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UPDATED: July 18, 2008 NO. 29 JUL. 17, 2008
Roaring Ahead
The Beijing-Tianjin Intercity Railway provides a rapid connection between the two economic hubs
By HU YUE
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"Going home via the expressway has become a headache for me," Zhang Liang, a Beijing resident who works in Tianjin, told Economic Information Daily. "The travel usually takes me three or four hours because of traffic jams or road repairs. My record was an astonishing seven hours."

The new rail line will have advantages for industries in Beijing and Tianjin as well. The logistics industry in the greater rail area will take off, according to a report in Logistics magazine.

Tianjin has long felt the pinch of its transport handicaps as it has battled to establish itself as an international logistics center. With the new line exclusively for passenger transport, trucking and freight companies now will have more space on other rail lines and expressways, said the Ministry of Railways.

According to the ministry, the rail line also would help promote logistics efficiency and safety. It could precipitate a shift in Beijing's trans-national logistics to Tianjin's port, because moving freight by sea is much more economical than by other means.

Real estate boom

The railway also is expected to breathe new life into Tianjin's commercial and residential real estate market, said Liu Yulu, an economist at Nankai University, in an interview with Tianjin Daily. The city's comparatively lower property prices will add to its competitive edge.

Beijing's existing residential homes inside the Fifth Ring Road, for instance, sold for an average of about 12,000 yuan ($1,714) per square meter in 2007, according to local housing and land administration authorities. But residential homes in downtown Tianjin sold for only 6,500 yuan ($929) per square meter that year.

Analysts say Tianjin's property market, buoyed by the new railway, may see prices climb to new highs, especially in Wuqing and Yongle.

Since construction started on the railway, property prices in Wuqing District have risen at an annual rate of around 20 percent. While the price of new homes in the district averaged 1,950 yuan ($279) per square meter in 2004, it soared to 3,000 yuan ($429) per square meter in the third quarter of 2007, according to an article in Real Estate magazine that cited data from Tianjin Centaline Property Agency Ltd.

Gao Fei, a manager at the real estate agency told Real Estate magazine that he expected to see a spike in Tianjin's commercial property market, because a large number of companies and institutions would relocate there from Beijing to take advantage of lower-cost office space.

Full circle

The new railway could compel more highly skilled professionals and advanced technology firms to move to the Binhai New Area. This state-level development zone in eastern Tianjin that runs 153 km along the coastline in the central part of the Bohai Rim area has drawn a cluster of multinationals.

Since it was approved as a state-level development zone in 2005, it has become a prime force in shoring up Tianjin's development. An additional influx of workers and companies in the Binhai New Area could help create an economic boom in the Bohai Rim Economic Zone, said Zhao of the Beijing Academy of Social Sciences.

The new rail line also is expected to boost Tianjin's regional and economic integration with Beijing in forming a greater Bohai Rim Economic Zone.

The zone is a semicircular region with the Bohai Sea at its center and is surrounded by the Liaodong Peninsula, Shandong Peninsula, Beijing, Tianjin and Hebei Province. It is deemed to be one of China's new economical engines along with the Yangtze River Delta and Pearl River Delta.

The railway, together with expressways and airports, would further integrate these areas and form a bridge to the outside world, said Zhao. As the number of residents and industries in the sprawling economic circle grows, they could become more centralized, because of the easier traffic flow provided by the new rail line. This could revitalize markets in the circle as well as increase employment opportunities there, he added.

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