Discussion on operational risk and financial sustainability of Beijing-Tianjin high speed railway

摘要

High Speed Railway (HSR) is an environmental friendly green industry. With implementation of Medium-and-long Term Railway Network Plan, investment scale of railway construction in China expanded continuously. Other conditions kept constant, transportation volume increasing rate of High Speed Railway is lower than that of investment within certain period, which inevitably leads to the problem of railway operation risk and financial sustainability. Beijing-Tianjin Intercity HSR is the first dedicated passenger line with operation speed over 350km/h, and will confront with demand risk, competition risk, financial risk, etc., of which, financial risk refers to the risk of capital chain break and long-drawn loss. Empirical study shows that capital flow will reach balance within year set of [2020, 2024], breakeven point in 2024. Sensitivity analysis manifests that income and cost changes have minor effects on financial risk while speed value and proportion of equity-debt have significant impact. Thus, the essence of financial risk faced by Beijing-Tianjin intercity HSR and Chinese railway system lays heavily on construction scale, standard and process.