This Bystander suggested in January that China’s scandal-plagued railway ministry’s monopoly over the rail system might be due for a shake-up, highlighting a World Bank working paper as a trial balloon. So we note this sentence on the to-do list set out in the work report of China’s most powerful economic planning agency, the National Development and Reform Commission, to the recent National People’s Congress.
We will study and formulate a plan for reforming the railroad system in accordance with the principle of separating government functions from enterprise management and state asset management.
As the Bank’s paper pointed out, China’s is the only significant rail network in the world where the railways ministry makes policy, builds and owns the infrastructure, operates the services and regulates the system. Beyond the obvious conflicts of interests, which have shown themselves most prominently in the problem-beset build-out of the high-speed rail network, China’s rail system is now just so massive it is beyond the management of a single entity. The Bank’s paper, however, argued for rail to be put under a new transport ministry with multi-modal responsibilities for coordinating transport. If China is to make the most of all the transport infrastructure it has built over the past two decades, and that to come, it needs to integrate its road, rail and internal air and shipping with the sort of national transport strategy that is common in other countries.
That would be a mighty big to-do for the current leadership to leave to their successors. They would, no doubt, be happy to duck the bureaucratic civil war that carrying it out would involve. “Study and formulate a plan” is usually a euphemism for kicking hard decisions down the tracks, but they are none the less necessary for that. Breaking up the behemoth that is the railways ministry would be a good start.