Even as the People’s Republic rail network evolves into the world’s second largest in terms of mileage, Chinese rail companies have begun adding tracks to other countries’ networks as well. Most recently, China’s Ministry of Railways announced the possibility of extending its high-speed train network into Europe, which might eventually allow travelers to connect between London and Beijing in just two days.
One proposed line would pass through India, Pakistan and the Middle East, while the alternative would connect through Russia into Germany. These options necessitate collaboration with up to 17 nations, a process that could last up to a decade. A third regional high-speed option, in addition to the trans-European proposal, would extend southward from China, connecting through Vietnam, Thailand, Burma and Malaysia. The Southeast Asia line has already begun construction.
The China Railway Construction Corporation, in particular, has been winning deals worldwide, with business covering over 60 foreign countries and regions in the world. It claims 137 overseas projects currently under construction, and whereas overseas activities served as a piddling revenue share in the early 2000s, as recently as 2007 they had risen to nearly 40%.
From Africa to Europe, Southeast Asia to South America, very few land masses in the world have not been touched by Chinese-made rail technologies. These include rail assignments as varied as the trans-national Tanzania-Zambia Railway Project, to involvement in a light rail concession with the city of Tel Aviv. Industrial lines in Libya span both west-to-east and south-to-west, while a passenger high-speed rail project in Saudi Arabia will connect Mecca to Medina in just half an hour at speeds of 360 kilometres per hour.
Financing often comes from China. In February 2009, CRCC enjoyed the world’s second largest-ever IPO (following Visa’s), raising US$5.7 billion, 90% of which was earmarked for purchasing equipment to be used in overseas projects. This March, China Railway Group won a deal to build and operate an Indonesian coal railway, with state-owned financial institutions availing advantageous financing terms. In Burma, part of the deal hinged upon China offering to cover the costs in exchange for access to the country’s lithium reserves, a metal used in batteries.
Surprisingly, even overseeing China’s groundbreaking Qinghai-Tibet rail line, Peng Jianghong, Deputy Chief Engineer for CRCC, remains modest. When nudged as to whether China’s rail abilities are the world’s best, he shrugged, instead pointing out European and American capabilities.
Originally published in the June “Transportation Special” of Monocle magazine.