Luoding Railway To Be Auctioned

Source: Guangzhou Daily

China plans to auction a railway company in the country's first public sale of rail assets. The money will be part of the 2 trillion Yuan (US$250 billion) needed for expansion and upgrades by 2020.

The government plans to sell 100 percent of Luoding Railway Co, an unprofitable coal carrier in southern Guangdong province. The company lost 135 million Yuan last year and is 794 million Yuan in debt.

The auction of a state-owned railway company is unprecedented, as reported by a government official. To sell 100% of Luoding rail assets means its new owner is given the rights of operation and management. Therefore, it is possible that the railway will become the first private railway in China's history. Since the purpose of this auction is to collect money for a new rail line, any successful tender will also invest in the 33 km rail line construction of Luo-Shen railway within Luoding.

(Translated by Ken Zhao, www.lifeofguangzhou.com)

Editor: Helena Zhang