Study On Railway Investment And Financing

At present, China total railway has an open mileage about 73,000, accounting for about 6% of the world railway open total mileage. But Chinese railway system has the supreme density of traffic in the world, and the density of railway transportation of each kilometer is up to 32 million convert ton, which is nearly 3 times that of U.S.A., more than 2 times that of Japan.Though there is a very large railway construction fund shortfall every year, faced with the enormous constraint to the national economic development because of the shortage of railway transportation, the Ministry of Railways was determined to implement "The Medium and Long-term Railway Network Plan" in March of 2004. According to this plan, the goal of Chinese railway construction is: the total length of the railway will rise to 100,000 kilometers by the year 2020, from 73,000 kilometers at the end of the year 2003. By implementing "The Medium and Long-term Railway Network Plan", the capital that the railway construction needs will be up to 2,000 billion yuan in the following dozens of years. Namely, 100 billion yuan every year on average will be used for expanding the railway infrastructure.The annual infrastructure investment demand of the railway is about 50 billion yuan to 60 billion yuan now. By 2003, the loan of Ministry of Railways has added up to 210 billion yuan. For a long time, the owners of cargo have been levied building fee, 0.0535 yuan per ton kilometer, and the fund collects 0.0415 yuan from it, which amounts to more than 40 billion yuan every year, but the money is still unable to meet a large number of construction demand. Right now, the railway depends mainly on creditor's rights financing, chiefly from railway construction fund, annual profit and depreciation, but meanwhile it needs to repay capital with interest in a large amount.Against this kind of background, the dissertation first of all reviews the history of the reform of Chinese Investment and Financing System. The main characteristics of the railway investment and financing system of our country before reform and opening-up used to be: there was governments only in the investment subject, and relied mainly on central governmental investment. The railway acted only as investor and user, without bearing any financial responsibility. After the reform and opening-up, the measures carried out through the reform of investment and financing system are mainly as follows: implementing the economic contracted responsibility system, imposing the railway construction fund, developing the joint-venture railway, utilizing the foreign capitals to build the railway, etc..Based on this, the dissertation mainly deals with the following problems:1. The main problem existing in current System of Investment and Financing are: the monotony of principal investors, the monotony of financing ways, the backwardness of investment management, etc. These problems are those which need to be solved in the reform of the system of investment and financing, and which this dissertation attempts to solve as well.2. After having a deep study on the current Chinese railway investment and financing patterns, the dissertation presents the innovation of Chinese railway investment and financing, and some available ways such as BOT financing, ABS financing, TOT financing, investment fund, etc. are listed. Innovative rules, innovation of patterns and systems are also presented.3. By referring to related references, this dissertation presents a fuzzy comprehensive appraisal model of Chinese Railway Investment and Financing Decision, and briefly analyzes its application.4. Risk management of railway financing, closely related to the reform of the system of investment and financing, is also researched in this dissertation, including the classification, precautions and strategies concerning financing risk.5. The dissertation also deals with the Withdrawal Mechanism of Chinese Railway Investment and Financing, lists the major problems existing in the withdrawal of railway capital, presents the chief channel of Chinese railway capital, and analyzes the role that the government plays in the Withdrawal Mechanism of Railway Investment and Financing.6. The dissertation also conducts a study on protective means of the reform of Chinese Railway Investment and Financing System, such as: reforming the evaluation system of railway investment projects to regulate the investment activity; widening the entrance to the market to promote the diversity of principal investors; combining such important construction projects as special railway lines for passengers, lines for transporting coal and container yards to develop joint-venture railways; reorganizing quality capital to be listed to change the stored into the added; promoting the issue of railway construction bonds to establish "rolling bond-issue" mechanism, etc.However, because of the lateness of the reform of Chinese Railway Investment and Financing System and the complicated problems involving in it, many things have to be researched and practiced. It is hoped that with more sound and deep study, more contribution can be made to the reform of Chinese Railway Investment and Financing System.