High-speed rail projects create broader economic benefits not measured in traditional cost-benefit analysis, according to a study by the World Bank. “High-speed rail will push China’s economy forward significantly,” said Anthony Wong, former President of the Hong Kong Logistics Association. The comments followed a report by the World Bank, which stated: “The wider economic benefits of high-speed rail in China seem more significant than in developed countries. [The projects] have the potential to deliver significant benefits.” The report said the high-speed railway between Guangzhou, in Guangdong province, and Nanning, in Guangxi, would generate benefits of CNY99 billion over the next 30 years, including CNY49 billion in indirect economic benefits not captured in conventional cost-benefit analysis. After the Beijing-Guangzhou high-speed line opened, the traditional rail link between these two cities was used to transport an additional 20 million tons of freight annually, because passengers switched to high-speed trains, said Zheng Tianxiang, Transport Professor at Sun Yat-sen University in Guangzhou. “This is very important, because trains can bring coal from the south to the north this winter while many trucks can’t transport coal due to the snow,” Zheng said. He said China was overly reliant on trucks to transport freight and needed to expand rail freight transport.

The crushing debt burden of the Ministry of Railways (MOR) has compelled Beijing to impose the biggest rise in rail freight tariffs in a decade. Although that may be bad news for freighters, it came as welcome news on the stock market, where the Hong Kong share price of Guangshen Railway, a freight and passenger rail company operating in Guangdong province, and of Daqin Railway, a coal rail operator; and shares in China Railway Tielong Container Logistics, a rail container operator, all rose on the news. The rate rise will increase Daqin’s revenue by about CNY1.6 billion this year, the Shanghai-listed firm announced. Its turnover was CNY43.5 billion in 2011. The Railways Ministry and the National Development and Reform Commission (NDRC) raised the rail freight tariff by 13%, the largest increase since 2003. Macquarie Analyst He Saiyi said the Railways Ministry’s debt burden was rising and its gearing ratio was beyond control, requiring it to generate more income. “The fact that they raised the tariffs higher than expected shows how desperate they are for cash,” she said. As of September 30 last year, the Railways Ministry’s debt was CNY2.6 trillion and its gearing ratio stood at 61.8%. Freight charges accounted for 50% to 70% of the Ministry’s revenue, and last year it collected CNY320 billion in freight revenues, only slightly above its repayment of principal and interest of CNY300 billion. He Saiyi said freight rates would continue to increase in the next few years. Last year’s 9.5% jump was already high, Bocom International Analyst Geoffrey Cheng said. In 2011, coal accounted for 64.2% of the country’s rail freight, the South China Morning Post reports.

Airlines & airports

• Air cargo throughput in Hong Kong grew 21.2% last month year-on-year to 334,000 tons, according to the Airport Authority. Stanley Hui, Chief Executive of the Authority, said the jump in cargo throughput was mainly attributable to the timing of the Lunar New Year. All major markets showed growth over January last year, with Taiwan and North America outperforming other key regions. Imports, exports and transshipments all grew by double digits.
• Cathay Pacific Services started handling airfreight at the airline’s HKD5.9 billion cargo terminal at Hong Kong International Airport on February 21. The complex, which can handle 2.6 million tons of cargo a year, will initially handle transfer transshipments, valuable cargo and transit mail under a three-stage opening program.

Ports & sea transport

• The history of Shanghai as an important shipping center for China could be older than first thought, following the discovery of about 2,000 ancient relics from the Tang Dynasty (AD 618-907). “The discovery is groundbreaking,” said Chen Xiejun, Director of the Shanghai Museum. “The porcelain uncovered not only proves the city was a major port of trade, but also a prototype as an international shipping center,” said Song Jian, Director of the Archaeology Research Department of the Shanghai Museum. “The finding is just the tip of the iceberg,” said Song, describing the 15-square-km Qinglong site southwest of Shanghai. Field research at the site could take years.
• Rongsheng Heavy Industries has entered closed-door talks with China Citic Group to issue new shares in a private placement to raise USD200 million. With Citic investment, the privately-run Rongsheng could eventually become a state-controlled enterprise. Rongsheng’s largest shareholder and former Chairman Zhang Zhirong last year paid USD14 million to settle an insider trading case in the United States. Zhang needs new investors, in particular an entity like Citic with a strong government background, to help Rongsheng overcome business challenges and financial difficulties as the global shipbuilding industry suffers a downturn amid a weak economic recovery worldwide, sources said.

The Flanders-China Chamber of Commerce (FCCC), the Province and POM West-Flanders, VOKA and UNIZO are organizing a conference: “Opportunities for Flemish SME in China” on Wednesday 27 March 2013 at 18h00 at Provinciaal Hof, Markt 3 in Brugge.

Programme:

18h00     Registration
18h30     Welcome by Jean de Bethune, Vice Governor Economy, Province of West-Flanders
18h35     Introduction by Gwenn Sonck, Executive Director, Flanders-China Chamber of  Commerce
18h40     Opportunities for Flemish companies in the province of Zhejiang, by Mrs Yin Linggu, Senior Advisor, Province of West-Flanders in China
19h00     Testimonials on doing business with China:
– Yves Struyve, CEO, Trislot
– Eddy Coppieters, CEO, Primus Group
– Didier Leclercq, Chief Operations Officer, Vitalo Industries
20h00     Q&A session
20h30     Networking reception

During the conference you will also receive the publication “FCCC Members’ Portraits in China”, describing the activities of 18 Flemish companies which have succeeded in China. The publication contains valuable information about how they tackled the very competitive Chinese market.

Registration before March 20 via this link. Fee: members of FCCC, VOKA and UNIZO: €75, non-members: €95.

The conference is organized with the support of Flanders Investment & Trade.

The UGent is organizing a China Lecture Café on China’s urban transition from a world cities perspective on Thursday 7 March from 18:00 to 20.00 h. in KANTL (Koningstraat 18, Gent).
Speaker is Prof. Frank Witlox, Faculty of Sciences, Department of Geography.

Many economic and societal changes in contemporary China have a clear-cut urban dimension. One of these dimensions is the very uneven way in which China’s ‘megacities’ are being integrated in the world economy: there are many megacities in China, but only a limited number of ‘world cities’ are intensively used by key economic actors as bridgeheads between China and the global economy. In this lecture, UGent research carried out in the context of the ‘Globalization and World Cities’ (GaWC) network is used as a starting point to assess this world city function. An overview of the uneven position of Chinese cities is presented, and subsequently used to reflect on the main causes and consequences of this situation.

Frank Witlox holds a Ph.D. in Urban Planning (Eindhoven University of Technology), a Master’s Degree in Applied Economics and a Master’s Degree in Maritime Sciences (both University of Antwerp). 

A free sandwich meal will be provided. Subscribing is free of costs, but mandatory, via https://webapps.ugent.be/eventManager/events/LectureCafes The Lecture Cafés are a joint initiative of the UGent China Platform, the India Platform and the International Office of the Faculty of Bioscience Engineering.