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Key Projects |
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| Project Name: |
| No. 9 line subway Project |
| Project Owner: |
| Beijing Infrastructure Investment Limited Company |
Project brief
Beijing is an especially large city with a planning area of 1,041 square kilometers, and the resident population in Beijing have reached up to 14,230 thousand in 2002. However, the continuous, rapid increasing of city population and social economy certainly leads to the fast growth in requirements of traffic. In addition, the configuration of traffic system is still far from reasonable, for example, mass transit, particularly rail traffic, accounts for a little proportion in the total traffics, which induces that the above traffic requirements cannot be satisfied effectively. At present, the traffic pressure in Beijing city goes up increasingly. Thus, it is essential to enhance the development of mass transit, particularly rail traffic, to advance the development of Beijing city.
As the first city in China to have a subway, Beijing city has owned a total mileage of rail traffic of 113.23km so far. According to the city planning, many Projects, including the No.4 line, No. 5 line, No. 9 line, first-stage construction of No. 10 line (containing the Olympic branch line), airport line, Yizhuang line, and so on, will start up in 2003. The newly increased mileage of rail traffic in Beijing city till 2008 will reach up to 143km, and the total mileage will be 256km. In addition, three suburb railways leading to Changping, Liangxiang and Shunyi respectively will be built, which will make the total mileage of rail traffic in Beijing city exceed 300km. The planning network for rail traffic till 2008 is illustrated below.
Technical and economic parameters of the Project
1. Total mileage: 16.8km
2. Number of stops: 15
3. Total investment: 6.66 billion Yuan
4. Static investment: 6.26 billion Yuan
5. Construction period: from 2006 to 2010
Investment content
This investment Project will subdivide all the investments of No. 9 line into two parts: A and B.
Part A will include land-requisition and relocation of residents, civil work (including building of subway stop, holes, vehicle pieces and parking lots), railways, civil defense, and so on. In this part, the investment and construction will be in the charge of the government investment party. The investment of part A accounts for 70% of the total investment, approximately 4.66 billion Yuan.
Part B will include purchase and installation of electromechanical equipments, such as vehicles, auto ticket-booking and ticket-checking system, signal and communication, air-conditioners, water supply and drainage, fire controls, escalators and elevators, control equipments, power supply facilities. The investment of this part accounts for the rest 30% of total investment, about 2.0 billion Yuan.
This investment will seek social investors, who have experiences of investment, construction and management of rail traffics and have strong financial capacity, as the strategic cooperative partner of the government. The specific aspects for investment of social investors consist of investment and construction of part B, management, maintenance and renewal of all assets of No. 9 line during licensed period, and management of advertisement, communication and commercial services in the stops of No. 9 line.
Investment mode
1. The investment company designated by government will act as the government investment party and shall be in charge of investment and construction of part A in the investment Project, and have the ownership of assets in part A. Assets in part A will be supplied to and used by the following licensed companies in the form of concession as financial contribution and lease, in which the assets related to concession as financial contribution may be termed for short as A1, while the assets involved with lease may be termed as A2.
2. The government investment party and the social investor sign Cooperating Agreement and found together the cooperative licensed company (hereinafter as PPP company). The government investment party will provide funds by the concession of A1, while the social investor will provide funds by cash. The government investment party will control the company, but they don't have the right to make decision on the daily management of the company. In addition, the government investment party will not participate in sharing the incoming, nor be responsible for the deficit of management of the company, but they will have the decision-making authority on items such as important handling of assets and issues involving the operation security. The social investor has the right to make decisions on daily managements and earning of the company.
3. PPP Company is in charge of the investment and construction of assets in part B and the required funds will totally be on behalf of social investors. PPP Company needs to make Lease Agreement with the government investment party, gains the concession of A2 by means of lease, and pays rents to the government investment party. PPP company will take charge of the management of the above four lines, the maintenance and renewal of all assets, and obtain the incoming of tickets and other relevant incomings after foundation of all of the Projects. During the operation, the government investment party will share part of incomings through increment and reduction of rents and sharing part of passenger movement risk. At the end of licensed period, PPP Company shall transfer the overall facilities of the Projects free of expense to government investment party.
4. The related departments of city government shall make the License Agreement with PPP company to grant PPP company with franchise rights and clarify the rights and obligations of government and PPP company at the same time, which includes the construction standards, running standards and transfer standards of Projects when licensed period expires of the four lines, and involves creating conditions and setting up relevant supervision and excitation mechanisms to ensure normal construction and management of Projects by PPP company. Franchise rights shall not be transferred. If PPP Company disobeys relevant laws, regulations and License Agreement seriously, then authority departments of city government may take measures including withdrawal of franchise rights. The licensed period comprises construction period and running period, and is usually 30 years.
5. The No.9 line will carry out distance-dependant ticket price system. The related departments of city government shall define the initial ticket price and price-adjustment mechanism. However, if the actual price defined by government is lower than that defined above after the line starts to work, the city government will compensate PPP Company.
6. The social investor will be chosen to run the investment Project by means of tender. On the premise that the social investor is in accordance with the regulations in the tender documents on construction, experiences, achievements, and financial capacity, the bid will be the rent that PPP company should pay to the government investment party as promised by the social investor.
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