“Another bubble bursts”: Chinese subways face staggering deficits
Although only 28 of the 54 Chinese cities with subway or tram lines have released their operating results for 2024, Chinese media outlets are shocked by the colossal losses. Some estimate the cumulative debt at the equivalent of €500 billion.
"The end of the Chinese subway legend," laments Zhigu Qushi, a WeChat blog of a new financial media outlet bearing the same name , denouncing: "Another bubble bursts."
According to official data published on the operating results for 2024 of the subways of 28 Chinese cities, 26 are in deficit after deducting government subsidies. “The Shenzhen metro, the busiest in the country, is the most disastrous” in terms of its economic health. The financial report cited by the blog shows that the deficit, before deducting subsidies, reached 33.5 billion yuan (4 billion euros), which translates to “100 million [12 million euros] in losses every day.”
The article points to the "exorbitant cost" of building a subway, ranging from 500 to 600 million yuan per kilometer (72 million euros) to more than 1 billion yuan (121 million euros), six to seven times that of building a high-speed rail line. For a new 40-kilometer line, a minimum cost of 30 billion yuan (3.6 billion euros) is required, the article states.
In addition to these considerable investments, we must obviously add the daily operating costs.
Courrier International
