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China OKs $292 billion railway investments

China OKs $292 billion railway investments

China's leaders have approved 2 trillion yuan ($292 billion) in spending on railways construction, stepping up planned investments to help fend off an economic slowdown, the official Xinhua News Agency said Monday.
The early approval last week by the State Council, or Cabinet, for the spending is meant to help support faltering economic growth, Xinhua cited a Railway Ministry official, Wang Yong, as saying.
The railways development plan calls for 2 trillion yuan in construction spending by 2020 but the ministry official said total spending is likely to exceed that amount.
China is in a railway-building boom, adding hundreds of miles a year in an expansion that rivals the construction of railroads in the 19th century American West.
It is hoping to ease congestion, promote economic growth in isolated areas and bind restive regions such as Tibet and the Muslim northwest more closely to the rest of China.
Plans call for the railway system to expand to 75,000 miles (120,000 kilometers) by 2020 from the current 48,750 miles (78,000 kilometers).
Ramping up construction can help create jobs at a time when the country's economic boom appears to be stalling, with growth in the third quarter reported to be the slowest in five years, although still a robust 9 percent.
Expanding the rail system would also help alleviate severe bottlenecks, especially for transport of the coal that is used to generate three-quarters of China's electricity supply.
The freight lines now are heavily overloaded, with volume expanding by nearly 9 percent a year, while freight transport capacity grows by only 3.4 percent a year, Xinhua said.