Railway investment has ushered in a turning point, with multiple major projects densely approved nationwide | Railway | Investment

After three consecutive years of decline, fixed investment in railways is expected to increase at a faster pace and recover in total this year.

According to data recently released by the National Railway Administration, from January to May this year, the national railway completed fixed asset investment of 206.1 billion billion yuan, a year-on-year increase of 7.2 percent, and the growth rate was 0.9 percentage points faster than that from January to April.

China Business News found that since the beginning of this year, in January, January to February, January to March, January to April and January to May, the national railway fixed asset investment increased by -4.8, 5.9, 6.7, 6.3 and 7.2, respectively, showing an overall momentum of accelerated growth.

Intensive approval of multiple lines

Behind the increase in investment is the acceleration of the progress of projects under construction. According to the official website of the State Railway Group, recently, the State Railway Group has seized the golden period of construction, promoted railway construction with high quality and efficiency, and completed as much investment and physical workload as possible on the premise of ensuring the quality of the project. A large number of engineering projects have made new progress and breakthroughs.

According to the plan at the beginning of the year, in 2023, the whole road is expected to put into operation more than 3000 kilometers of new lines, including 2500 kilometers of high-speed rail. According to the National Railway Group, the Guinan High-speed Railway, the Fuzhou-Xiamen High-speed Railway, the Shanghai-Nanjing Yanjiang High-speed Railway, and the Changjinghuang High-speed Railway have entered the countdown to opening. In addition, the construction of the Xiongshang High-speed Railway, Xiongxin High-speed Railway, and Jinwei High-speed Railway has made solid progress.

The accelerated progress of these ongoing projects has strongly boosted the growth of fixed investment in railways. Not only that, various localities and departments are also stepping up efforts to promote the start of new projects, and more projects will enter the full construction stage, which will form an increase in investment.

The National Development and Reform Commission held the twelfth national railway project preliminary work consultation meeting in April, and determined that the country will focus on promoting 40 railway projects in 2023, including 20 planned new projects and 20 reserve projects, which will undoubtedly promote key projects. The progress of project construction.

On May 9, the coordination mechanism for promoting effective investment in important projects in Yunnan Province held a special scheduling meeting for key pre-railway projects in 2023. The meeting requested that, in accordance with the work requirements of the National Development and Reform Commission's "weekly scheduling and monthly report", the preliminary work of the project should be regularly scheduled, the problems existing in the preliminary work of the project should be coordinated and solved, and the preliminary work of the four key railway projects in Yunnan Province should be fully promoted.

According to the special meeting on railway construction in Ningxia in 2023, there are two projects in Ningxia. Among them, the capacity expansion and reconstruction project of Yinchuan Zhongwei section of Baolan railway is a national medium and long-term railway network planning project, which is not included in the national "14th five year plan" railway development plan, and is directly listed as a new project in 2023, which advances the original planned start time by 3 to 5 years.

Chen Yao, vice chairman and secretary-general of the China Association of Regional Economics, told China Business News that investment in transportation infrastructure construction is also an engine for expanding investment and stimulating economic growth. Under the current economic situation, some railway projects take this opportunity to accelerate construction and lay the foundation for long-term development.

In fact, since the beginning of this year, the preliminary work of railway projects has been significantly accelerated, and more than a dozen railway projects have been approved by the National Development and Reform Commission or the National Railway Group and local governments. Among them, since May, projects including Hepu-Zhanjiang high-speed railway, Shaoyang-Yongzhou high-speed railway, Weizhou-Suzhou high-speed railway and Qingdao connecting line, Hefei-Wuhan high-speed railway and other projects have been approved.

On June 26, Zhanjiang Development and Reform Bureau issued the first environmental impact assessment information disclosure of the new Hepu-Zhanjiang high-speed railway. The feasibility study report of the project has recently been approved by the National Development and Reform Commission. The Hezhan high-speed railway has undergone two adjustments, and the design standard has been increased from 200 kilometers per hour to 250 kilometers per hour, and then to 350 kilometers per hour.

