Asia


Freight services should provide a good source of revenue for CRC.


off its debts and make a profit if it is given a free hand, one industry observer says.


Freedom has arrived


Last year the State Development and Reform Commission (SDRC) finally allowed railfreight rates to rise by an average 1.5 cents/tonne, ending a 30- year moratorium on rates. CRC does not always have to listen to SDRC, and


in early April it began to push for reform of the freight transport system. Flexible passenger fares have also been offered on a trial basis. Such measures are likely to markedly increase railway revenue.


In China there is usually a return on railway investment within 15 years. The country’s longest high-speed line linking Beijing with Shanghai, which opened in June 2011 and cost more than Yuan 220bn, is no exception. An MOR


audit in 2012 showed it registered post- tax revenue of Yuan 196m, up 532% on the first six months of operation in 2011. Its total assets were Yuan 4.49 trillion and total debts amounted to Yuan 2.79 trillion to produce a debt-to-asset ratio of 62.2%.


The debt ratio is not much of a worry says Wang Mengshu. If the debts could be cleared in two or three years, CRC would surely pass into a period of profitable operations, he said. IRJ


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—27th September 2013 in Gdansk! www.vem-group.com 22 IRJ August 2013


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