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All Roads Lead to China™
Home > Doing Business with China > Transportation and Logistics Overview > Rail Logistics in China
China’s Railway infrastructure has received relatively low levels of investment when contrasted with that received by China’s road and port infrastructure. Finally resorting to allowing foreign investment to spur growth, the Ministry of Railways has relatively modest plans to increase China’s existing rail network from 72 000 km to 100 000 km in 2020. Use of the Chinese rail system increased 6% year on year between January of 2003 and January of 2004, though it would appear that this relatively modest increase can be less attributed to weak demand than the limitations posed by serious under capacity.
Railway bottlenecks and the inability of the railway system to transport the requisite amounts of coal were in large part responsible for the power shortages of the summer of 2004. This has since led to the prioritization of coal shipments leaving other commodities and cargoes sitting on docks. Many importers, most notably China’s steel mills have been struggling to find enough railcars to carry cargo and now often resort to barges and trucks at much greater cost.
Poor handling practices, delays, unpredictable delivery times, bulk shipment requirements, theft, minimal shipment tracking, the lack of inter-modal facilities, and a general lack of infrastructure all plague the Chinese railways. However, despite these issues heavy subsidization still makes rail China’s cheapest form of overland transport for shippers. |
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