Railway projects have to go through multiple approval procedures such as preliminary design and construction drawing design from the approval of feasibility study to the final start of construction, and each procedure requires multiple preconditions for approval. After the approval of the feasibility study, the approval work of different departments in other links is also accelerating. The acceleration of these preliminary work has laid the foundation for the start of the project.

In March this year, the feasibility study report of the Huangtong to Baise railway was approved by the National Development and Reform Commission. Recently, the pre-examination of the construction land of the Huangbai Railway Project was approved by the Ministry of Natural Resources. The total area of the pre-examination of the project land is 179.46 hectares. After the pre-examination of the land is approved, the project will enter the stage of approval of the first land, laying a solid foundation for the early start of construction.

Not only that, the local government is also speeding up the progress of the project. For example, Hainan Province recently held a mobilization and deployment meeting for the construction of the Zhanhai high-speed rail project, requiring the overall scheduling of all positive factors and going all out to promote the construction of the project within this year. The line mainly includes the Zhanjiang-Haian railway project and the Qiongzhou Strait ferry project, with a total investment of over 50 billion yuan.

Railway investment ushers in an inflection point

In the last three years, railway investment has generally shown a downward trend. In 2020, the national railway fixed investment fell below the scale of more than 800 billion yuan, which has been maintained for 5 years. In 2022, fixed investment in railways nationwide was 710.9 billion billion yuan, the lowest since 2014, down 5.1 percent and 0.9 percentage points more than in 2021.

At the beginning of this year, the State Railway Group did not announce this year's railway investment plan, but at the 2023 railway construction work conference, it emphasized to speed up the implementation of railway projects in the 102 major projects identified in the "14th Five-Year Plan" outline, and strengthen the support and pull of railway construction investment.

Chen Yao said that at present, the "eight vertical and eight horizontal" high-speed rail network has basically taken shape, and now the supplementary lines of the network are being built. Infrastructure construction is a greater driving force for the economy. At this stage, there is still room for growth in railway investment. The railway network as a whole is not enough to meet the needs of travel and freight. For example, the railway density in the central and western regions is not enough, and even some provincial capitals The communication is not enough.

The State Railway Group also said that the railway department focuses on networking, replenishing the network, and strengthening the chain, takes effective and effective measures to speed up the preliminary work, and promotes the start of new projects in a scientific and orderly manner, so as to provide more support and guarantee for stabilizing investment, expanding domestic demand, bringing employment, and protecting people's livelihood. At its monthly meeting in June, it was asked to ensure the completion of railway investment target tasks and physical workload.

The supporting role of infrastructure construction, such as railways, in fixed investment and economic growth has emerged. According to data from the National Bureau of Statistics, from January to May, infrastructure investment increased by 7.5 year-on-year, and the growth rate was 3.5 percentage points higher than that of all fixed asset investment. Among them, investment in the railway transportation industry increased by 16.4, investment in water conservancy management industry increased by 11.5, and investment in information transmission industry increased by 7.5.

In May of this year, the National Railway Group released "Railway Engineering Construction Press the" Fast Forward Button "to Stimulate New Mkinetic Energy." The article stated that in the first quarter, the national railway completed infrastructure investment of 75.6 billion billion yuan, a year-on-year increase of 6.7 percent, driving steel, cement, construction machinery, etc. The recovery and development of multiple industries have played the role of railways in stimulating and supporting the restoration and expansion of domestic demand.

Great Wall Guorui Securities Research Report believes that during the "13th Five-Year Plan" period, railway fixed asset investment completed 3.99 trillion yuan, an average of 798.02 billion yuan per year. The completion of national railway fixed asset investment in 2021 and 2022 is much lower than the level of the same period in the 13th five-year Plan, so they judge that national railway investment is expected to enter a period of acceleration from 2023 to 2025.

Zheshang Securities Research Report that after the epidemic, railway investment is expected to inflection point upward, 2016~2020 railway investment scale of about 4 trillion yuan, is expected to "14th Five-Year Plan" investment scale and "13th Five-Year Plan" equivalent, 2023~2025 average annual about 840 billion yuan, 18% higher than 2022. However, this is expected to exceed the annual peak of railway investment, that is, 823.5 billion yuan in 2010.