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MTR, the Hong Kong metro rail company, is holding discussions with Beijing about operating two lines in the Chinese capital, including a high-speed rail link to the new international airport. Jay Walder, chief executive of MTR, told the Financial Times that the rail company had also been chosen as “the potential foreign investor” to operate another line in Shenzhen, the southern Chinese city across the border from Hong Kong.

 

MTR, which is 77 per cent owned by the Hong Kong government, already operates five metro lines in the Chinese cities of in Beijing, Shenzhen and Hangzhou, and runs subways in Stockholm and Melbourne.

 

It is also considering a bid to operate part of the S-Bahn underground network in Berlin, and it runs London Overground in partnership with Deutsche Bahn.

 

With limited ability for further expansion in Hong Kong, MTR is making a push in China where rapid urbanisation is likely to generate huge demand for public transport, particularly as the country faces big environmental challenges. McKinsey, the consultancy, estimates that China’s urban population will grow by more than 350m by the end of the next decade, creating more than 200 cities populated by more than 1m people.

 

“We have never seen urbanisation on this scale,” Mr Walder said. “[China understands that] cities of the size, scale and density that are implied?.?.?.?have to be build on the foundation of public transport.”

 

China plans to install subways in 40 cities by 2020, up from slightly less than 20 at the moment. Mr Walder said MTR was also holding talks with a “number of other cities, some out in the western part of China”, but said it would take a cautious approach to protect its brand.

 

“You will see us only in two or three more cities [in China],” said Mr Walder. “I don’t think our goal should be to stretch across to a vast number of places.”

 

In a recent speech, Mr Walder said MTR delivered 99.9 per cent on-time performance in Hong Kong, and that it was “one of only a handful of urban passenger rail companies” to make a profit.

 

In the first six months of this year, MTR increased revenues by 12 per cent year on year to HKD 19.2bn (US$2.5bn), and reported an underlying net profit of HKD 4.3bn, a rise of 5.1 per cent. That included a profit of HKD447m related to property development, which marked a 15 per cent year on year contraction.

 

Mr Walder said MTR was well placed to expand in China because planners now preferred a model that requires closer integration of rail and land development. In Hong Kong, MTR operates the metro lines, but it also develops properties above or near stations, as part of a deal with the Hong Kong government.

 

“In the mainland, there has been a shift to integrating this more closely than might have been the case a decade ago,” said Mr Walder. “This is what we do so well – the integration of the metro and the land use that takes place above.”

 

In Shenzhen, MTR is in talks to run Line 6, which is envisioned as a “rail and community” project, similar to the model that MTR employs in Hong Kong.

 

Patrick Xu, a transportation analyst at Barclays, said MTR would also gain from the fact that many Chinese local governments prefer to use private-public partnerships to lower upfront costs that would strain their already stretched balance sheets.

 

“MTR has been successful with this model in Hong Kong,” said Mr Xu.

 

In addition to the line to the new international airport in Beijing, MTR is holding talks with the municipal government about operating Line 16, which will serve the west of the capital. Both projects are expected to be awarded without public tender.

 

Mr Walder, who was previously a top Transport for London executive, said MTR hoped to win three tenders in London that it has been shortlisted for the Essex Thameside and Thameslink franchises, and the new ￡14.8bn Crossrail line.

 

“We are working hard on the bids,” said Mr Walder. “We are already seeing what we can do in London by seeing the quality of the London overground.”

 

Mr Walder said that MTR’s “biggest calling card” was that it has proved in Hong Kong that it can perform all aspects of rail development, from design and construction, to running a network and maintaining the assets.

 

“Our skill sets are tightly aligned to what they will need in the UK.”

 

 

 

 

 

The government will turn its attention to building the US$7 billion Boten-Vientiane railway, to link the Lao capital with the Chinese border, according to the government spokesperson.

 

Speaking at a media conference following the government's open meeting that ended on Friday, Ms Bounpheng Mounphosay said the five-day meeting had adopted an infrastructure development strategy on land, air and water transportation.

 

Regarding rail development, the strategy prioritises the development of a rail network to connect with others in the region and sub-region.

 

“Our particular focus is to build a rail link between Boten and Vientiane,” Ms Bounpheng told the conference. Ms Bounpheng's announcement comes shortly before the planned visit to China by President Choummaly Sayasone.

 

Choummaly, who is also Secretary General of the Lao People's Revolutionary Party, will pay an official visit to China from September 26 to 30 in response to an invitation from his Chinese counterpart Xi Jinping.

