By Wu Wenhua, Master of Economics, Associate Professor of ICT of SDPC

l. Current Situation and Major Existing Issues of Inter-City Transportation in China

1.1 Definition of Inter-City transportation Inter-city transportation bears both narrow and broad meanings. The narrow meaning of inter-city transportation refers to inter-district transportation among urbanized city proper, namely, the transportation and spatial networks of the 668 certified cities countrywide with transportation origins and destinations within their city proper. The broad meaning of inter-city transportation refers to passenger and cargo transportation links other than transportation within urbanized areas, namely, all passenger and cargo transportation demands outside the urban areas generated by urban and township social and economic activities belong to the scope of inter-city transportation, of Which, the scope of city covers state certified cities, urban counties, townships and ports Where large population and goods concentrate. Apart from inner-city transportation, the only transportation that does not constitute a part of inter-city transportation concept is inter-countryside transportation. However, as the volume of sheer inter-countryside transportation is comparatively small and is ranged under the definition of agricultural transportation, the commonly understood volume of transportation through railroads, highways, civil aviation, pipelines and waterways, therefore, basically reflects the volume of the broad inter-city transportation. For example, according to statistics of l997, total volume of passenger and cargo transportation of the 668 certified cities in China took up 76% and 78% respectively of that of the Whole country of Which, the volumes of passenger and cargo transportation to-and-from the 668 cities took up 100% of civil air transportation, 93% of railway passenger transportation and 97% of railway cargo transportation, 74% of road passenger transportation and 74.4% of road cargo transportation. If taking into account of the volume of transportation to-and-from the large number of medium- and small-sized townships, then the statistics of the total volume of transportation through railway, road and civil air in the whole country basically reflects the broad concept of inter-city transportation. Therefore this report takes the broad concept of inter-city transportation as its research target, using data relevant to broad transportation and transportation efficiency in the quantitative analysis for inter-city transportation efficiency, while emphasizing on factual analysis to reflect transportation efficiency among large- and medium-sized cities in the qualitative analysis.

1.2 Characteristics of China's Int6r-City Transportation Network The basic characteristic of transportation network is the material base that determines if the inter-city transportation system can play its role to the maximum. Through more than 50 years' of construction, China''s inter-city transportation network has acquired the following basic characteristics: A. A. The network of all routes is being gradually completed, and the inter-city transportation conditions are improving The inter-city network constructed by fixed facilities of railway lines and roads has developed rapidly, and its technical grades rose very fast, changing the conditions linking cities. Among all cities in China, over 90% have major trunk roads, some 70% of them are connected by railway lines, and l/5 of them have civil air ports. Meanwhile, over 30 cities have 4 railway exits, and abort l00 cities have 4 major road exits. The above transportation network have laid the basis for the development and rational management of inter-city transportation. To date, China has had already a length of l6,000kms of express highway connecting major cities. B. Development of institutional network Iack8 behind development of facility network In the l990s, China''s transportation infrastructure network developed rapidly. Express highways, railway lines and airports all experienced tremendous growth, registering rapid increase in overall mileage. In the coastal areas, high grade and high quality infrastructure networks have taken its form, providing good development environment for urban and regional economic development. On the other W, however, the transportation institutional network remains quite backward. The transportation network covering multiple cities with multiple modes suitable for the development of the market economy remains far from being optimized. This is caused by both system problem and management deficiencies. In particular the organization of highway network happens to be quite messy, and the efficient transportation network still remains to be established. C. Irrational distribution of inter-city network among urban areas (spatial transportation network) and irrational location and distribution of stations within cities Currently, most of the cities in China have established inter-city passenger and cargo transfer stations, which have greatly accelerated relay speed within cities or among them. However, the distribution of the stations that serve inter-city transportation in developed urban areas, especially within big cities, are not located for the convenience of communication, but for the convenience of management instead. The long-distance bus stations of inter-city transpiration are located at the edge of the cities inconvenient to reach, and thus restricted the inter-city passenger transport.

