From Chinese Press

Lift road and bridge tolls

(China Daily)
Updated: 2011-05-17 07:57

It's well known that oil, real estate and finance companies make huge profits. But now the media report that companies engaged in building roads and bridges make even more profits. The huge profits they make increase logistics costs, which in turn raise prices of goods and materials - and are partly to blame for the recent hike in vegetable prices. Perhaps it's time to reform the road- and bridge-building sector, says an article in Guangzhou Daily. Excerpts:

Why are tolls so high? The reason is simple: Tolls are used to repay the cost of building roads and bridges.

To understand this, we have to travel back in time. In the 1980s, transport infrastructure, especially roads and bridges, was one of the biggest obstacles in the country's path of economic development. And that was a time when the government didn't have enough funds to finance the building of roads and bridges across the country.

Therefore, the government sought loans from private and other investors to build the much-needed transport infrastructure and then repay the money from the tolls collected from drivers using the roads and bridges.

This, no doubt, solved the problem of limited funds, helped develop the country's transportation system and stimulated its economic development.

But since times have changed, the government should do away with this mode of infrastructure development. The government today earns enough financial revenue, which was more than 1 trillion yuan a month in 2011, to build roads and bridges. So now, it should abolish tolls, because roads and bridges are public utilities.

Besides, high tolls are more of a hindrance to China's economic growth today, because the huge profits road- and bridge-building companies make ultimately come from ordinary people, who end up paying higher costs for almost everything they buy.

Worse, authorities in some provinces and cities use roads and bridges as a money-making machine, forgetting that they are first and foremost public utilities.

(China Daily 05/17/2011 page9)