SCIO briefing on its white paper on the development of China's transport

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Yang Chuantang, secretary of the Leading Party Members' Group of the Ministry of Transport, Feng Zhenglin, vice minister of the Ministry of Transport and director of the Civil Aviation Administration, Ma Junsheng, a member of the Leading Party Members' Group of the Ministry of Transport and director of the State Post Bureau, Yang Yudong, vice minister of the Ministry of Transport and director of the National Railway Administration.

Hu Kaihong, vice director-general of the Press Bureau, State Council Information Office

Dec. 29, 2016

Chairperson Hu Kaihong:

Good morning, ladies and gentlemen. Welcome to today's press conference. Today, the State Council Information Office has issued a white paper on the Development of China's Transport. We'll brief you on its contents as well as related information on the development of China's transport. Today we have with us Mr. Yang Chuantang, secretary of the Leading Party Members' Group of the Ministry of Transport, Mr. Feng Zhenglin, vice minister of the Ministry of Transport and director of the Civil Aviation Administration, Mr. Ma Junsheng, a member of the Leading Party Members' Group of the Ministry of Transport and director of the State Post Bureau, and Mr. Yang Yudong, vice minister of the Ministry of Transport and director of the National Railway Administration. I'm Hu Kaihong, spokesperson of the State Council Information Office. First, please allow me to briefly introduce the background of this white paper.

This is the first time for the Chinese government to issue a white paper on the development of the national transport system. The document systematically introduces the course of development, the overall situation at present and a blueprint for the future. With a total of about 10,000 Chinese words, the white paper is available in several languages including Chinese, English, French, Russian, German, Spanish, Japanese and Arabic. The Chinese and English versions have already been issued by the People's Publishing House and Foreign Languages Press respectively. Now, I give the floor to Mr. Yang.

Yang Chuantang:

Thank you very much for your long-standing interest in and support for China's transport development.

As a basic and pioneering service industry, transportation plays an important role in meeting the people's travel needs and in the country's socioeconomic development. Since the founding of the People's Republic of China, transportation has been greatly transformed and has contributed much to economic growth and people's safe movement. The white paper aims to give an objective picture of China's transport development and introduce its future development goals so that the international community can gain better understanding of China's situation and offer more support. I will now introduce the contents of the white paper in the following five aspects.

First, the Whiter Paper gives a brief review of the development of China's transportation since the People's Republic of China was established in 1949. The gap between the country's transportation and the world's top-level transportation is quickly narrowing. In some fields, China's transportation has even taken the lead.

Second, the White Paper fully shows the status quo of the country's construction of a comprehensive transportation system. As of the end of 2015, a multi-tier railway network had taken its initial shape. China has the world's second longest railway mileage racking up 121,000 kilometers and the world's longest high-speed railway link racking up 19,000 kilometers. The high-speed railway has become a new name card of Invented-in-China, Made-in-China and Go-Globally. China has built an expansive highway network. It has the world's longest expressway distance of 124,000 kilometers and nearly 4 million kilometers of rural highways reaching 37,684 towns and 634,390 villages, with the access rate standing at 99.9% and 99.8% respectively. An inter-connected waterway network has also taken shape. Coastal ports are advanced . The inland waterway navigation mileage stands at 127,000 kilometers, ranking first in the world. There are 31,300 quay berths for production, of which 2,221 berths are above the ten-thousand-ton level. The civil airport system has been basically formed with 210 civil aviation airports in the country. Civil aviation runs at a higher security level. The post service is available in towns and villages throughout the country. China has the biggest express deliveries per year. The oil and gas pipeline network has preliminarily taken shape.