 

The topics slated for discussed by the two presidents have not been identified, although Vientiane is reportedly seeking financing from Beijing to build the 421 km high-speed railway.

 

Chinese ambassador to Laos Guan Huabing said last week his government attaches great importance to working with Laos to develop the railway.

 

The ambassador made the comment during an interview with Chinese and Lao media at the embassy in Vientiane ahead of China's National Day on October 1 and President Choummaly's visit to China.

 

Guan said “The determination of the Chinese government to push for the construction of the railway remains unchanged.”

 

He said both sides were looking at the details as they explore a win-win form of cooperation. Construction of the Boten-Vientiane railway was delayed following changes to the initial joint-venture plan between Vientiane and Beijing.

 

Laos and China planned to jointly undertake the project, with China to put up 70 per cent of the investment cost. A groundbreaking ceremony was planned for 2011 with a completion date in 2015, but the ceremony did not take place.

 

The project was delayed after the Chinese construction company reportedly pulled out. However, the Lao government is determined to bring the project to fruition and still hopes to obtain financing from Beijing following parliament's approval.

 

The planned railway would form part of the Asean-China rail link, which begins in Yunnan province, China, and runs southwards to Singapore through Laos, Thailand and Malaysia. The Lao government wants to build the railway as part of efforts to turn the landlocked country into a land link within the region.

 

In November last year, the government signed a contract with a Malaysian investor to build a US$5 billion railway linking Savannakhet province to Laobao on the Vietnamese border over a distance of 220km.

 

Laos' only existing rail link consists of a 3.5 km track linking Vientiane to Nong Khai province in Thailand.

 

 

 

 

 

 

The "oil via rail" game has been a big winner for oil and gas producers across North America. So good, in fact, that CNOOC is trying to get Canadian National Railway (NYSE: CNI ) to to move more than 500,000 barrels per day out of Alberta to export terminals on the West Coast of Canada. To many, this shouldn't be too much of a surprise. After all, CNOOC did just make a big oil sands acquisition earlier this year.

 

The release of this move raises many questions. Will oil via rail meet the same type of political opposition as pipelines? How much will this affect Enbridge (NYSE: ENB ) and Kinder Morgan Energy Partners plans to build pipelines for oil sands exports? Could this be the breakthrough in demand that Canadian oil sands producers Suncor (NYSE: SU ) and Canadian Natural Resources (NYSE: CNQ ) have been begging for? Fool contributor Tyler Crowe ponders all of these questions in the video below.

 

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Millions of Chinese have been bitten by the travel bug. Now, those bites may have become literal. Concerns about bedbugs invading China’s railways are gaining steam among social-media users, local media and local authorities after one user on China’s Twitter-like microblogging platform Weibo reported finding visible bedbugs on a train that travels between Shanghai and Beijing. The user posted a videoof the bugs in late-August, which has since gone viral.

 

Passengers wait to board a train in Chengdu. Authorities such as the Qidong Security Bureau in China’s coastal Jiangsu province are warning travelers of the potential problem, suggesting they wash clothing frequently and check their luggage for bugs to prevent carrying eggs home and otherwise spreading any infestation.

 

Officials in Shanghai aretelling travelers to soak clothing in boiling water to kill any possible adult bugs and eggs.

 

A spokesman for the Shanghai Railway Bureau declined to comment on the alleged problem, saying, “We do not manage this.”

 

The bedbug scare is hitting China’s railways amid a peak travel season. Next week millions of Chinese will celebrate the weeklong national holiday by traveling across the nation to visit family and friends or explore other cities and towns, and trains are one of the most popular transportation methods.

 

Bedbugs, brown or red parasites that feed off human blood and can grow to the size of an apple seed, can leave bite marks or welts and spread easily by hitching a ride on clothing or other belongings. High-traffic places put humans at the highest risk of encountering the bugs, which are not believed to carry disease but can cause physical and psychological problems.

 

Widespread use of insecticides in the 1940s was believed to have wiped out the pest in the U.S., but bedbugs made a comeback and infestations have plagued big cities in recent years. Cities like New York have been fighting the problem for years. An epidemic in 2010 was so bad that the pests spread to movie theaters, the United Nations and tourist hot spots like the Empire State Building, while retailers Abercrombie & Fitch and Victoria’s Secret were forced to temporarily close some outlets.

 

China’s railway policy is to change the bedding on trains after each journey. Yet many social media users question whether that policy is always followed.

 

“Change the bedding per passenger? I saw the quilt crinkled so many times when I entered (the carriage),” one Weibo user said.China on track to rail link with neighbors “Can you at least change per year? I am afraid that you may never change it,” said another.

