Studies On The Application Of PPP Model In China’s Urban Rail Transit Projects

The development of urban infrastructure has always been regarded as the responsibility of the state,which should be invested,built and run by the state Because infrastructure such as urban rail transit needs large initial investment and a long period to balance with a rather low interest rate,private companies are unable or unwilling to either undertake its construction or operate it.However,with the development of social economy,it is increasingly difficult for the government to take full responsibility of urban infrastructure along.Therefore,it is imperative to introduce flexible and diverse market-based financing models to construct urban infrastructure.In the past ten years,with the restriction and release of examination and approval on railway issues,together with the transformation of government roles and the increasing demand of the society,the state has encouraged the urban rail transit market in opening to the public to realize the diversification of investment and financing entities.This paper starts with the application of PPP mode in the field of urban rail transit,through sunumarizing the history and current situation of urban rail transit development and the applicative basis,main operation mode,operation procedures and history of development of PPP mode in China’s urban rail transit project,along with using the public product theory and user charging mechanism,to explore the applicability of PPP model in the development of urban rail transit in China.In addition,this paper analyzes the application of PPP mode in Hangzhou Metro Line One and lists projects to improve the original PPP mode to better picture the future of PPP mode in the development of urban rail transit.Finally,it is concluded that the application of PPP mode in China’s urban rail transit is only applicable when its quasi-public products are properly known and well measured as well as user fees are reasonably charged.The Government and the private enterprises should value regional characteristics with its prior investment,advanced interest-return meehanism and risk distribution mechanism to ensure the sustainable development of the project.Meanwhile,the future development of Hangzhou Metro should also be taken into consideration when suggesting directions for future exploration.In other words,we can use the empirical methods to contrast the different economic impacts of Hangzhou Metro with PPP model and without PPP model to further highlight the applicability of the PPP model.In addition,the extensive application of PPP mode should be considered to provide more risk prevention methods when PPP mode is applied some day.