Yang Chuantang:

Major breakthroughs have been achieved in transportation science and technology innovation and application. China has led the world in infrastructure construction technology. The technologies for building high-speed railways, railways in alpine-cold areas and plateaus railways and heavy haul railways lead the world. Technologies for building railways and highways in areas of special geological conditions have solved the world's toughest problems. A great number of world-class large bridges and tunnels have been constructed. Key offshore deep-water port construction technology, giant estuary waterway regulation technology, long-river waterway system management technology and large airport engineering construction technology lead the world. A group of major projects, including the Hong Kong–Zhuhai–Macau Bridge, the Yangshan Port Container Terminal and the Yangtze Estuary Deepwater Channel Regulation have been launched, with some completed and others still under construction. The development of transportation equipment is upgrading and technologies in some fields have the leading role in the world.

Third, the White Paper shows that transportation plays a leading role in economic and social development. The Chinese government insists on giving the development of transportation high priority. Transportation plays a fundamental, guiding and serving role in driving economic and social development, improving services and people's livelihood, and promoting the construction of ecological civilization. It is a clear guarantee, especially for supporting economic growth, promoting coordinated development between regions, urban and rural areas, and helping poverty reduction and elimination.

Fourth, the White Paper introduces the opening-up and international cooperation of China's transportation. The Chinese government has worked hard to boost its connectivity with the world, develop transportation to support its foreign trade growth, play an active part in the international transportation affairs, expand its opening-up in transportation and speed up the globalization of transportation. Now, the Chinese government is enhancing cooperation with the countries along the belt and road to promote the connectivity of transportation infrastructure and the convenience of transportation in an active way.

Fifth, the White Paper puts forward the goals and key tasks of transportation in the next five years. The tasks include: deepening transportation reform in an all-round way; establishing a interconnected transportation network; building modern and efficient inter-city transportation; constructing an integrated and comprehensive transportation hub; promoting pollution-free and intelligent development of transportation; improving the transportation safety management.

Now, my colleagues and I would like to take your questions.


Secretary Yang, based on your introduction about the white paper, I want to put forward some questions as follows: What have we achieved in the construction of the comprehensive transportation system over the past years? How does it promote China's economic development? In addition, what is the development plan in the 13th Five-Year Plan?

Yang Chuantang:

All the transport departments and regions have been proactively working on developing modern comprehensive transportation, implementing the decisions and deployment made by the CPC Central Committee and the State Council and have made great strides since the 18th National Congress of the CPC in 2012. The achievements are as follows: breakthroughs have been achieved in institutional reform; the national infrastructure network has taken shape; and the transportation capacity has been greatly enhanced.

During the 13th Five-Year Plan period, China's transportation will improve in terms of quality and efficiency, build a solid basis for the completion of a comprehensive well-off society and make full use of opportunities in the modernization drive. The main tasks are as follows: firstly, to enhance the layout of a comprehensive transportation system by designing and constructing large-scale passages running east-west and south-north and also connecting China with foreign countries; secondly, to set up three networks, namely, the high-speed transport network with high-quality services, the high-efficiency integrated artery network offering good services, and the wide-ranging integrated basic service network with great benefits coverage; third, to enhance the layout of comprehensive transport hubs by focusing on upgrading international comprehensive transport hubs like Beijing, Shanghai and Guangzhou, accelerating construction of state-level comprehensive hubs, proactively building up regional ones and developing ports; fourth, to step up integrated transportation system development so as to propel the implementation of national plans like the Belt and Road Initiative, the joint development of the Beijing-Tianjin-Hebei Region, development of the Yangtze River Economic Belt, poverty alleviation and new-type modernization; fifth, to promote the development of multi-modal transport of goods and passengers; sixth, to carry out the intelligent reform of the transport industry by promoting the integration of information technologies with comprehensive transportation so as to improve service quality. Those are the main tasks in the six aspects.


Economic Daily:

Secretary Yang, many businesses still hold that China's logistics costs are very high. What is your view? What efforts has the transport department been making to lower costs? What achievements have been made?

