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Railways seeking overseas investment
By Cao Desheng (China Daily)
Updated: 2005-09-21 05:52
China's once-monopolized railway sector is riding the rails of market-opening reform, as it strives to attract overseas capital investment.
"Foreign enterprises are in talks with domestic railway companies on investment," Huang Min, chief economist of the Ministry of Railways, told China Daily yesterday.
The negotiations are expected to bear fruit soon, Huang said, but would not reveal details of the parties involved, citing business confidentiality.
According to industry insiders, this means the sector will open more widely to foreign capital, though overseas investors will not be allowed controlling interests on the operation of trunk lines.
In July, the Ministry of Railways released guidelines encouraging private and foreign capital in railway construction and operation.
At least 100 billion yuan (US$12.3 billion) is needed annually to expand the rail network from the current 73,000 kilometres to the planned 100,000 kilometres by 2020, according to the national plan.
Although the sector has been gradually opening to non-government funding, investors have been slow in responding to the government's policies.
Only a very small amount of non-State capital has been injected into the sector in recent years - less than 1 per cent of the total.
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