CHINA RAILWAY SECTOR
2018-2022

The railway sector has been playing a vital role in China’s social and economic development. The country relies on railway freight, including that of natural resources such as coal, or metal ores. Dynamic urbanisation and socioeconomic changes, on the other hand, increase rail passenger traffic.

SECTOR IN NUMBERS

The country is the second largest railway freight transporter in net tonne-km (tkm) globally and the largest passenger carrier in terms of passenger-km (pkm).

127,000 km

Total Length in Operation

3,084 mn persons

Passenger Traffic

3,689 mn tonnes

Freight Traffic

SECTOR IN FOCUS

LENGTH IN OPERATION, KM
LENGTH IN OPERATION

China’s railway network has been growing steadily in recent years, making the country the third largest railway operator in the world. Its total railway length reached 127,000 km in 2017, including 87,000 km of electrified railway and 25,000 km of HSR. In the coming years the railway network will expand mostly due to the growth in the HSR segment. By 2035, China’s railway network should include 45,000 km of HSR, according to CR.

By the end of 2017, 34 Chinese cities (excluding Hong Kong, Macao and Taiwan) had urban rail transit systems with a combined length of 5,033 km, according to the China Association of Metros (CAM). In 2020, the total length of operating urban rail transit system is projected to rise to 7,700 km, as stated by CAM. The development of country’s railway system is the focus of several major government strategies including the Five-Year Plan on Transportation (2016-2020), issued by the State Council in February 2017, and the Three-Year Plan for major transportation infrastructure construction projects (2016-2018), released by the China’s Ministry of Transportation and the National Development and Reform Commission (NDRC) in May 2016. The plan oversees a total of RMB 1.6tn in spending on urban rail transit projects.

PASSENGER RAILWAY

In 2017 China’s passenger traffic continued to grow and increased by 9.6% y/y to over 3.08bn persons. National railway accounted for 98.5% of the total passenger traffic, generating passenger traffic of nearly 3.04bn persons, 9.6% higher y/y. Total passenger turnover reached almost 1.35tn pkm, up by 7% y/y, with national railway accumulating a turnover of 1.34tn pkm, or 6.9% higher y/y.

Passenger transportation has seen a steady and firm growth over the past years, as a result of China’s economic development, industrial restructuring and the consequently growing transportation needs. The HSR network, which in 2017 accounted for 60% of the world’s total length, is considered to be a very efficient mean of ground transportation compared to other land transport means that are vulnerable to traffic issues and delays. For distances of 150–800 km, HSR is considered even more competitive than air transport. By 2030, China’s HSR network is projected to connect all provincial capitals, except for Lhasa, and cities with population over half a million. The expansion of HSR is expected to reduce disparities in transport accessibility across regions, as well as substantially cut travel time.

PASSENGER TRAFFIC, MN PERSONS, 2017
FREIGHT TRAFFIC, MN TONNES, 2017
FREIGHT RAILWAY

In 2017 China’s total railway freight traffic recovered after three years of decline, and grew by 10.7% y/y to 3.69bn tonnes. The freight traffic of the national railway rose by 10.1% y/y to 2.92bn tonnes. Freight turnover, which had previously been falling since 2013, increased by 13.3% y/y in 2017 to 2.7bn tkm. The freight turnover of the national railway also followed the trend, picking by 13.3% y/y to 2.41bn tkm.

The improved performance was a result of strong economic activity in 2017, after a weaker economic growth in the previous three years. The increase in freight transportation volumes was also due to a deepening of the country’s supply side reform. The recovery of the bulk commodity freight, including coal, coke, metal ores and industrial transportation, contributed greatly to the increase in freight volumes and the higher revenues generated by railway companies.

CR projects that in 2018-2020 the freight traffic of the national railways will increase by 1.1bn tonnes, bringing the total to 4.8bn tonnes in 2020. Bulk commodities are expected to account for over 90% of the volume.

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