Yang Chuantang: Over the past few years, the Ministry of Transport has attached great importance to the development of the logistics industry and has made great progress by releasing preferential policies and implementing pilot programs. For instance, in August, the ministry released a document entitled "Several Suggestions on Accelerating Supply-side Structural Reform and Promoting Cost Reductions in the Logistics Industry." Lowering costs, both administrative and practical ones, is a daunting task. We'll make efforts in the following four aspects in the next phase: firstly, to step up logistics passage development, accelerate construction of freight hubs and logistics parks, and enhance collection and distribution functions of ports and large-scale logistics parks so as to provide a solid basis for logistics development; second, promote construction of a logistics public information platform and encourage businesses to employ advanced technologies to improve efficiency and lower costs; third, to promote multi-modal transportation, and drop-and-pull transport, and promote standardization so as to improve the level of systemization; fourth, to break down policy barriers in key sectors, develop "internet plus" transport logistics and give fresh impetus to the industry.

Bloomberg News:

My question is for National Railway Administration. Can you tell us something about the plans to improve the financial situation of National Railway Administration, such as, through land development or asset securitization? Also, are there any plans to raise ticket prices to cover the costs of freight transport? Thank you.

Yang Yudong:

The National Railway Administration, which was established after being separated from the commercial sector, is the government department responsible for the supervision and management of railway operations. During the past few years, China's railways, especially the high-speed lines, have developed fast, thanks to the smooth operation of investment and funds operation in the entire system. During the 12th Five Year Plan, we invested 3.58 trillion yuan (US$515 billion) in building railways, with a length of 30,000 kilometers. Currently, the operational mileage has reached 124,000 kilometers as the high-speed railways in particular have now surpassed 20,000 kilometers, accounting for about 65 percent of such operations in the world.

During the 13th Five Year Plan, we will continue to accelerate construction and development. We plan to invest 3.5 trillion yuan in the sector, so that, by the end of the 13th Five Year Plan, the entire rail operational mileage can reach 150,000 kilometers, including, 30,000 kilometers of high-speed lines. In doing so, we prioritize the relationship between railway investment and construction. The CPC Central Committee and the State Council attach great importance to railway construction, issuing supportive policies and dividing investments into different sections. In doing so, we encourage the introduction of diverse capital from local governments, enterprises and various entities for urban, suburban, freight and subsidiary railways, in addition to the arteries involving investment and being operated by China Railway Corporation. The categorized investments can better serve railway construction.

At the same time, the State Council has issued preferential policies to railway business entities, especially China Railway Corporation, which can make full use of designated lands for comprehensive development. China Railway Corporation has 600,000 hectares of land, among which a considerable proportion is expected for comprehensive development. Meanwhile, the profits gained from land comprehensive development will be invested in improving business efficiency or railway construction.


Yang Yudong:

Thirdly, the relevant administrations in the country will give full play to the railway enterprises that enjoy certain freedom in fixing prices for some passenger transport services. However, the central government will continue to keep control of the prices of hard seats on ordinary trains in a bid to ensure the affordability of travel for ordinary Chinese. The railway transport enterprises will adjust the ticket prices in view of the changes of markets and regional economic conditions. The adjustments are influenced by two factors: First, people's interests. Train ticket prices should not be increased as to be beyond people's reach, and our primary task is to ensure the benefits of reform and opening up are shared by all the people. Second, market conditions. The prices should be fixed based on the actual conditions of the market as well as the enterprises' own performance because price fluctuations can enable the railway companies to act as market entities, adapting to market and gaining profits. The country is now issuing railway construction bonds while encouraging diverse funding channels, such as the Public-Private-Partnership (PPP).

On July 13 2016, China amended "The Medium-and-Long-Term Railway Development Plan", under which the time span is stipulated as being between 2015 and 2025; there is also a forecast up to 2030. In accordance with "the Plan", the railway operational mileage is expected to reach 175,000 kilometers, with 38,000 kilometers of high-speed rail, by 2025. By 2030, the entire railway length is expected to reach 200,000 kilometers, 45,000 kilometers being high-speed lines.

That's my introduction, thank you.

