Price reform is a breakthrough point to comprehensively deepen China’s current reform, and also a precondition or key point to boost reforms in major fields. Industrial insiders always believe that price reform is difficult to be carried out in transportation service industry, which is an important field related to people’s livelihood. The progress of price reform in transportation area attracts much attention.
The State Council on Oct. 15 released Certain Opinions on Boosting Price Reform. It proposes that prices in competitive fields and segments will be basically open by 2017, and governmental pricing scope will mainly cover significant public utilities, public welfare services and network-based segments with natural monopoly. Meanwhile, it also proposes a sound price mechanism for transportation.
The data shows that, up to now, National Development and Reform Commission (NDRC) has reviewed and approved fixed assets investment projects of over 2 trillion yuan within this year; transportation projects account for over a half of the total investment, making it a real “leader” in the investment field. Li Guoyong, inspector from basic industries department of NDRC, indicated that China’s transportation industry fulfilled the investment expectation during the period of “twelfth five-year plan”, recording 13 trillion yuan, which is 1.6 times of that during the period of “eleventh five-year plan”.
Analysts pointed out investment for China’s transportation industry is expected to reach at least 20 trillion yuan during the period of “thirteenth five-year plan”; along with increasingly-reinforced investment, this industry will enter a new development stage.
Cai Jianming, a researcher of transportation industry in CIConsulting, pointed out in a press interview of Securities Daily that price reform of China’s transportation industry aims to realize marketization. Boosting price reform in this field is beneficial to improve modern transportation service system, and ease urban traffic jam; meanwhile, it is also fundamental to enhance marketization and competitions, improve market rules, and build up an open and transparent environment for the industry.
The Opinions also proposes to gradually decontrol the price in competitive field of railway transportation, and expand independent pricing scope for the operators. To this respect, Yang Weixiao, senior macroscopic analyst of Founder Securities Co., Ltd. (601901.SH), told the journalist that price reform in this industry will bring important favors to enterprises, such as railway, airlines, taxi and etc. On one side, price returning to market level is likely to increase the prices in this industry; on the other side, due to tight transport capacities in railway and aviation, the slightly-rose prices will not have much impact on demands.
Cai also pointed out that “in terms of transportation industry, difficulties in the reform mainly depend on whether the reform can be successfully implemented and conquer the mechanism. SOEs reform must speed up to deepen the price reform.”
Translated by Jelly Yi
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