China’s love affair with high-speed rail is a boon to foreign suppliers—for now

IN SHARP contrast to the usual smooth collaboration between political and business interests in Hong Kong, thousands of protesters are expected to surround the territory’s legislative council on January 15th. They are hoping to deter the councillors from approving funding for the final 16 miles (26km) of one of the world’s most ambitious infrastructure projects, a high-speed rail network linking one end of China to another. They think it is too expensive, will involve the forced purchase of too much private property and will demolish too much of the territory’s heritage.

The same may be true of the rest of the epic project to expand China’s rail network by nearly 19,000 miles by 2015, 8,000 of which will be tracks for high-speed trains. But the media, at any rate, portray it as a point of national pride and as a huge stimulus to the economy and employment. While Hong Kong grumbles, nothing is allowed to impede this $750 billion civil-engineering juggernaut on the mainland. Indeed, last year it accelerated and, according to Jiong Shao, an analyst with Nomura Securities, the high-speed portion of this network should be finished by 2012, three years early. Urban metro lines will also expand dramatically from 620 miles to 2,800 over the next ten years, as the number of cities boasting such systems doubles from 11 to at least 22. …