Toll Road Development in China: Highlights in Practice Xiaoxia Yao September 11, 2012
Outline Evolution and Current Development Challenges and Issues Missions Ahead
Toll Road Network of National Arterial Highway Total length of toll roads in China is over 155,000 km.
Data Source: Transportation Statistics Intensive Construction Programs 2010 15.5 2007 20.4 2006 19.3 2005 18.3 2004 16.2 2003 15.5 2002 14.7 2001 11.6 2000 9.4 1998 7.5 1997 6.2 1995 1991 0.4 4.2 Unit: Ten thousand kilometers 1984 0.0 In the past 15 years, more than 1 kilometer toll road was constructed per hour, and 24 kilometers per day
Composition of Toll Road 0.6% By the end of 2010 34.9% 16.8% 47.7% Expressway Class Ⅰ Class Ⅱ Bridge and Tunnel Nearly 99% of the expressways, 41% of the firstclass highways, and 18% of the second-class highways are toll roads.
Toll Road Classification of Toll Road Loan Repayment Toll Road (LRTR), state-owned Commercially Operated Toll Road(COTR), PPP Tolling period for LRTR: maximum 15 years for COTR: maximum 25 years
Toll road Class Ⅱ Toll Road loan repayment toll road(lrtr ),state-owned commercially operated toll road(cotr),ppp LRTR charge deadline is maxium15 years, in West area the period can extent 5 years COTR is 25 years, in West area it can reach 30 years
Two Types Complementing Each Other LRTR COTR By the end of 2010 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Mileage Collector Revenue
Toll Rate Passenger car tolls average 7.1 cents on expressway, ranging from 4.7 to 9.5 cents (U.S. $) per kilometer Cents 7.8 7.7 7.6 7.4 7.2 7 6.8 6.6 7.1 6.6 East Middle West 6.4 6.2 6 Trucks are tolled according to load weight. The rates vary from 0.94 to 1.26 cents per ton-kilometer
Highway Financing Company Investment 7.8% Others 3.0% Government Budget 1.5% National Debt 0.3% Vehicle Purchase Fee 12.5% Local Funding 35.5% Domestic Bank Loan 39.4% 2010 Highway Construction Financing Structures
Debt of Toll Roads by the end of 2010 350.0 300.0 250.0 276.8 301.4 Unit: billion US$ Total debt of toll roads is 360 billion US$. 200.0 150.0 debt others total 100.0 50.0 0.0 24.6 26.0 30.0 15.5 20.0 6.9 8.5 4.0 4.6 1.5 expressway class Ⅰ class Ⅱ bridges and tunnels
Challenges and Issues (1) Tremendous Toll Road Development and Outdated Technology on Toll Collection Increased travel costs Traffic congestion Substantial traffic diversion to older free facilities High financing costs and risks Lack of Transparency and Public Involvement Lack of transparency in asset valuation and bidding process Toll revenue earmarking Intense criticism and negative attitudes towards tolling
Challenges and Issues (2) Lack of Mature Legal and Regulatory Framework Conflicting rules, not clearly defined responsibilities across functions Unclear government policies on public and private financing No professional toll collection auditing system Weak enforcement of toll road policies Fragmentation of ownership and excessive segmentation Sustainable Financing Schemes Needed Heavy debt for stated-owned toll facilities Unbalanced financial structures Inefficient road maintenance fee collection
Solutions---1 To improve legal systems and regulations Toll road policies: Objectives to be adjusted; More transparency and public involvement Regulations Concerning Toll Road Management: To be revised Rules to better allow concessionaire operation: Already under consideration
Solutions---2 Control of development scale : The central government plans to revoke class Ⅰ toll roads step by step in future Solutions---3 Integration of toll collection management Solutions---4 Promote ETC
Contributions and Lessons Remarkable accomplishment in toll road development, improved transportation mobility Innovative highway financing, foundation for future transportation infrastructure development Facilitated economic growth Development of private participation, complementary nature of state toll authorities and PPPs
To be rich, build road first. (farmers in China say) Toll Roads the Secret of Road Development Thanks! Xiaoxia Yao Transport Planning and Research Institute Ministry of Transport, China yaoxx@tpri.gov.cn