China plans to develop every Silk road country and pledges using $4 trillion in reserves to drive overseas expansion of industry, nuclear and rail

China’s two domestic High Speed Rail (HSR) manufacturers, China North Railway (CNR) and China South Railway (CSR), now control the country’s entire HSR market.

By 2014, just six years after the launch of China’s first HSR passenger service, there was 16,000 km of tracks, connecting most major cities.

However, building more than half of the world’s total HSR lines in ten years is just the beginning, as there are plans to add another 16,000 km of track by 2020.

Not just satisfied with domestic expansion, China has been ambitiously extending its influence beyond its borders.

China lowered production costs while higher labor efficiency helped shorten delivery time for one train to 12 months, compared with between 18 and 22 months required by foreign manufacturers.

There are trillions of dollars needed to build a shortfall of global infrastructure. China is going to try to finance and build as much as possible. It will solve the problem for decades of how will China still have high levels of investment driven GDP growth

Boosted by President Xi Jinping’s Silk Road belt and road initiatives, China is currently in negotiations with 28 nations, most of which are along the trade route. Should discussions bear fruit, a network of over 5,000 km is on the cards.

The Silk Road economic belt and the 21st century maritime Silk Road are a land-based belt from China via Central Asia and Russia to Europe; and a maritime route through the Strait of Malacca to India, the Middle East and East Africa.

China is also considering another ambitious proposal, initially raised by Wang Mengshu, which would see a HSR line originating in Beijing that passes through Siberia, Alaska and Canada before reaching the US.

In July, 2014, the Ankara-Istanbul high-speed rail network jointly built by the Chinese was launched. More than 20 other countries, including Thailand, Brazil, Mexico and Russia have either been working with China to build high-speed rail networks or are seeking opportunities to work with the country on related projects. The total investment value has come to an estimated US$480 billion, the report says.

“Considering the approved railway-construction projects, the output value of China’s high speed railway is likely to exceed US$64 billion in 2015,” says Cai Jianming, an industrial analyst with Guangdong’s CI Consulting.

A growing number of projects in both China and overseas will prompt further economic growth in China, allowing it to transform its economic structure by addressing the dilemma of exporting low added-value products on a large scale and expanding its technologies worldwide.

Most of the countries encompassed in the one belt and one road Silk road map are emerging economies or developing countries where basic infrastructure is relatively inadequate, investors and developers will have ample room for development projects.

China is rolling out a series of measures to aid overseas expansion by firms across industries, especially nuclear power and railways, the cabinet said on Wednesday.

China’s outbound investment last year hit $102.89 billion, for an annual increase of 14 percent, state news agency Xinhua said, but the country’s decade-old “going out” policy has primarily aimed to help state-owned firms establish themselves abroad.

The new measures would also aid steel, construction and equipment-making firms in “going out” by boosting trade and investment deals, and pushing domestic economic restructuring, the government said in a statement on its website.

The government pledged greater support for firms issuing stocks and bonds overseas and to broaden the use of foreign exchange reserves of $3.84 trillion to drive their growth.

It also promised “reasonable and convenient” financing for enterprises, and the use of “policy-based financial tools” to boost Chinese firms, besides working to foster angel investment and venture capital.

China’s government will also help provide subsidies for rent, broadband and software, as well as low-cost buildings for businesses.

Nextbigfuture has earlier reports that China is going all in to be the infrastructure builder for the world.

SOURCES – Reuters, China Daily, WantChinatimes