Paul Chong Monday, 6 February 2017
Chinese are smart & quick learners . . . by the process of “reversed engineering” they have in less than 10 years mastered the high speed rail technology. Now they are highly competitive pushing its way (overcoming obstacles) to connect the whole world with its quality technology.
With political will, incentive packages backed by financial resources such as AIIB (Asian Infrastructure Investment Bank), China Construction Bank or China Development Bank (which has in fact overtaken the World Bank), every possibility is at hand to see to its economic success of circumventing the world with high-speed rail (HSR).
Here China’s policy of win-win formula for all who jump unto the train wagon. It attracts investors & political leaders alike on a mutual benefit basis with little or no string attached. Developing economics & no less others are being pulled by China’s special incentive packages.
By 2020, only three years from now, experts are optimistic & predicting that you can enjoy at high speed from Beijing to London. Perhaps if not, by 2025. It follows then to travel from London under the Atlantic to New York!
The economic light shines bright at the end of the tunnel.
China’s first high-speed railway started operation in 2008 between Beijing and Tianjin. However, the whole project has not proceeded without major missteps. An accident on a high-speed rail line in Wenzhou, Zhejiang province in July 2011, killed at least 38 passengers and injured nearly 300, casting a shadow over the safety of China’s high-speed rail industry. Could the project be moving too fast?
As evidenced from the above accident which led to the sacking & imprisonment of the corrupted Minister of Transport, Liu Zhijun, the future of the high-speed rail system appeared to be doomed. In the initial stage, China suffered several setbacks when it pushed to export its high-speed rail technology . . . countries such as Venezuela, Mexico and Thailand turned down.
The most recent setback was the US company XpressWest’s termination of its contract with China Railway International for a high-speed railway connecting Las Vegas and Los Angeles.
However, the low cost of Chinese products has been a traditional advantage. China’s bullet trains were a third cheaper than Japan or Germany’s, and were built in half the time of Japanese ones, Chinese experts said.
China’s “One Belt, One Road” initiative, the New Silk Road by land & by sea, proposed by President Xi Jinping, aimed at boosting trade links and infrastructure such as railways attract a great deal of attention & many countries along the belt route. China is to help Iran build high-speed rail as part of ‘One Belt, One Road’ strategy.
China and Japan are the biggest two competitors in the global high-speed railway market. Japan’s Shinkansen started operating domestically in 1964, when it became the world’s first high-speed rail system in commercial use. It is also the safest railway, without a fatal accident on record.
“Too many factors are involved in the setbacks of high-speed rail exports. Usually problems are unrelated to the production itself, but such as the terms of loans, level of interest rates and whether buyers can offer sovereign guarantees,” an executive at the China Railway Rolling Stock Corp (CRRC) headquarters said.
Officials from nearly 20 developing countries in Africa, Asia and South America visited the China Railway Rolling Stock Corporation’s (CRRC) Tangshan factory recently in a week-long program arranged by the Hong Kong-based Finance Centre for South-South Cooperation.
Most came from countries along the route of China’s “One Belt, One Road” initiative aimed at boosting trade links and infrastructure such as railways.
According to Weekend Australian recent report( 2 Oct. 2015), after months of confusion, back flips and uncertainty, the Indonesian government has finally awarded the contract to construct a prized railway link between Jakarta and Bandung to China. The disappointed Japanese chief cabinet secretary Yoshihide Suga broke the news to the world, saying: “I can’t understand this at all. It is highly unfortunate.”
Beijing has simply outmanoeuvred Tokyo on this bid as a result of a competitive financing package for Indonesia.
The Wall Street Journal reported that Gatot Trihargo, deputy minister for financial services at Indonesia’s Ministry of State-Owned Enterprises said China’s plan met Jakarta’s criteria that the project not depend on Indonesian financing or a loan guarantee.
High-speed rail contracts have become the latest battleground for China and Japan. Though Japan is famous for its sophisticated and mature high-speed rail technology, Beijing has proven to be a formidable challenger on the international stage. In a little less than a decade, China has managed to build 60 per cent of the world’s high-speed railway network.
China’s ability to digest and improve imported foreign technology. referred to as “reversed engineering”, has been even more important to this process than the speed at which it can construct new lines. The country is now in a position to export high-speed trains with its own proprietary technology.
The extraordinary success of China’s high-speed rail industry can be credited to Liu Zhijun, a former railway minister, as mentioned, is now languishing in prison following his conviction on bribery charges.
He masterminded a clever scheme whereby participating foreign partners & investors having to agree with “technology sharing”.
Liu’s goal was simple, he wanted Chinese train makers to digest foreign technology as quickly as possible and then develop China’s own technology on that foundation. In 2004, leading international train makers such as Bombardier, Kawasaki and Alstom had no choice but to form joint ventures with Chinese makers to bid for these large projects.
German maker Siemens joined the game a year later after initially refusing to share the technology with the Chinese in 2004. The temptation of hitching a wagon to the fast-expanding Chinese market was simply too hard to resist, even though these companies knew that their technology was at risk.
These technology-sharing agreements significantly improved the ability of Chinese train makers to design and manufacture advanced trains. Though foreign partners didn’t share some core proprietary technology with the Chinese, Beijing nevertheless benefitted enormously from these joint ventures.
In 2008, the then railway ministry (it’s since been disbanded) and the technology ministry signed an agreement to mobilise the entire country’s engineering and technology talent to build the next generation of train technology.
The mobilisation of human resources is simply staggering. Over 10,000 engineers, researchers and technicians were involved in the project. This engineering army included 60 fellows of Chinese academies of sciences and engineering and 500 university professors. The Manhattan Project was similar to this with the US government’s effort to build an atomic bomb ahead of the Nazis.
In a little less than a decade, China has built a “high-speed train industry/economy” from scratch and it is capable of making high-tech trains from its own proprietary technology. President Xi Jinping & his premier Li Keqiang never fail to market it whenever & wherever they are. The development of China’s high-speed train industry is a clear example of the party’s mobilisation strength.
Chinese engineers can quickly absorb, adapt and improve foreign technology for their own ends. Once they’ve digested existing technology, they are capable of developing that into the next generation.
China has built the world’s largest bullet-train network.
Less than a decade ago China had yet to connect any of its cities by bullet train. Today, it has 20,000km (12,500 miles) of high-speed rail lines, more than the rest of the world combined. It is planning to lay another 15,000km by 2025 (see map). Just as astonishing is urban growth alongside the tracks.
High-speed rails are more than just a mode of transport. China wants to build a “high-speed rail economy”, obviously with multiple economic & social benefits accruing thereby, such as road congestion reduction, growth of urbanisation, attracting & distributing population along its route.
The World Bank, for one, is optimistic. In a report published in 2014 it said the benefits of high-speed rail would be “very substantial”, potentially boosting the productivity of businesses in China’s coastal regions by 10%.
The network expansion now under way is even bolder than Mr Liu had envisaged. China has a four-by-four grid at present: four big north-south and east-west lines. Its new plan is to construct an eight-by-eight grid by 2035. The ultimate goal is to have 45,000km of high-speed track.
By 2020-2025, Chinese High-Speed Rail Link will connect Asia and Europe, Africa & South America, Indonesia & Malaysia . . . all speeding on with China to the greater global economy.