 

Others said worries about bedbugs may deter them from traveling by rail during the coming holiday. “I planned to travel by railway, but now I dare not do that in case I got bugged,” said another user based in Beijing.

 

 

 

 

China has been steadily pushing rail to connect the world's second-largest economy with its neighbors in Southeast Asia, and it is taking a practical approach to realizing the goal, industry insiders said.

 

Three lines that link Yunnan province to Southeast Asian nations have been included in China's medium- and long-term railway network plan and preliminary work has begun, according to sources close to China Railway Corp, the successor of the dissolved Ministry of Railways. According to the plan, the lines start in Yunnan's capital Kunming and will connect Laos, Vietnam, Cambodia, Myanmar, Thailand, Malaysia and Singapore. They constitute the southern part of the ambitious Trans-Asian Railway that was initiated in the 1960s and began to take shape after 18 countries signed an agreement on the rail network in November 2006.

 

The huge network aims to provide a continuous 14,000-kilometer rail link between Singapore and Istanbul in Turkey, with possible onward connections to Europe and Africa, according to the United Nations Economic and Social Commission for Asia and the Pacific.

 

Despite a blueprint for the three lines, surveying and construction work have been hampered due to funding difficulties and disputes over speed.

 

Responding to some nations' concerns on funding, China has pledged to offer financial support for the construction.

 

The Export-Import Bank of China has agreed to provide loans for the construction of a rail line that will link border cities in Yunnan to Laos' capital Vientiane, the Vientiane Times quoted Laotian Deputy Prime Minister Somsavat Lengsavad as saying.

 

He said the railway will be about 420 km long, and the cost of construction is estimated to be about $7 billion.

 

In China, railway planners previously set the average speed of the three lines at 200 km/h, which was later opposed by many experts who argued it would be difficult and economically unfeasible for these lines, the 21st Century Business Herald wrote, quoting an unidentified employee with China International Engineering Consulting Corp.

 

The speed for some sections was adjusted to 120 kmph after several rounds of discussions, the report said.

 

A crucial section of the eastern route, a line linking Yuxi to Mengzi - both in Yunnan - began operations in April, and the Mengzi-Hekou railway is also expected to start operating by the end of 2014, which will complete the eastern route, according to the Kunming Railway Bureau.

 

The survey for the central route, which runs through Yunnan, Laos, Thailand, Malaysia and Singapore, is also underway, it said. Chinese officials said during the 10th China-ASEAN Expo, which was held in the Guangxi Zhuang autonomous region in September, that China will accelerate infrastructure projects in road and rail that connect the country and its Southeast Asian neighbors, including the Trans-Asian Railway.

 

"The rail lines will significantly boost the development of China's southwestern region and Southeast Asian nations," said Zhao Jian, a professor at Beijing Jiaotong University who specializes in China's rail system.

 

"Geographical and weather conditions in these nations are like those in China's southwestern region, so Chinese technicians and engineers should have no problem in designing and building railways there."

 

However, Zhao suggested that technologies used in these lines should not be too complicated due to costs and the countries' capacity to maintain sophisticated rail equipment.

 

"Likewise, I don't think these railways necessarily need to be high-speed lines," he said.

 

 

.

 

 
 

Li Keqiang's comments that China was interested in helping build high-speed lines in Thailand sends shares up, some to the daily limit.

 

(Beijing) – Stockholders sure like the idea of Thai rice for Chinese rails. Stocks related to China's railroad industry surged on October 14 after Premier Li Keqiang pledged Beijing's cooperation in high-speed railroad projects in Thailand.

 

Li's comments, made on a visit to the Thai capital Bangkok, raised the stock market's hopes that Chinese railroad companies will get more deals in the Southeast Asian country.

 

While attending an exhibition dedicated to China's relatively new high-speed railroads in Bangkok with Thai Prime Minister Yingluck Shinawatra, Li also said he hoped the two countries could cooperate on projects that used equipment exported from China.

 

Some 31 companies engaged in building infrastructure saw their stock prices jump by an average 6.04 percent on the Shanghai bourse. Ten firms related to high-speed railroads, including major train manufacturer China South Locomotive and Rolling Stock Corp. (CSR), China CNR Corp. and Jinxi Axle Co., had their share price surge to the 10 percent daily limit.

 

China and Thailand signed a memorandum of understanding on October 11 regarding cooperation in railroad development. China said it would seek to participate in a high-speed railroad project linking northeastern Thai city of Nong Khai and Phachi, a district of Ayutthaya Province, which just north of Bangkok.

