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On the Road at Last
Fritz Hoffmann/Network Photographers for TIME.
China hopes an ambitious plan to build a vast, nationwide highway system will link its remote western provinces to the global economic mainstream
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The toll collector is asleep in his booth on the border of rural Zhongxian county, 180 km and several decades of development away from the industrial city of Chongqing. At the toot of a horn, he puts out his hand to collect the four renminbi (50) the county charges motorists to share a narrow, potholed strip of pavement—more akin to an obstacle course than a toll road—with the ducks, water buffalo and yoke-bearing peasants who really rule the local roads. This day the ragtag traffic wends its way to the town of Shuanggui, where a morning market blocks the only through street, and locals go about buying and selling poultry and hot Sichuan peppers without so much as a nod to the snarl of vehicles. After all, the market has been a major destination on this road for centuries, and speed of passage has never been a priority.
Until now. With the recent opening, not far away, of a key leg of the high-speed expressway that will eventually link the Tibetan capital of Lhasa with the port of Shanghai, Zhongxian's parody of a toll road has suddenly become a conduit to the real thing: a $150 billion, 30,000-km national highway network. Drivers who can afford the $5 toll to enter the four-lane expressway near Shuanggui get their money's worth, making the trip to Chongqing in three hours, instead of the usual eight. As roadbuilders tunnel their way east through the high mountains, the words of ancient poet Li Bai—that "getting out of Sichuan is more difficult than getting into heaven"—are finally obsolete.
Following in the tire tracks of the U.S. Interstate system and the German Autobahn, China's Gaosu Gonglu, or expressway, is designed to connect the landlocked interior with the dynamic coastal provinces. When completed in 2020, the network will be second only to that of the U.S. in size. The super-highway grid currently boasts some distinctly Chinese characteristics—from chronically empty fast lanes and the heavy security needed to keep cyclists and pedestrians out, to the collapse of a bond scheme designed to help finance the network. But planners expect that eventually the road system will bring the whole country, including backwaters like Zhongxian, into the global economic mainstream. "Even in the age of the new economy, development means roads," says Hong Kong construction magnate Vincent Lo, head of a consortium promoting investment in China's central and western provinces.
For a country that boasts the world's seventh-largest economy, China is staggeringly underdeveloped in its transportation infrastructure. Before the National Trunk Highway System was launched in 1992, there were only 866 km of road (mostly unpaved) for every million Chinese, compared to 24,312 km of paved road per million Americans. Despite progress, the situation in China's vast west remains far worse than in the rest of the country. More than 5,000 of the small villages in Chongqing municipality have no roads at all. Developing the west is critical to the central government's strategy for stimulating economic growth, and roads are the key to opening up the region. "Liberating the west will release huge productivity, because that's where the cheap labor is," says Fan Jiang, a bond expert at Goldman Sachs in Hong Kong. "But that will not happen unless you lay down power lines and roads."
Beijing has come to that conclusion relatively recently. Two decades ago, the launch of Deng Xiaoping's economic reforms sparked a bitter debate between the powerful railroad lobby and proponents of highways. "Railroads were the dominant mode of transport during the era of the planned economy, when goods were allocated and delivery schedules were not paramount," explains Richard Scurfield, a World Bank transport expert in Beijing. "But in a market economy, goods must get to the market in a short time, and that means highways."
-Fritz Hoffmann/Network Photographers for TIME.
It wasn't until 1987 that a Princeton-educated Hong Kong capitalist named Gordon Wu finally gained approval for his plan to build China's first long-distance toll road, between Hong Kong and the boomtown of Guangzhou. It took Wu another year to persuade his joint-venture partner, the Guangdong provincial government, to build the highway with six lanes instead of four. "They accused me of being extravagant, insisting China would never have that many cars," says Wu. Early on it looked as if his critics might be right: revenues did not cover the interest Wu owed on the bonds sold to finance construction. He was saved from default by $67 million in government back-up loans. Those tided him over until 1997, when the toll road finally began to pay for itself. By then Wu's highway was making converts of those who had condemned it as a high-speed safety hazard, or derided it as an "Autostrada del Solo" for its lack of cars.
"Suddenly everybody was building highways," says Goldman Sachs' Jiang, "especially when the government ruled they could charge tolls to pay for them." To skirt regulations requiring central government approval for projects costing more than $30 million, eager developers chopped their road projects into less costly segments and got permission to float bonds overseas with the backing of local officials, who provided illegal financial incentives. The borrowing spree climaxed during the Asian financial crisis, when Premier Zhu Rongji took steps to rein in free-spending provincial and local governments. His refusal to recognize guarantees on cash flow shortfall payments on bonds not officially authorized by Beijing led to the collapse of several toll road companies, which defaulted on interest payments and stuck foreign investors with estimated losses of $460 million. Beijing, however, did not let the pace of roadbuilding slacken. Instead, the government said it would pour another $1 trillion into infrastructure projects.
Though the core of the grid is not slated for completion until 2010, the impact of each new link is already dramatic. "People's concepts of distance has been completely changed," says Zhang Jianfei, a senior engineer in the Ministry of Communications. "A decade ago 100 km meant a day's travel to most Chinese. Now it means one or two hours." Zhang, who studied in the U.S., recalls how intrigued he was to discover that the same produce was sold coast-to-coast for about the same price, regardless of season. Increasingly, that is the case in China, too. "Twenty years ago cabbage was the only vegetable available in north China, and it was stacked along the streets in winter," says Zhang. Now that improved roads allow transport of produce from the south, those piles are gone.
Not all of China's 800 million peasants have been won over, however. Their opposition to tolls slapped on local roads prompted Zhu to explore other means of financing road construction. But his preferred alternative—a national gasoline tax—is now being stalled by farmers demanding exemptions. "I call the phenomenon pwa—peasants with attitude," says Jeff Muir, Hong Kong-based managing director of Chongqing Seagram Co. Muir travels regularly by road from Chongqing to Zhongxian, where Seagram is developing Florida-quality oranges in China's traditional citrus-growing region. "The road is a metaphor for the tensions between the traditional rural way of life and the agents of change." He points to the way defiant peasants take over the shoulders of newly paved local toll roads to dry corn and rice, or roll rocks onto the road to obstruct truckers, whom they blame for endangering livestock and luring women to work in roadside brothels.
Only when peasants benefit from sharing the roads they once monopolized do they begin to feel responsibility for maintaining them. Like millions of other poor farmers in China's "wild west," Lei Xinyu migrated east in search of wages in 1994. He returned to Zhongxian last year when he heard that Seagram was offering $2 a day for help in transforming rice terraces into orange groves. When he saw that the road between Shuanggui and his home village had been paved during his absence, he saved his wages to buy a motorcycle and now makes up to $5 a day taxiing his neighbors to the market. "Now that the roads are better, people like to go to other towns to buy what they need," says Lei.
History shows that building roads is the easy part of a vicious cycle. Dealing with the ensuing traffic and pollution will be harder, as the U.S. experience with smog and creeping suburbia has proven. Chinese transport experts argue that with only 14 million vehicles—compared to 200 million in the U.S.—China has a long way to go before its auto emissions equal those of the industrialized world. In the meantime, China's toll collectors will have plenty of time to sleep.
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