Congestion pushes Chinese on to their bikes

April 19, 2013 5:14 am

Congestion pushes Chinese on to their bikes

By Patti Waldmeir in Hangzhou, China

For decades under communism, owning a private car was an impossible dream inChina. Now that the dream has come true for tens of millions of Chinese, they are waking up each day to a life of traffic jams and smog. Beijing’s air pollution has been so bad recently that it has captured headlines around the world – yet the capital has far from the dirtiest air in China. More and more mainland cities can boast world-class traffic congestion, parking shortages and commuting times, auto analysts say.

Under Chairman Mao Zedong, schoolchildren were taught that these were the ills associated with capitalism, but China’s urban planners were no match for half a century of pent-up demand from first-time car buyers. The country, whose showpiece industry event – the Shanghai Auto Show – starts this weekend, is now the world’s largest car market. And it is paying the price. With more than half of all Chinese living in cities, “smog and clog” are becoming big political issues. Even washing all those cars is exacerbating the country’swater shortage, according to a report last week from a Chinese NGO. The impact is so high that some cities are even thinking the unthinkable: sending China back to its roots as a nation of cyclists.“Ten years ago, everyone dreamt of owning a car. But after they realised that dream, they found it has caused a lot of problems,” says Dong Hongzhao of the Intelligent Traffic System programme at Zhejiang University of Technology. “Traffic congestion has harmed our health and caused a lot of inconvenience,” he adds, predicting that urbanites will soon be fed up enough to opt for public transport, or even bicycles.

Schemes by local authorities to encourage people to use bikes are popping up across the country.

Hangzhou, the city where Mr Dong lives and works, is one of China’s most famous tourist cities but is also a municipality of 11m people, bigger than Greater London. It is famous throughout China for its traffic jams – but also for having the world’s largest public bicycle rental scheme.

An hour after sunrise, the public bicycle stand on Kaixuan Road in Hangzhou starts to get busy. A mother loads her small son on to the bike’s child seat to deliver him to school. She swipes the public transport card that gives her an hour on the bike for free – the same rechargeable card she can later use for a ride on Hangzhou’s new subway line, a public bus or taxi.

Later, a middle school pupil wearing the red neckerchief of the Communist party’s Young Pioneers pulls out a bike, then an old man with a dog in the front basket, and finally 24-year-old white-collar worker Jin Qiyan takes the last cycle for his one-hour commute to work. Mr Jin owns a car, but says “it’s faster, more convenient and more environmentally friendly by bike”.

Traffic congestion has harmed our health and caused a lot of inconvenience

– Dong Hongzhao, Zhejiang University of Technology

With a rental stand every 300m in downtown areas, mobile apps that tell users where to find the closest available bicycle, and fees that rise from Rmb1 to Rmb3 an hour, the scheme is already very popular: as many as 400,000 people use it every day.

Hangzhou wants to encourage the city’s 1m car owners (a figure that has quintupled in the past decade) to stop “misusing” their vehicles for short trips that could be made by bike, says Luo Bin of the Hangzhou Municipal Comprehensive Traffic Research Centre, a quasi governmental organisation. The city government wants 50 to 60 per cent of people walking, riding electric bikes or push bikes.

Other cities such as Suzhou, Foshan, Shenzhen, Taiyuan, Changsha, Shanghai and Chengdu, to name just a few, are also pushing public bicycle rental.

But so far there are few signs that the Chinese are ready to trade in their BMWs and go back to bicycles: in the first quarter of this year, sales of SUVs rose 45 per cent year on year – hardly a sign of an environmental revolution among Chinese drivers.

Mr Luo acknowledges that a big part of the current problem is failure to enforce laws against traffic violations such as double parking and blocking intersections. “Fifty per cent of the congestion is made by people themselves,” says Klaus Paur, of Ipsos consultancy in Shanghai. Handing out a few traffic tickets may be easier than getting China’s car lovers to obey the decree: let them ride bikes.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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