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DE RUEHGZ #0482/01 2190831
ZNR UUUUU ZZH
R 070831Z AUG 09
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 0836
INFO RUEHGZ/CHINA POSTS COLLECTIVE 0221
RUEHBJ/AMEMBASSY BEIJING 0648
RUEHGH/AMCONSUL SHANGHAI 0159
RUEHSH/AMCONSUL SHENYANG 0169
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RUEKJCS/DIA WASHDC 0208
RHHMUNA/HQ USPACOM HONOLULU HI

UNCLAS SECTION 01 OF 02 GUANGZHOU 000482 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/CM, INR/EAP, EEB/TRA 
 
E.O. 12958: N/A 
TAGS: ELTN SOCI ELAB ECON PGOV CH
SUBJECT: South China Rail Lines Expanding, But Not Due to Economic 
Stimulus 
 
Ref: A) GUANGZHOU 112; B) 2008 GUANGZHOU 48 
 
(U) This document is sensitive but unclassified.  Please protect 
accordingly. 
 
¶1. (SBU) Summary and comment:  South China rail lines will almost 
double to 9,400 km by 2020, but the expansion projects were included 
in central and provincial railway plans initiated in 2004, rather 
than as part of China's massive economic stimulus.  Expanded railway 
capacity will do little to alleviate pressure on migrant workers 
during peak periods, including the annual Chinese New Year holiday. 
The new Guangzhou-Wuhan Dedicated Passenger Line will open at the 
end of 2009 and reduce the ten hour trip to three hours, but tickets 
will be too expensive for most migrant workers to afford and may 
instead compete with domestic airlines as passengers choose high 
speed rail rather than 1-2 hour flights.  It remains to be seen 
whether demand from wealthy passengers targeted by the new lines 
will be strong enough to support development of so many new high 
speed lines in south China.  End summary and comment. 
 
Railways Expanding, But Not As Part of Economic Stimulus 
--------------------------------------------- - 
 
¶2. (SBU) Local implementation of a 2004 State Council plan to expand 
domestic rail networks will lead south China's operational railways 
to almost double from the current 4,900 km to 9,400 km by 2020, 
according to Guangzhou Railway Corporation Foreign Affairs Office 
(FAO) Director Ren Hong.  Guangzhou Railway Corporation is one of 
mainland China's 18 regional rail authorities and is charged with 
operating rail lines in Guangdong, Hunan and Hainan Provinces.  The 
state owned enterprise is currently working on 20 major construction 
projects, including new lines and the renovation of older 
infrastructure. 
 
¶3. (SBU) Guangzhou Railway's centerpiece project is the 
Guangzhou-Wuhan Dedicated Passenger Line, which will be completed by 
the end of this year and rank as China's longest high speed rail 
line.  Trains will travel the 965 km distance at speeds as high as 
350 km/hour, reducing the ten hour trip to three hours for as many 
as 80 million passengers per year, according to Engineering Section 
Chief Huang Ronghua.  This project and four other new high speed 
lines that will eventually connect Guangzhou to nearby provincial 
capitals and port cities were all initiated in conjunction with the 
2004 State Council and Provincial Government railway plans, not as 
part of China's recent economic stimulus package (ref A), Huang 
said. 
 
¶4. (SBU) New Guangzhou Station, located in the southern suburb of 
Panyu, will also open at the end of 2009 and will form the southern 
terminus for the new Guangzhou-Wuhan high speed line, according to 
FAO Director Ren.  The new station was included in the 2004 railway 
expansion plan and will eventually become a major transportation hub 
for south China.  Two subway lines were expanded to connect the new 
station with Guangzhou's existing transportation system, and new 
high speed passenger rail lines are currently under construction 
from Guangzhou to Zhuhai, Guangzhou-Guizhou, Guangzhou-Nanning, and 
Guangzhou-Shenzhen-Hong Kong.  Trains on the four new high speed 
lines will travel 200 km/hour, equal to the highly popular 
Guangzhou-Shenzhen high speed line. 
 
Expansion Focused on Profitable High Speed Lines 
--------------------------------------------- - 
 
¶5. (SBU) Engineering Section Chief Huang said the emphasis for 
Guangzhou Railway's expansion plans, and the company's construction 
resources, has largely focused on high speed passenger lines.  In 
addition to the high speed rail projects connecting to New Guangzhou 
Station, the Hainan East Rail Line is currently under construction, 
as well as the Xiamen-Shenzhen Line that will connect major cities 
throughout eastern Guangdong Province and southern Fujian Province. 
Five major new cargo lines are also under construction, largely 
focused on connecting second- and third-tier cities within Guangdong 
Province.  Huang said slower lines are less profitable than high 
speed passenger lines, and in many cases have lost money over time. 
 
 
Chinese New Year Migration -- Any Improvements? 
 
GUANGZHOU 00000482  002 OF 002 
 
 
-------------------------- ------------------- 
 
¶6. (SBU) Guangzhou Station, the busiest station in south China, 
serves 140,000 passengers on an average day, with surges as high as 
250,000 during peak travel times like Chinese New Year.  When 
compared with station operations during the February 2008 snow 
storms (ref B), a station tour revealed changes everywhere.  Station 
managers proudly pointed out new security procedures, larger and 
clearer information displays, expanded ticket windows and off-site 
ticket distribution centers.  FAO Director Ren, who previously 
served as Guangzhou Station Chief, said the improvements were based 
on lessons learned when 250,000 migrant workers remained stranded at 
Guangzhou Station for almost a week instead of returning home for 
their annual Chinese New Year celebrations in 2008. 
 
¶7. (SBU) Despite the capacity and other improvements, Ren said the 
80 million passengers that can be transported on the new 
Guangzhou-Wuhan high speed line will not relieve pressure on the 
traditional long distance passenger rail lines that connect 
Guangzhou to the rest of China.  Tickets on high speed lines will be 
too expensive for most migrant workers to purchase, meaning that 
expanded passenger capacity on that and other high speed lines in 
the Guangzhou Railway region will do more to attract new, 
higher-revenue passengers than to prevent future bottlenecks during 
peak travel periods for migrant workers, according to Ren.  Instead, 
domestic airlines are more likely to feel competition from high 
speed rail lines once travel times are reduced from ten hours to 
three hours between Guangzhou and Wuhan. 
 
GOLDBECK