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Sustainable Urban Transport Financing in China - Daniel Bongardt - GIZ China - Transforming Transportation 2013 - EMBARQ and The World Bank

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Sustainable Urban Transport Financing in China - Daniel Bongardt - GIZ China - Transforming Transportation 2013 - EMBARQ and The World Bank

  1. 1. Urban Transport Financing in China!!   Presented at Transforming Transportation 2013!!   Daniel Bongardt!!   Project Director!!   GIZ China!Transforming Transportation 2013!
  2. 2. Urban Transport Financing in China Transforming Transportation 2013, January 17th, Washington DC Daniel Bongardt, GIZ China2/4/13 Type presentation title here Page 2
  3. 3. The Trillion RMB Question How can urban transport funding in China become sustainable and trigger more green transport development?2/4/13 Page 3
  4. 4. Background: IncreasingCosts of Urban Rail•  29 subway projects in 22 cities approved•  ca. 1 trillion RMB total investment in 2012•  1 km subway costs about 0.7-1.0 billion RMB•  4 billion RMB of subsidies annually in BeijingSource: China Daily (January 10, 2013)2/4/13 Type presentation title here Page 4
  5. 5. Existing National Funding•  Transit fuel subsidy (50 billion RMB/year)•  Pilot Transit Metropolis Programme of MoT (still tbd. around 0.5 billion RMB/year)•  Low Carbon Urban Transport Pilot City Programme of MoT with 26 pilot cities (250 million RMB in 2011, 500 million RMB in 2012, over 700 million RMB in 2013)•  Comprehensive Passenger Transportation Hub Programme to connect different transport modes (100 Hubs planned during the 12th FYP, subsidy to each hub is 30-50 million RMB)•  200 logistic centres during the 12th FYP (30-50 Mio. RMB per centre)•  Low carbon city programme under NDRC (transport share unknown)2/4/13 Urban Transport Finance in China Page 5
  6. 6. Current Financing Issues in China•  Land concessions•  Debt accumulation in cities Investments•  No dedicated national fund•  Tax revenues for highways•  No land value capture Operation•  Fixed ticket fares•  High subsidies for operation2/4/13 Urban Transport Finance in China Page 6
  7. 7. Further challenges ... Institutional Planning Capacity at Issues framework local level •  Institutional •  Coordination •  Limited complexity between cities knowledge •  Lack of co- •  Link to urban •  Lack of overall ordination development manpower (horizontal) •  Focus on net- •  Assessment of •  Private sector works rather performance involvement than user and •  Data access and impact availability2/4/13 Type presentation title here Page 7
  8. 8. Urban Transport Finance Expert Workshop, November 1-3 2/4/13 Page 8
  9. 9. International ExperiencesFunding for regions or city-clusters Co-financing of projects A strong single authority for SUT Financial support for technical assistance Training Assessment bodies Support for studiesCoordination between cities Linking transport & urban planning Mandatory mobility plans that fulfil certain criteriaDefinition of criteria for funding Projects need to be part of master plans to be eligible Using local revenues Public-private partnerships 2/4/13 Page 9
  10. 10. Innovations for urban transport financeParticipants were working in4 breakout groups:1.  Local Empowerment Increasing options for local funding of sustainable urban transport2.  Mainstreamers Scale up innovative funding options for sustainable urban transport3.  New Transport Fund Using national funding to catalyze sustainable urban transport4.  Long March to Structural Reform 2/4/13 Type presentation title here Page 10
  11. 11. Building blocks ... ... of sustainable urban transport financing in China Further concentration of responsibilities Private Indp. mobility Performance sector observatories indicators Guidance Evaluate Comprehensive Performance for cities Mobility Plans City dept Grant s management National Urban Move away from land More funding concessions Transport Fund through TDM Fuel tax Parking, propertyrevenues tax, congestion National charging, etc. Local 2/4/13 Type presentation title here Page 11
  12. 12. Towards new urbantransport financing National fundingin China Compre- hensive Mobility Plans Integrated Sustainable Transport Policies Remove system (incl. TDM gen- erating revenues)relying on sales of land concessions 2/4/13 Page 12
  13. 13. Thank you! Page 13
  14. 14. Back-up Slides2/4/13 Urban Transport Finance in China Page 14