China Youth Daily:

My question is for Mr. Feng. This year, several civil aviation incidents occurred in our country, which attracted wide attention from the public. What's the current safety level of China's civil aviation? What did the CAAC do for the country's civil aviation security? Thank you.

Feng Zhenglin:

Thanks for your question, which points out the baseline we should hold. This year, the transport turnover, passenger volume, and cargo traffic increased by 12.6 percent, 11 percent and 5.5 percent, respectively. With the largest transport turnover increment and the highest growing rate of flight frequency, we ensured that the entire security situation of civil aviation maintained stable and that no flight accident or aviation security accident occurred. We have witnessed 45.96 million hours of safe flight this year. Till now, Chinese civil aviation has guaranteed 14 continuous years of aviation security.

In the past 10 years, Chinese civil aviation has seen millions of flights and the major accident rate of 0.036 was one-twelfth of the world standard during the same period. We can say that China's aviation safety is under control and China has already formed a systematic safety management system, operation, supervision and control system. However, although the situation is general stable, there is still risk and worry. As you mentioned, on May 1 of this year, China Eastern Airlines Sichuan Branch's airplane A319/B-6430, which was flying from Chengdu to Kangding, failed to touch down within the runway at the Kangding Airport. On Oct. 11, when a China Eastern Airlines A320 was about to take off at Shanghai's Hongqiao airport, another jet, an A330, was taxiing across the runway. After the two incidents, we issued the most serious punishment to relevant officials and staff according to law and procedure.

At present, China's civil aviation industry is in a golden era of rapid development, but the contradiction between transport demand and supply quality has become serious. The daily flights of some regions and airspace have already become some of the busiest worldwide. The growth of aviation transport in some regions has already touched the "ceiling" of airspace resource, ground maintenance and human resource. To solve these problems, we should promote supply-side structural reform in the civil aviation industry, take meeting needs as the ultimate target, increase efficient supply, improve safety development and enhance quality of air service.

Following President Xi Jinping and Premier Li Keqiang's requirements on civil aviation safety, we will deal with the relations between security and development, security and efficiency, security and normal, security and service. We are building a "zero tolerance" long-term mechanism for comprehensively check and rectification, doing everything possible to improve aviation management, airport, operational control and human resource management. Through our work, we will help the public have a safe flight and journey. Thank you.

China National Radio:

My question is for Mr. Ma of the State Post Bureau. The express delivery sector has grown rapidly in recent years. However, there are problems like low service quality, stereotyped development mode and unbalanced regional development. What will you do to promote a healthy and balanced development? Thank you.

Ma Junsheng:

As you say, China's express delivery industry has grown rapidly. The number of parcels being handled, ranking first in the world, has achieved growth of more than 50 percent for six straight years. Of the 70 billion parcels handled by express delivery service worldwide every year, 30 billion are in China.

Why has there been such rapid growth? There are three reasons.

The first reason is reform of the postal system, which greatly unleashed productivity, stimulated market demand and narrowed the gap between demand and supply.

Another reason is coordination with the e-commerce industry. Every day, nearly 100 million parcels are delivered in China. Of them, over 60 percent are from the e-commerce industry. Through coordinated development, the two sectors provide excellent service to the Chinese people.

The third reason for growth is innovation, which has created a good service mode. Just now, Mr. Yang talked about improving the business performance by lowering costs. The express delivery industry has made noticeable progress in this regard. Ten years ago, a parcel usually cost 30 yuan. Today, it's fallen to only 12.8 yuan, one-fifth the world average level. Since we are able to handle 30 billion parcels at a much lower price and improved service, it's no wonder people love to use our service.

Of course, there are problems, such as low service quality, stereotyped development mode and unbalanced regional development, as you mentioned. We are aware of these, and have been working to solve them. Specifically, we have taken five measures as follows.

First, boosting the growth of market entities, especially high-level, large-scale companies. In the world, only 14 express delivery and postal companies are able to handle over 10 million parcels a day. Six are based in China. We have been doing well in terms of quantity, so we now shift our focus to quality as the next step.

