A new golden age of rail

Chinese authorities have significantly built out high-speed rail as part of the current five-year plan and have made no secret of wanting to be the world’s leaders in terms of track length and number of lines. Now they have announced a ‘one belt, one road’ policy, also known as the ‘silk road’

The ‘one belt, one road’ initiative is designed to connect – via rail and sea – China to Europe through India and Africa in one direction, and to the South Pacific in the other.1 China is looking for ways to boost its economy now that its growth is slowing, and one way to do that is to look outward. The businesses working in China’s rail sector have in many cases worked with Western companies and, through technological share, obtained intellectual property that puts them on par with these global leaders.

The UK’s High Speed 2 (HS2) would represent just a small fraction of the record-breaking lines being built and planned in China. Phase one is designed to run 192km between London Euston and the Midlands, with phase two potentially extending to the North-West and North-East of England and perhaps even beyond into Scotland. Yet at an estimated cost of at least £50bn the funding behind HS2 has created some controversy and public support is patchy at best.

Justin Sumner – The Boston Company Asset Management, a BNY Mellon company

1 JOC.com, ‘What is China’s ‘one belt one road’?’

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3 Comments on “A new golden age of rail”

  1. Fundador

    Although clearly the Chinese benefit from economies of scale, cheaper manpower and much lower planning costs, there has to be concern about the scrutiny of major public projects of this kind.

    Strategically, while it is desirable to link the North (including Scotland) with the South of Britain more efficiently, and to ‘modernise’ our transport infrastructure, yet – as with new airports – there seems a remarkable dearth of both consensus and hard data.

    Reply
    • Justin Sumner

      Thanks for your comment. The tight connection between Chinese government and the Chinese Rail names (being State Owned Enterprises) provides a higher degree of confidence in execution of their domestic agenda with minimal delays and cost overruns. The concerns you raise are quite valid and something that we will be monitoring closely. These are typical of large scale infrastructure projects particularly in the Western world.

      Reply
  2. Fundador

    Not just railways is it ? Why not a whole new airport to the East of London rather than a third runway at LHR ?

    Reply

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