  15. 15. 0,43 Public transport financing in GermanyPublic Investment in Rail (in billion €, estimation for 2008)BSchwAG-Anteil SPNV,zusätzliche Haushaltsmittel Länder/ 2,78Kommunen, LuFV-Anteil SPNV Tax reductions for PT Querverbundsvorteil, keine 1,85 USt für Verkehrsverträge;Public Investment in Bus GVFG/ ermäßigter MwSt-SatzEntflechtungsgesetz, zusätzlicheHaushaltsmittel Länder/ 8,99Kommunen, Bundes-GVFG Revenues from operation Fahrgelderträge (ohne 5,34 Tarifersatzleistungen; Operation Rail SPNV: 3,14; ÖSPV: 5,55), Verkehrsverträge Werbung, Pacht (ohne Ausgleichszahlungen, inklusive Trassenpreise) 2,17 Subsidies for special 3,05 tickets (social groups) Operation Bus (Sozialtickets, SGB IX, Querverbund, Verkehrsverträge, Schülerbeförderung, Betrauungen, freigestellter Verbundtarif-Förderung) 24,61 Total public transport spendings Schülerverkehr 15,62 Share of public funding 2/4/13 Source: KCW, 2010 Page 15
  16. 16. Towards urban transportfinancing in China Expenditures National Urban •  Investment Transport Fund •  Operation Sale of Land Consessions •  Maintenance Creat new revenues on local level (TDM) 2/4/13 Page 16
  17. 17. Group 1 – Local EmpowermentIncreasing options for local funding of SUT1.  Private investments and efficient operation through private sector involvement2.  Analyse, shift, add, prioritize – focus on add on local level (e.g. parking fees, license plate auctioning, road charging, company tax to support public transport (see French example), land value capture, ticket faresNext steps: Analyse the current revenue status and develop futurerevenue options for pilot cities.2/4/13 Type presentation title here Page 17
  18. 18. Group 2 – MainstreamersScale up innovative funding options for SUTLocal Level National LevelInstitutional reform towards a single Allow local governments to create localauthority managing urban transport sources of revenueEstablishing an integrated transport Dedicate national sources of funding forfund out of different sources of funding sustainable urban transport (e.g.(national and local) increase fuel and or vehicle taxes)Funding priorities are integrated sust- Provide policy and capacity buildingainable transport projects, integrated in support.urban development master plans Coordinate guidance for sustainableDefining citywide objectives on key urban transport under a single nationalperformance indicators (e.g. mode authorityshare)Next steps: Institutional mapping and further studies to be built trust2/4/13 company presentation 2012 Page 18
  19. 19. Reform China Transport with New FundUsing national funding to catalyse urban transport•  Comprehensive Mobility Plans that meet National Planning Requirements•  Establishment Urban and Provincial Mobility Observatories for independent data collection and monitoring•  Competitive grants for investment in public transportation that meet CMPs•  The Fund could be funded by shifting a portion of the national fuel tax and vehicle tax revenuesNext steps: Informal discussions to prepare an in-depth proposal followedby establishing effective capacity building, administrative, and enforcementmechanisms2/4/13 Type presentation title here Page 19
  20. 20. Long March to Structural Reform•  Align administrative structures with the functional urban area so that there will be one agency, coordinating transport policy•  Cautious de-link urban revenue from land concessions and allocate more funding to SUT (including TDM, land value capture)•  Coordinated national urban transport program at national level as a framework for revenue mobilization•  Establish benchmarking and performance indicators.•  Develop a reporting mechanism (that takes developmental differences within China into account)•  Carefully allow cities to take on debtNext steps: Institutional pilot project for funding urban transport (e.g.bundling pilot programmes tied in with the development of a strategic planand experiment with local revenue generation such as property tax.2/4/13 Type presentation title here Page 20
  21. 21. Eight Recommendations1.  Unifying responsibilities (national and local)2.  Consistent policy guidance in a national urban transport policy (national)3.  Creating a Chinese National Urban Low Carbon Transport Fund (national)4.  Strengthen local debt management (local)5.  Develop new revenues for sustainable urban transport (national and local)6.  Develop urban comprehensive mobility plans (local)7.  Improve public-private partnerships (local)8.  Pilot programme to test new approaches to urban transport funding (national)2/4/13 Type presentation title here Page 21
  22. 22. Transforming Transportation 2013!!   Co-organized by EMBARQ and The World Bank!!   More information at:!!!!!!   Questions? Comments? Contact us at!!   Follow us on Twitter: @EMBARQnetwork!Transforming Transportation 2013!