China sets deadline for a new economic boom – The next 5 years

China has clearly become a global economic power and, for the next 5 years, the authorities plan to maintain this status by implementing programs aimed at achieving an annual economic growth of 7%. The government plans to reduce energy consumption and CO2 emissions by 16% and 17%, respectively, which will encourage rail transport. By 2015, China will have 45.000 km of high speed rail.

In the next 5 years, China’s economy will continue to grow, with a GDP growth rate of 7%. Prime Minister Wen Jiabao announced an economic increase of 8% for 2011, just like the years before, but this level will most likely be exceeded.
The strategy for 2011-2015 is based on 7 pillars: economic reorganization, innovation, environmental protection and renewable energy, agriculture, social improvement and increase in the standard of living, reform.
“We will do our best to coordinate the citizens’ revenue increase through economic development (…) China will have a fast evolution and we will be open to trade and global investments”, said the Chinese Prime Minister, presenting the country’s development strategy.
China plans to generate new sources for the domestic demand, optimize emerging strategic industries and develop the services sector, which will represent 47% of the GDP (+4%).
China plans to allocate 2.2% of the GDP for research and development, 1.8% more than in 2010. This way, China will bring new innovations on the domestic market in terms of modern technology, focusing on the practical industrial applications. The program that has been launched for the manufacture of engines for high speed rail transport is an example of innovation.

Boost in urbanization: rail transport, a solution to ensure mobility

Referring to “environmental protection and energy efficiency”, the Chinese authorities plan to implement projects aiming at reducing energy consumption by 16% and CO2 emissions by 17% by 2015. According to China’s Action Plan, the ratio of non-fossil fuel used for primary energy consumption should reach 11.4% throughout the next 5 years, and major pollutants should be reduced by 8-10%. Seeing as urbanization is on the increase (+4%), reaching 51.5% by 2015, China plans to improve public services especially in the urban area. The policies promoted through China’s Action Plan will also promote and increase the attractiveness of rail transport.
The last few years brought an economic boom for China, especially due to the projects focused on rail infrastructure development, seeing as the economic growth depends largely upon the implementation of infrastructure projects, said Prime Minister Wen Jiabao during a speech aimed at presenting China’s new strategy. For China, high speed rail transport is not only a luxury service, but also a necessity, a fact proven by the statistical data concerning the number of passengers. For the next 10 years, China’s Ministry of Railways estimates an increase of 100% and, in order to achieve this goal, according to the Strategy for 2011-2015, new lines will be built. The total length of the high speed network will be of 45,000 km. China plans to develop projects for high speed rail that will cover almost all the cities that have a population higher than 500,000 inhabitants. The strategy also stipulates the construction of a rail link between the Sichuan province (south-east) and Tibet.
”High speed rail projects are very important, especially from the point of view of the return on investment. To that end, some of the largest banks have provided financial support for these new projects”, said Yan Qingmin, Vice-Chairman of the China Banking Regulatory Commission, during an interview for China Daily. During 2005-2010, China invested over USD 300 Billion in railway construction, six times more than the level of investments allocated during 2000-2004, shows the National Bureau of Statistics of China. Last year, the Ministry of Railways announced that, during 2011-2015, the rail sector will benefit from investments of USD 107 Billion.


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