Assessing Public-Sector Transportation Finance and Planning in Urban China

Abstract

This article explains the evolving urban transportation finance and planning institutions in China, aiming to help understand how the changing economic environment has brought challenges for public-sector transportation investment, and has stimulated the most recent reforms, and what impact these reforms could generate in the near future. In doing so, a systematic and spatial perspective is employed. The fiscal decentralization in the 1980s set the finance background for public-sector transportation investment by granting local governments greater flexibility in raising various transportation fees and constructing toll roads. The decentralized transportation finance, however, also reinforces the pre-existing mode-oriented transportation planning and management, and contributes to problems of system integration across multiple modes, across multiple cities and across city-rural boundaries. As the new economic and transportation environment pushes for a better integrated transportation system, two recent reforms, the national fuel tax and the consolidation of transportation management functionalities within the megacities, provide an opportunity to restructure the supply of urban and regional mobility in China.