 

Some of Thailand's payments for the projects would be in the form of agricultural products, including rice.

 

CSR said it is preparing to set up a center with research institutions in Thailand to engage in research and development, testing and certification, and talent training.

 

The partnership with Thailand would provide a boost for China's high-speed railway industry, which has suffered a slowdown since 2011 when a deadly train crash triggered an industry-wide inspection and the exposure of a network of graft.

 

That corruption has led to a slew of trials and one ended in July with a lengthy jail term for the former railroad minister, Liu Zhijun.

 

So far, Southeast Asia is the main market for China's rail equipment exports, but deals have also been signed with partners in Central Asia, South America, Australia and Africa. Exports include locomotives, cargo and passenger cars and other parts. However, none of China's train makers has exported a whole high-speed train to another country.

 

A CSR source told China Business News that Chinese companies have become major suppliers to the railroad market in Thailand, which is planning several high-speed lines across the country.

 

In June and July, CSR won bids for two locomotive contracts in Thailand. CNR has exported subway equipment to the country.

 

However, analysts say Chinese train makers are simply equipment providers and generate little profit from after-sales services and maintenance. Both CSR and CNR have made efforts to improve their after-sales service in overseas markets by setting up subsidiaries that perform maintenance and repair services.

 

In September, CNR signed a contract to sell eight diesel locomotives to New Zealand KiwiRail Holdings Ltd. The companies also signed a maintenance contract for one of the locomotives, the first such product and services contract clinched by a Chinese train maker with a customer in a developed country.

 

A source from CNR said China still relies on imports for many major parts in high-speed trains, such as wheels, bearings and electricity systems. This was due to limited research capacity.

 

However, the source said Chinese companies outperformed many international counterparts in building lines.

 

 

 

 

It’s only been in service since 2007, but China’s high-speed rail network is already causing major changes in how people move throughout the country.

 

In a fascinating overview of the system, New York Times lays out some impressive statistics. Not only do the high-speed trains serve twice as many passengers per month as China’s domestic airlines, but, with strong passenger growth continuing, the number of monthly passengers on the network (54 million) will surpass monthly domestic airline passengers in the United States, the world’s largest domestic air market, next year. And while it comes at high costs, the rail network is making workers more productive and transforming the way business is done, Keith Bradsher reports:

 

Companies are opening research and development centers in more glamorous cities like Beijing and Shenzhen with abundant supplies of young, highly educated workers, and having them take frequent day trips to factories in cities with lower wages and land costs, like Tianjin and Changsha. Businesses are also customizing their products more through frequent meetings with clients in other cities, part of a broader move up the ladder toward higher value-added products.

 

High-speed rail has become a popular transit option throughout China because it’s fast and reliable

 

The new dmus will replace ageing locomitve-hauled trains on the Belgrano Sur network. Keith FenderTHE government of Argentina has placed an order with China Northern Rolling Stock (CNR) for 27 three-car metre gauge dmus, which will be used on commuter services on the metre-gauge Belgrano Sur network in Buenos Aires.

 

The order, which will largely be financed through loans from Chinese banks, was announced during a visit to CNR facilities in China by Argentina's transport minister Mr Florencio Randazzo in early October.

 

The trains will be delivered between October 2014 and February 2015 and will operate in multiple during peak periods.

 

A further order for 32 three-car dmus for the non-electrified sections of the 1676mm Mitre and Sarmiento networks will be placed in the near future and tenders have been sought from Chinese suppliers.

 

Both CNR and CSR have won major contracts in Argentina in recent years as the government plans to renew almost all commuter rail equipment over a five year period. Both Chinese companies are planning to establish assembly facilites in Argentina.

 

Operation of the Belgrano Sur service had been the responsibility of the UGOFE private consortium of train operators, which replaced the previous private concessionaire Metropolitano in 2007. In August the government announced that state-owned operator SOFSE would take over operation of the line within three months.

 

 

 

 

 

 

Sweden's LKAB opened its newest and deepest excavation level at its iron-ore mine in Kiruna in May, which is using an automated railway to move extracted iron-ore. Kevin Smith travelled 145km into the Arctic Circle and 1365m below the surface to visit the mine.

 

KIRUNA is a city on the move, quite literally. Built to serve and house the workers of Europe's largest iron-ore mine which towers over the city, continual excavation is affecting its foundations so much that the city is planning to relocate many of its major buildings before they are gobbled up by a huge sink hole.

 

The railway line, which runs north to Narvik in Norway and south to Lulea on the Baltic Sea, has already been relocated, meaning that trains entering the city from the south actually do so from the north. And with excavation continuing apace, further relocations are now essential.