Second, promoting innovation and coordination, making wider use of information technologies, and creating more innovative business and service modes, and better management, so as to diversify our services and products.

Third, promoting business development in rural areas, the western regions and overseas to improve our service network. Today, express delivery service is available in 80 percent of rural areas. In 2020, the figure is expected to reach 100 percent. We will open new channels to help move more industrial products to the countryside and bring more agricultural products to the cities. We will strive to stimulate rural consumption.

Fourth, building a comprehensive transportation system and promoting wider use of planes, automobiles and boats to improve delivery efficiency.

Fifth, carrying out various projects to intensify oversight and supervision.

These are the five aspects we will focus on in the future. I firmly believe that, by 2020, we will establish a highly efficient and reliable express delivery system that can cover every corner in China and reach overseas markets.

Yang Chuantang:

Please allow me to express my view on this issue. Since the 18th CPC National Congress, the express delivery industry has been growing by more than 40 percent annually. During an inspection tour, Premier Li Keqiang said the industry had become a "dark horse" in China's economic development. In my view, the "dark horse" needs to keep up its momentum, so as to play a bigger role in lowering costs and serving the people.


I'm from Reuters. I just want to ask a question about restrictions on overloaded trucks. China [introduced] new regulations last September; however, this month, Jilin Province relaxed these regulations allowing truck drivers to overload their trucks by several tons because of blockages in the supply system. How is this policy playing out so far, and has it affected or put more pressure on the railway system as well?

Yang Chuantang:

It has been 12 years since China began to deal with this overloading issue. In that time, we have seen achievement as well as some setbacks. Since September this year, we organized the related departments to set up new standards and measures. In Henan Province, for instance, after two years of work, its overload rate has been cut to just three percent. And some other provinces may have similar low rates. Admittedly, there are regional imbalances -- some provinces may have tight regulations while others are not so strict. You raised the question about the different standards in different provinces and in different time periods, which we have noticed and are currently working on. We will, and must, follow the standards for the sake of safety and the sound development of road infrastructure. Much needs to be done in dealing with overloading, and we must accelerate our work. Thank you.

Phoenix TV:

The 2017 Spring Festival travel rush is around the corner. Train tickets for Chinese New Year's Eve are on sale today if I'm not mistaken. The Ministry of Transport pledged as early as 2009 to increase the transport capacity to resolve the difficulty of buying tickets during peak periods. However, people are still complaining about the difficulty of getting a ticket. Another thing is that the number of regular trains, express trains (T trains) and direct express trains (Z trains) is decreasing, which many people have been complaining about. Regarding high-speed railways, those in east China, especially the Beijing-Shanghai line, is making profits. But in central and west China, high-speed railways, for instance the Zhengzhou-Xi'an line, is still far from making a profit despite being launched in 2010 -- earlier than Beijing-Shanghai. We don't know when these lines will begin making profits. Therefore, people are also talking about whether it's necessary to modify the ideas behind building high-speed railways. Will there be any changes? Thank you.

Yang Chuantang:

You talked about two problems. One is the difficulty of getting tickets during the Spring Festival travel rush and the other is the regional imbalance in the train system. This year's travel rush begins earlier than usual, and will experience record traffic volume and greater demand. We expect the coming Spring Festival will see 2.978 billion passenger journeys, 2.2 percent up year on year.


Yang Yudong:

I'll add up some further points. First, this year's travel rush will be better organized than previous years. There will be a new train diagram from January 5. A total of 3,570 pairs of passenger trains will be provided, increasing the traffic capacity by 7.5 percent and 7.1 percent respectively before and after the Spring Festival compared to last year.

Second, people may think that the Spring Festival experiences the largest travel rush. In fact, there is more rail traffic during the May Day and National Day holidays. This year, the National Day holiday saw a record number of 14.417 million people traveling by train in one single day, much higher than in the Spring Festival. As we have handled 14 million people during the National Day holiday, we can handle the same in the Spring Festival.