At present, most of the inter-city transportation facilities in China are not networked for easy and quick connection. Most of the means of transportation are in a disconnected status in the process of relay The worst connection is inter- city passenger transportation by roads, Which is basically transportation between two cities. Transfer network connecting multiple cities has not taken form. neither has there been much study on the subject. There is still a long Way to go for the transfer network connecting different transportation modes. In general, however, civil aviation and railway transportation network is comparably more complete.

1.3 Contradictions in the Development of lnt6r-City transportation in China

1.3.1 Contradiction between the rapid development of the inter-city transportation market and the backward tran8portation management system Since the reform and opening-up, the market oriented reform in China's inter- city transportation speeded up and a series of experiments have been underdone in various transportation modes and sectors to meet the needs of the development of the transportation market, and a lot of work has been done. However, as to the depth and ultimate results of the reform actions taken in the past, the management system of the present inter-city transportation is sti1l unable to satisfy the needs of the development of the transportation market. In particular in the area of road transportation, inter-city road transportation involves various urban management departments, such as traffic control, public security ,urban construction, tourism and economic and trade. It has resulted in a myriad of conflicting policies from various departments. Meanwhile, the small scale and dispersed management of inter-city transportation can hardly build up a scientific and effective transportation network system, but lead to weak sectional management, excessive local protectionism of road transportation, messy transportation market, and unfair competition environment. As to railway transportation, China's railway sector has so far maintained its characteristics of mixing up government functions with enterprise management, mixing up the objectives of social entity with that of the enterprise''s, mixing up the nature of public institution with that of enterprise''s, and remains a monopolistic sector that suffers from redundant labor. It is both an administrative management organ of the State as wel1 as a gigantic enterprise, with its monopolistic status yet to be dismantled. In the civil aviation sector, its government functions have not been separated from its enterprise management. Once under control, it becomes lifeless, but once the control is lifted, it becomes chaotic. Most of China''s civil aviation enterprises have been operating with debts for a long time, some of them suffer from serious losses, and the business efficiency and competitiveness of the enterprises are low The inter-city through-transport for passenger and cargoes is the inevitable development trend of modem inter-city transportation. However, from top to bottom or vice versa, the management mechanism of China''s present inter-city transportation is departmentalized. Consequently it is unable to meet the needs of the information system development, the high efficiency and the door-to-door service of modem cargo transportation, While the preparation for through- transportation incorporating different modes is not ready in both hardware and software aspects. The overall inter-city transportation system in China stil1 has a long Way to go before setting up a complete, consistent, and systematic inter-city transportation network system.

1.3.2 Contradiction between the structure of inter-city transportation Infrastructure supply and the changing pattern of transportation demands Since the reform and opening-up, the State has accelerated the construction of inter-city transportation infrastructure, but the inter-city transportation infrastructure remains insufficient owing to low level of technology poor transportation capacity and absence of fundamental change. China is a vast country with a large population and a great number of cities. As the volume of inter-city passenger and cargo circulation grows fast, the present inter-city infrastructure is obviously incapable to meet the needs of inter-city passenger and cargo circulation among major cities in China, resulting in particular problems as follows: (1) Insufficient supply capability of the railway transportation network and inadequate existing capacity of transportation Since the establishment of the New China, China's major inter-city railway line construction has never stopped, the preliminary framework of railway network all over the country has been set up, and the total volume of passenger and cargo transportation has been growing rapidly However, the transportation role of railway sector has diminished continuously. At present, the ratio of double-track lines and the traffic frequency are still quite low the rail trunk lines are running beyond capacity, and the regional difference of the network is obvious. In particular there is low density of rail trunk lines in the western regions where transportation pressure is greater, and the inadequate transportation capacity demonstrate itself most evidently during the holiday periods. (2) Existing highways arc generally of low quality and grades Although highway transportation has become the dominant mode of inter-city transportation in China, yet the existing highways apparently have problems of poor quality and low grades. In the present grading structure of China''s highway network, most of the highways (3/4 of the total) are either fourth-grade or off grade. There are growths in express highways and first and second-grade roads in recent years, but they take up only a small proportion. The existing highway networks have achieved the objective of connections in terms of space, but they can hardly meet the demands of easy and fast transportation. Most of the transport functions remain to be short-distance, and the function of medium- and long-distance transport is Still weak. Apart from railway lines and highways, problems remain in air transportation, such as insufficient airports, backward facilities, inadequate air lines, over-priced tickets and apparent lacking of support airports and branch air lines. As to water transportation, problems include excessive construction of local ports, vicious competition and inadequate large international terminal ports. The above problems have apparently restricted the rapid development of inter-city passenger and cargo transportation in China in the aspect of facility supply

