“Institutionalized Corruption”: China’s Rail Projects Halted
Massive railway and road constructions in China
are facing a shortage of funds.
Over 10,000 km of railway under construction has been
halted or trapped in the slow progress, due to no financing.
Meanwhile, the debts grow as a large number of payments
are still owed to cement and steel suppliers.
There are six million migrant workers on railway
constructions, and many haven’t been paid for months.
China Daily reported that currently the lack of funding
for rail projects has caused a nationwide shutdown.
The suspended work on construction is over 10,000 km,
including 5,400 km of tunnel constructions.
Wang Mengshu, Deputy Chief Engineer of China Railway
Tunnel Group, said that after the Wenzhou Train Crash,
all sectors of society have largely increased their questions
on China’s technology of high-speed rails.
Financing has become more difficult.
About six million railway construction workers haven’t
been paid for the past half-year.
What’s more, railway construction companies have owed
a large number of payments to cement and steel suppliers.
Hong Kong’s Ming Pao reported, due to financial difficulties,
railways under construction are to be shut or slowed down.
Only 10% of such projects in China proceed as normal.
The opening of many railways have been postponed.
Payments to the railway construction workers
and suppliers have also been affected.
A survey on Chinarailway.com shows that over half
of the railway construction workers have been owed wages.
Contract workers for the construction of the Guanjiao tunnel
of Qinghai-Tibet railway haven’t been paid for seven months.
The total amount owed to suppliers
has reached RMB 350 million.
Since this July, there have been over 2,000 petitions
about owed wages with China Railway Group.
Wang Mengshu believed that railway projects across China
are estimated to employ about six million migrant workers.
If the problems cannot be reasonably resolved right away,
social instability might be triggered.
Mr. Feng, a Beijing-based economist, thinks only if there are
mass incidents would authorities pay migrant workers.
He said this is common in China, not only with the Railways,
but in other areas too, as the problem is now a vicious circle.
Mr. Feng: “Migrant workers have the right to ask authorities
for their wages, which needs the Labor Departments’ support.
Bankruptcy is the only instance in which related departments
cannot and aren’t able to afford to pay debts.
But now it comes amid a period of changing terms of office,
so everything will be postponed by the authorities.”
On October 19, China Daily reported that the shortage
of funds began to affect the construction of new roads.
It quoted Ministry of Transport’s report that this year 20%
of scheduled railway projects will not be completed on time.
Funds’ shortage is further expected in this fourth quarter.
In some provinces, for the past two or three months,
no payment has been made to construction companies.
Individual projects have been totally or partially terminated.
Beijing economist: “Ministry of Railways is very corrupt.
Its Minister has been arrested.
The loans involved were RMB 2 trillion. Now, the Ministry
still demands new loans and is going to issue debentures.
This is an administrative monopoly, a monopoly sector,
with lack of audit and monitoring by the Audit Department.
So all operations are like a black box.
This is institutionalized corruption.”
A netizen commented on a microblog, “A group of corrupt
officials try every approach to make money.
High-speed rail breaking down, moving trains derailed…
Train fares have gone up but getting a ticket is still so hard.
The speed is still so slow, yet the safety factor is also low.
It serves them right to go bankrupt.
We workers and taxpayers are still leading poor lives. It is
detestable how authorities squander randomly our purse.”
NTD reporters Li Yun, Chen Han and Wang Mingyu