 

Indeed Luossavaara-Kiirunavaara AB (LKAB) completed a SKr 12.5bn ($US 1.93bn), eight-year project to open up the mine's seventh excavation level earlier this year which guarantees operations will continue in Kiruna for at least another 20 years. Located 1365m below the original surface point of the mine which opened in 1888, production will slowly be ramped up in the next few years as excavations at the previous level, 1045m below the surface, simultaneously decline.

 

The project is LKAB's largest single ever investment, and Mr Hans Engberg, the company's general manager for projects, says full capacity at 1365m will be reached in 2017. At this point the mine will produce 100,000-110,000 tonnes of iron-ore per day with an annual capacity of up to 35 million tonnes, which is an increase from the mine's current capped output of 30 million tonnes.

 

An automated railway, as it did on the previous excavation level, is moving ore from the excavation point to a compressor where the ore is crushed before being hoisted to the surface.

 

"We performed a life-cycle cost analysis of five potential options, but a railway was preferred because we had to locate the compressor 1.2km away from the excavator due to potential stresses in the rock in that area," Engberg says. "The railway is the most efficient way of transporting ore over this distance."

 

LKAB is a 24-hour operation, with blasting taking place between 00.00 and 06.00, and extraction and removal from 06.00-00.00. A maze of dimly-lit road tunnels which descend at 10o°connect the mining levels and facilities in what feels like an underground city akin to Lang's Metropolis. 700 people work underground with air-conditioning maintaining a temperature of around 18oC on the new mining level which contrasts significantly with the often brutal arctic temperatures on the surface.

 

Around 90km of new tunnels were constructed for the new mining level, which required the extraction of more than four million cubic metres of rock. The new level accommodates an operations centre, offices, control rooms, and personnel space, with the deepest part of the mine now 1542m below the surface point.

 

Blasting

 

Once overnight blasting is concluded, the ore is collected by dump trucks which deposit it into 3m-diameter chutes to railway wagons situated directly below. Each train consists of 21 wagons with a combined capacity of 600-800 tonnes. The train is hauled by a locomotive supplied by Schalke, Germany, to a dumping station where it takes 2.5 minutes for the wagons to release their contents through the bottom of the wagon to the compressors situated below. From here the ore is sent to the surface via hoists which travel at 61km/h with each having capacity for 33.4 tonnes.

 

LKAB has installed 12km of track to serve the mine and three of its eventual 10 chutes are currently in operation with two trains in use, serving a single crusher and skip hoist. The track will eventually be extended to 15km to allow the mine to reach full capacity, at which point seven trains will serve 37 shafts, four crushers and five skip hoists.

 

Engberg says 1435mm-gauge was selected for the railway because it was found to reduce spillage compared with the existing 891mm-gauge infrastructure at previous mining levels. Sourcing replacement rolling stock components is also now a lot cheaper.

 

The locomotives are powered by a combination of 750V dc electrification and batteries. Nine production units have been ordered from Schalke and four service vehicles for various functions from Robel, Disab, Geismar and Zephir. Kiruna Wagon, Sweden, is supplying 120 wagons, with an option for up to 22 more, under license from Nordic Mine Technology (NMT), Canada, which supplied the first 21 wagons directly. When the new level is at full capacity seven locomotives will be in service at any one time hauling trains of 21 wagons with 16 wagons left in reserve or undergoing maintenance.

 

LKAB selected Midroc Electro in a contract worth more than SKr 360m in December 2010 to supply process control systems, power supply, electrical installation and control systems for the automated trains for the new mining level. Midroc subsequently subcontracted the railway element to Bombardier which supplied and installed the railway's automated operations system.

 

All of the trains are fitted with ATP while the nine operational trains will also be fitted with an Automatic Train Operation (ATO) system meaning that they are completely driverless. They are also utilising a variation of Bombardier's Interflo 150 CBTC solution which has been specially adapted for mining operations by offering automatic route setting, derailment detection at 42 locations and integration with the mine's ore loading and unloading facilities.

 

A centralised traffic control centre located on the surface manages the interlocking and radio communications for the railway and issues movement authority to the train. It can also provide on-demand operation when required. A second control centre is located in the mine at the production level which is used for redundancy purposes.

 

Moving block

 

Of course the major feature of any CBTC solution is its capability to offer moving block operation. Mr Valentine Paramasivam, Bombardier Rail Control Solution's global head of industrial and mining, says maximising capacity was a priority for LKAB and this is emphasised in the system rolled out.

