South China Morning Post 4 December, a story about how high speed rail networks in China are driving inland economies.
A couple of stats: China has 7,000 km of high speed rail and plans 16,000 by 2020, double the rest of the world combined. The strategic plan is to have all cities of over 500,000 connected by HSR, by 2020. What a vision!
China's expenditure of two trillion yuan should be added to the amount the world spends on CO2 abatement, if anyone's keeping count: that is, the 2% of global GDP that Stern reckons will have to be spent to hit the target of maximum 2 deg global warming and 550ppm of CO2 by 2050. For surely electric rail travel is better than air or bus, especially when the electricity is generated by China's increasing renewables.
And, btw, that amount ought by rights to be increased by about 25%, the amount by which the world reckons the RMB Yuan is undervalued. So that would come to about $US 450 billion in the next ten years The US has no such long term commitment.
This year alone, the US committed China's $US 90 billion to hi-sped rail vs $US 8 billion for the US.
The impact on the incomes and development of China's inland provinces will be profound and mostly positive. At least for China, higher incomes will mean better lives, better health and welfare, more prosperous and knowledgeable societies.
But not necessarily for those doing business with it. Some of our mates here in Hong Kong are suffering at the hands of this transformation. We have three friends in the clothing and textiles that are being squeezed by wages that have more than doubled in the last two years, and raw material costs, such as for cotton, that have risen sharply due to supply constraints. Their suppliers are saying "this is the price, take it or leave it", as they have domestic buyers if our mates don't want the product - another result of the increasing wealth of China's consumer.
