The Ministry of Railways has decided to have multiple investors
in all its new sections as part of its financial reforms, a top
official has said.
Speaking at a national conference recently, Minister of Railways
Liu Zhijun invited local governments, State-owned and private
enterprises, social investment institutions and overseas funds to
invest in the railways.
The ministry will urge the three listed railway companies to get
refinance, seek investors for State-owned railway transport
companies, and raise the amount of construction bonds to be issued
this year.
Liu said the scale of jointly funded railway projects and the
percentage of social funds in total investment both will grow this
year.
This is the first time that financial reforms have been listed
among the ministry's annual working priorities, the Economic
Observer has reported.
Liu didn't elaborate on the plans, but the newspaper said
several firms were eager to invest in the railways, and had already
contacted China Railway Special Cargo Service Co and China Railway
Express Co.
Some foreign firms will probably invest in China Railway
Container Transport Co, insiders have said, but the ministry has
not confirmed it.
Last year, Datong Qinhuangdao Railway and GuangzhouShenzhen
Railway, too, raised 15 billion yuan (US$1.9 billion) and 10.3
billion yuan (US$1.3 billion) from the stock market.
The ministry also raised 40 billion yuan (US$5.1 billion)
through railway construction bonds.
In the past few years, more than 30 provincial and municipal
governments have signed collaboration agreements with the ministry,
which last year also raised funds from them and domestic strategic
investors.
At least 70 social investment institutions and enterprises have
signed deals with 26 jointly funded railway companies, creating 44
billion yuan (US$5.7 billion) in social equity funds, including 2.5
billion yuan (US$321.5 million) in private capital.
According to the ministry's 11th Five-Year Plan (2006-10),
17,000 km of new tracks will be laid across the country at a cost
of 1.5 trillion yuan (US$193 billion), double the amount spent
during the previous five-year plan.
The railways' move is "a big breakthrough", Citic Securities'
Research Department Director Yu Jun said.
The money raised from the stock market hit a record last
year.
(China Daily May 2, 2007)