China Expands its Public Transportation Network

More than 30 Chinese cities are considering proposals for construction of underground trains or are already in the construction process of underground means of public transportation, in one of the most ambitious investment programs of the Chinese government which will include a fully integrated railroad and air network, according to an article of Reuters. If the management of the project is done efficiently, the burst of construction activity in public infrastructure will create conditions for sustainable development in China in the coming decades.

When faced with the crisis, Beijing decided to act vigorously, launching a series of public works, including 35 airports, 5,557 km of railways, 98,000 express ways and major construction and expansion of its metro. According to Michael Petit of Carnegie Endowment, China is already on top of infrastructure based on the level of development. The bad news is that the huge public investment is working against the private investment which is needed to boost the local economy. The growth in consumption in China will necessarily be limited due to moderate growth in household income, as households are forced to pay for public infrastructure which can not be justified in economic terms, said Mr. Petit.