China to build more railways to nowhere

Tuesday, 8 January 2019

Via the AFR:

A flurry of construction may be about to take off in China, and investors have pinned their hopes on it. Stocks of Japanese machinery makers Komatsu and Hitachi Construction Machinery perked up on Monday. Over the past week, Chinese engineering and construction companies’ shares have surfaced from multi-month lows.

…The optimism stems from the latest and greatest version of fiscal stimulus: more than $US120 billion ($168 billion) of rail projects across the country have been announced over the past month, which would add 6800 kilometres of track in 2019.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.