 

It uses a CAB-display rather than signals to manage movements with 57 EBI Switch machines installed on the railway, and a system of 180 wayside balises used to determine train location. Balises inform the onboard odometer of the exact geographical location of the train, keeping the error in position provided by a tachometer to an acceptable level. In addition train position is reported by the train to the central interlocking every two seconds and not just when it passes the balises.

 

The system can accommodate more than 160 train pair movements per day, far in excess of LKAB's need for 143 with an average load of 650 tonnes which will reach its desired output of 35 million tonnes per year.

 

Paramasivam says LKAB's automated railway is a tried and tested solution having been successfully installed at Codelco's El Teniente copper mine in Chile since 1999. Interflo 150 is compatible with the WiFi radio system used in Kiruna and is adaptable to any radio system used by mines around the world. And with low-bandwidth demand it does not place any additional strain on an operator's network.

 

Paramasivam says that with 11% of the world's existing underground mining operations using railways, there is a strong market for train control solutions that will offer enhanced capacity in an environment where any time saved is money gained.

 

Freeport Indonesia is in the process of expanding operations at its open pit Grasberg gold and copper mine in the Papua Highlands of Indonesia, to a new underground mine where it will build a 28km railway. Midroc secured a SKr 550m contract for operations systems and again selected Bombardier as a subcontractor for the railway element.

 

It plans to install an identical system to that delivered to LKAB in Indonesia. And with miners in Australia, Africa, China and South America similarly exploring how they might improve the efficiency of their operations, and ultimately get more ore for their buck, LKAB is likely to become a reference point for more operations in the near future.

 

10.China shows interest in KL-Singapore high-speed rail project China has expressed interest in participating in Malaysia’s 330km-long Kuala Lumpur-Singa-pore high speed rail (HSR) link project.

 

China President Xi Jinping said the project, together with port development and other connectivity projects, were on top of their overseas investment ventures.

 

He said they were also ready to consider participating in the Nor-thern Economic Corridor development projects.

 

“The Chinese government will continue to encourage Chinese companies to participate in Malaysia’s railway, port and other connectivity projects.

 

“The Chinese government is ready to give positive consideration to participate in the Northern Corridor development projects in the appropriate ways,” he said yesterday at a joint press statement with Prime Minister Datuk Seri Najib Tun Razak after their bilateral meeting at the Perdana Putra Building here.

 

Earlier this year, Malaysia and Singapore announced plans for the rail link, which is expected to cut land travelling time between the two countries to just 90 minutes.

 

The project, targeted to be completed by 2020, is reported to cost about RM40bil. Several local and foreign firms have been reported to have started talks to form consortiums to bid for the project.

 

The firms are MMC Corp Bhd, which may team up with Gamuda Bhd and Chinese and European system integrators and YTL Corp Bhd with Spanish bullet train maker Talgo or CAF.

 

Other firms are UEM Group Bhd, which is working with Ara Group to form a consortium with European companies that may also include Talgo, while Global Rail is said to be talking to Canada’s Bombardier Inc and Chinese firm China Railway Group.

 

Xi said during the bilateral meeting that both governments agreed to maintain high-level contacts and this would help enhance coordination on major issues.

 

“There will be a closer cooperation in defence, law enforcement, security, naval and military exchange, combating terrorism and transnational crime. By doing so, we are going to create a sound environment for the growth and prosperity of both countries,” he added.

 

He said both countries had agreed to actively advance the construction of science lab and expand the training and exchanges among young scientists.

 

He added that both governments would also encourage competent and capable companies to take active part in the space and scientific entrepreneur cooperation.

 

Meanwhile, International Trade and Industry Minister Datuk Seri Mustapa Moha-med said Malaysia was eyeing 5% of China’s US$500bil (RM1.588tril) outbound investments over the next five years.

 

The country is also hoping to attract 5% of the 80 million outbound tourists from China searching for a suitable holiday destination.

 

“With its US$500bil set to flow into other countries, China will be an important investment source for us,” he said at a press conference after the Malaysia-China Economic Sum-mit at the Kuala Lumpur Convention Centre yesterday.

 

Mustapa said China’s huge potential was something that should be looked into by the ministry, Malay-sian Investment Development Authority and Malaysia External Trade Development Corporation.

 

He said China’s investment in Malaysia was less than the other way around.

 

“Currently, China’s investment in our country is only about 10% of the US$6.3bil (RM20.05bil) of what Malay-sia invested in China,” Mustapa said.

 

Asked the reasons for the imbalance, he cited the high speed of development experienced by China.

 

“There are a lot of opportunities for growth there,” he said, adding that Malaysian businessmen were knowledgeable and attuned to the Chinese market.

