of normal-speed railways. The average annual growth rate of high-speed railways is 2,140 kilometers. 1440 kilometers.

  Compared with the previous 13 years (2008-2020), the pace of China's high-speed railway and normal-speed railway construction will slow down significantly, but the construction intensity of high-speed railways will still exceed that of normal-speed railways.

  Wang Ming told China News Weekly that it needs to be noted that the slowing of the pace of construction does not mean that the country is putting the brakes on the construction of high-speed rail, but that the scale and pace of construction must be reasonably controlled to prevent rushing and one-sided pursuit of high standards and avoid Out-of-order and out-of-control and redundant construction to prevent and control debt risks and resource waste.

China News Weekly, Issue 14 of 2021

Statement: The publication of the "China News Weekly" manuscript is authorized in writing