Third, the launch of new electric multiple units (EMUs) began October 1 this year and will be completed by January 31 next year. As I learned yesterday, at least 90 EMUs will be added, which can enable an additional 200,000 people to travel every day. We can see that this year's travel rush will be better handled than in previous years.

As to high-speed railway and regular trains, we have not only increased the capacity of EMUs, but also increased the number of regular trains to enable ordinary citizens, especially low-income ones, to travel back home for the Chinese New Year.

As you mentioned just now the high-speed rail in western regions has not made any profit so far. I think you should look at it this way: First, the construction projects of railways, whether it is normal rail or high-speed rail, are significant infrastructure projects for the nation. The newly built high-speed rail projects initially started operation in 2008. As an infrastructure project, it needs a long time to recoup its investment and also needs a long time to nurture the market. We are very happy to see that a big part of high-speed railways in eastern regions have started making profits after several years of developing. We believe that the rails in western regions will also break even after years of operation.

Speaking from another perspective, as a part of the strategy to develop China's western regions, the construction of the railways should be extended to the central and western regions, which will help implement the nation's strategies.

So, looking at the big picture, the western railways must be built and must be built expansively. It is not just a question of the rail companies profiting, but also about how to drive the comprehensive development of Chinese economic society.

People's Daily:

Mr. Yang, in recent years, the central government has attached great importance to the Belt and Road Initiative. One big part of the initiative is the connectivity of transportation infrastructures and the convenience of international transportation. What progress we have made recently? What projects have been implemented, and what projects could be expected?

Yang Chuantang:

The Ministry of Transport has been actively pushing forward the connectivity of transportation infrastructures among countries along the Belt and Road (the Silk Road Economic Belt and the 21st-century Maritime Silk Road). We follow the principles of wide consultation, joint contribution and shared benefits, and work hard on the following aspects.

First, intesify the connectivity of technical standards on transportation infrastructure construction of the countries along the Belt and Road, so as to build regional transportation infrastructures networks fitting those countries' needs; second, strive to form complex three-dimensional transportation infrastructures backbone networks; third, gradually form and adapt to standard transportation rules and convenient customs clearance procedures and specific approaches; fourth, improve the construction and cooperation in human resources with countries along the Belt and Road.

In general, during the process to push forward the connectivity of transportation infrastructures, we must follow President Xi Jinping's instruction to promote the connectivity of hardware, software and culture.

The railway, as strategic transportation infrastructure, is important to the initial development of the Belt and Road Initiative. With the joint efforts from relevant state departments, railway enterprises and other forces, the railway "go global" plan has made good progress. China is building railways for Indonesia, Laos, Hungary and Serbia, while there are also light-railway projects in Pakistan and railway projects in Africa, and Brazilian subway systems. China's railway technical equipments have been exported to many countries around the world. China-Europe CR Express has become a major brand for the Belt and Road Initiative. It now has 39 railway lines that can reach 13 cities in eight countries. This year we have the trains running 1,685 times, a 107 percent increase year on year. We will play an active role in the development of the Belt and Road Initiative and benefit the people in countries along the routes. Related works are underway. Thank you.

Feng Zhenglin:

While facilitating the "Belt and Road" Initiative, overseas cooperation in China's civil aviation is also expanding. We have already established flights with 43 countries of the 65 countries along the belt and road, and there will be more.

Yang Chuantang:

This is the first time that the main leaders from the Ministry of Transport, the Civil Aviation Administration of China, the State Post Bureau of China and the National Railway Administration of China have held a press meeting here. It marks that the establishment and the improvement of our national comprehensive transportation system and mechanism has entered into a new stage. This is the first joint press meeting. We will have a second one, a third one and more in the future. Thank you.

Hu Kaihong:

The spokesman of the Ministry of Transportation Mr. Xu Chengguang is also present today. He will be available if there are more questions. Now the press conference ends. Thanks for the presence of the four ministers. Thank you to all our friends from the press. See you next time.

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