 

Mustapa said Malaysia hoped that China’s industry players would invest in the services and manufacturing sectors here. On the event, he said eight business projects worth RM9bil were signed with China.

 

 

 

 

 

 

China has expressed interest in participating in Malaysia’s 330km-long Kuala Lumpur-Singa-pore high speed rail (HSR) link project.

 

China President Xi Jinping said the project, together with port development and other connectivity projects, were on top of their overseas investment ventures.

 

He said they were also ready to consider participating in the Nor-thern Economic Corridor development projects.

 

“The Chinese government will continue to encourage Chinese companies to participate in Malaysia’s railway, port and other connectivity projects.

 

“The Chinese government is ready to give positive consideration to participate in the Northern Corridor development projects in the appropriate ways,” he said yesterday at a joint press statement with Prime Minister Datuk Seri Najib Tun Razak after their bilateral meeting at the Perdana Putra Building here.

 

Earlier this year, Malaysia and Singapore announced plans for the rail link, which is expected to cut land travelling time between the two countries to just 90 minutes.

 

The project, targeted to be completed by 2020, is reported to cost about RM40bil. Several local and foreign firms have been reported to have started talks to form consortiums to bid for the project.

 

The firms are MMC Corp Bhd, which may team up with Gamuda Bhd and Chinese and European system integrators and YTL Corp Bhd with Spanish bullet train maker Talgo or CAF.

 

Other firms are UEM Group Bhd, which is working with Ara Group to form a consortium with European companies that may also include Talgo, while Global Rail is said to be talking to Canada’s Bombardier Inc and Chinese firm China Railway Group.

 

Xi said during the bilateral meeting that both governments agreed to maintain high-level contacts and this would help enhance coordination on major issues.

 

“There will be a closer cooperation in defence, law enforcement, security, naval and military exchange, combating terrorism and transnational crime. By doing so, we are going to create a sound environment for the growth and prosperity of both countries,” he added.

 

He said both countries had agreed to actively advance the construction of science lab and expand the training and exchanges among young scientists.

 

He added that both governments would also encourage competent and capable companies to take active part in the space and scientific entrepreneur cooperation.

 

Meanwhile, International Trade and Industry Minister Datuk Seri Mustapa Moha-med said Malaysia was eyeing 5% of China’s US$500bil (RM1.588tril) outbound investments over the next five years.

 

The country is also hoping to attract 5% of the 80 million outbound tourists from China searching for a suitable holiday destination.

 

“With its US$500bil set to flow into other countries, China will be an important investment source for us,” he said at a press conference after the Malaysia-China Economic Sum-mit at the Kuala Lumpur Convention Centre yesterday.

 

Mustapa said China’s huge potential was something that should be looked into by the ministry, Malay-sian Investment Development Authority and Malaysia External Trade Development Corporation.

 

He said China’s investment in Malaysia was less than the other way around.

 

“Currently, China’s investment in our country is only about 10% of the US$6.3bil (RM20.05bil) of what Malay-sia invested in China,” Mustapa said.

 

Asked the reasons for the imbalance, he cited the high speed of development experienced by China.

 

“There are a lot of opportunities for growth there,” he said, adding that Malaysian businessmen were knowledgeable and attuned to the Chinese market.

 

Mustapa said Malaysia hoped that China’s industry players would invest in the services and manufacturing sectors here. On the event, he said eight business projects worth RM9bil were signed with China.

 

 

 

 

 

THE governor of the Brazilian state of Ceará Mr Cid Gomes signed a Reais 2.26bn ($US 1.03bn) contract with a consortium of Centenco Engineering, Brazil, and Acciona Infrastructure, Spain, on October 11 for civil works on the 12.4km Fortaleza Metro East Line.

 

The line will run east from an interchange with the existing Metro South Line at Chico da Silva station in the city centre to Edson Queiroz with 12 stations, 11 of them underground, and is expected to carry around 400,000 passengers per day.

 

The total budget for the East Line, the largest public works project ever undertaken in Cear, is Reais 3.5bn, including a fleet of 20 trains.

 

The state government says a works order is due to be signed by the end of this month, which will allow construction to begin. Two 6.9m-diameter TBMs have already arrived in the city and are being tested, while two more machines are currently being assembled in China.

 

With a population of 3.6 million, Fortaleza is the fifth-largest city in Brazil.

 

 

 

 

 

 

 

 

THE economic pendulum of investment patterns appears to be swinging back in favour of developed countries. Among those voicing such opinions is Mr Shane Oliver, a Sydney-based head of investment strategy at AMP Capital Investors. "It's one of these things that happens once a decade or so when you see a turn in relative performance," says Oliver. "We have entered a tougher, more difficult period."

 

Africa, and many of the so-called emerging nations that are largely resource exporting countries, need to carefully review which mine, rail and port projects involving greenfield construction may lose out when times are tough.

 

Warning signs have been cropping up in the back pages of remote business news reports for about 12 months, yet grand plans for new mines and railways continue to be broadcast as if the old game rules still apply.

 

The eye of the now five-year-old economic storm may now be directly above emerging markets. During the last seven months, an estimated $US 156bn of investors' cash went into developed market equity exchange-traded products, says a Bloomberg report, while there was a net outflow of $US 7.6bn from new emerging nations' market funds. Compare this seven-month trend with the almost $US 4 trillion equivalent that flowed into emerging markets during the past four years.

 

Rio Tinto announced during the last week of August that it has delayed targeted production from the $US 20bn Simandou iron-ore project in Guinea by three years. The project includes a massive railway and port project as the supply chain to sell the ore to China and India.

 

The multiple investors in Simandou - Rio Tinto, China's Chalco and the World Bank - have just signed a draft agreement with the Guinea government that now says that the first export ore movements are not expected until the end of 2018, whereas the original target was 2015. The agreement signals the intent of the partners to work towards a binding agreement by the end of the year that will be focused on terms and conditions for funding the construction of the 650km railway through Guinea to a port south of the capital, Conakry.

 

Even with the delayed agreement, it is not yet clear whether this railway or a new line following a more direct route to the coast will be built. The mining companies would probably prefer a far less capital expensive route south to a Liberian port, whereas Guinea naturally prefers a Guinea port.

 

Rio has also spread its project risk by reducing its share in the Simandou project to 50% with a dilution to Chalco and other potential infrastructure builders. If and when it moves forward with construction, Simandou would be Africa's biggest mining project.

 

This is one example of African development plans hatched during the boom years of 2002 - 2008 which are now somewhat adrift. Simandou was one of three projects in emerging nations that Mr Tom Albanese the former chief executive of Rio Tinto invested in while following the projected China market expansion expectations prior to 2009. Albanese lost his job following a vote by the Rio Tinto board. The other two include the $US 6bn and climbing Oyu Tolgoi copper and gold mine in Mongolia and a $US 4bn acquisition of the Riverdale Mining coke coal project in Mozambique.

 

Expansion of the Mongolia project to a second stage has been reportedly mothballed because secured investment agreements with the Mongolian government have not yet been signed. The Mozambique assets were written down by $US 2.9bn earlier this year and the project delayed. Both the Mongolian and the Mozambique projects had expensive and now delayed rail construction requirements.

 

Other African rail projects that could be delayed because of the uncertainty of export ore and coal market demand from China or India include:

 

a project to modernise the Dakar to Bamako metre-gauge rail link at a cost of at least $US 700m or $US 1.6bn if it is converted to standard gauge a $US 1bn plus new line in Namibia a $US 250m rail project in the southern Democratic Republic of Congo to reach Angola, and a $US 3bn new standard-gauge line in northern Mozambique. In all, more than half of a projected $US 50bn investment in African rail projects could be in jeopardy. Yet others remain equally optimistic about the African rail market. One report suggests that the strongest annual growth rates in excess of 11% are expected in Sub-Saharan Africa, where several new routes and even networks are currently planned and will most probably be realised.

 

The counterintuitive evidence suggest that in the face of new market forecasts of a surplus of mine resource supply by some investment houses that have significantly downward revisions of demand forecasts, many rail projects will be delayed for quite a period. A Goldman Sachs report entitled Iron Ore Gluts Seen Through 2017 suggests that the ocean route iron-ore market is poised for at least four years of over-supply.

 

This multiple source back page reporting leaves open the question of which African rail projects will move forward first? Put bluntly, which schemes have the strongest business prospects?

 

 

 

The first subway running from Shanghai to Kunshan City, east China's Jiangsu province, started its trial operation Wednesday morning.

 

The subway is actually an extension stage of Shanghai Metro Line 11, which combined 3 subway stations in Kunshan to the original metro line.

 

After it begins operation, it will take about 70 minutes to travel from Huaqiao Station in Kunshan to Xujiahui Station in downtown Shanghai, which only costs 7 yuan.

 

The subway will make the journey between the cities easier for residents.

 

It is known that transit cards in Shanghai can be used in the 3 stations in Kunshan, while transit cards in Kunshan can be used on Shanghai subways.