1.3.3 The facility system and the tran8portation organization pattern suitable for modern logistics are not yet networked Since the end of the World War II, the rapid developments of economy globalization and network economy have given rise to higher demand for the transport industry. Modem cargo transportation is no longer simple material movements from place to place, and human society has entered an age of comprehensive logistics. As a new type of transportation management organization pattern, logistics has attracted attention of all countries, and been regarded as the third profit source of productive and economic activities in modem society apart from reduction in raw material consumption and increase in labor productivity. The process of logistics has to be realized through transportation, and the management of logistics industry is, therefore, a system management of transportation process and other related activities. The modem logistics development requires a complete through-transportation system and a highly effective distribution system. However, the segmentation of China's transportation system in terms of construction, management and operation apparently restricts the rapid establishment of the logistics system. (1) Logistics centers and distribution system are not established China's logistics centers and material distribution system have just started to take shape. They are basically characterized by: (a) inadequate material distribution capacity of the logistics centers; (b) irrational distribution, in particular no matter railway road or water transportation, over 70% of cargo circulation and container transfers concentrate in the coastal port cities, While transfers in inland cities are very scarce; and (c) as the operation and management of road, railway and water transportation belong to various sectors, there is an absence of effective link among different modes of transportation, leading to difficulties in effective connection among different modes of cargo transportation and the materialization of multiple means through transport. (2) China's current management and operation systems do not tally with the advanced concept of modern logistics Influenced by the traditional system, China's transportation sectors suffer from apparent sectoral division and segmentation. All activities from facility planning and construction to transportation organization, operation and management are self-contained, and effective connections among localities and between every transportation sector are difficult to make, Which is the fundamental reason Why China's intermodel transport has not yet made any big leap forward in its development. The intermodel transport and modem logistics require that the traditional,, segmented production areas be integrated with the distribution area for comprehensive consideration, so as to achieve minimum cost and maximum profit in the Whole process. (3) The management level of China's current "logistics" enterprises remains low Since the l990s, man of China''s "logistics" enterprises set out to establish broad business networks. They have set up some branch agencies both at home and abroad, Which are equipped with communication and transportation means. However, most of them only provide transport, storage and cargo forward services Rather than overall logistics services. They do not have any in-depth understanding of the operational method of international logistics enterprises, and has a big gap between their operation and the standard operation of logistics service, and therefore, are not yet factual logistics enterprises in modem sense. In general, comparing Chin's logistics with that of the developed countries in the world, and with China''s development scale and speed, there is still quite a gap to fulfil. The development of various linkages of logistics is not stable; transportation infrastructure and means of transportation are not quite developed; the construction funds is not adequate; the transportation facilities are isolated and dispersed; the organic and comprehensive transportation network has not been established; the legal instruments are not complete, the development of multiple through-transportation is still constrained in various aspects, and the level of transportation specialization remains quite low etc.

2. Determination of the Inter-City Transportation Efficiency and its Comprehensive Index Evaluation System

2.1 Definition of Inter-city Transportation Efficiency Inter-city transportation efficiency refers to the ratio of the amount of labor consumption to the results achieved with that labor input in transportation activities, namely, the ratio of factor input to effective output. Transportation is a system concept, therefore, system analysis method is the feasible and effective method in inter-city transportation efficiency study. China has a vast land area, wide distribution of population which is quite concentrated, great difference among localities and between urban and rural areas, comparatively low economic development level, low technical intensity of transportation facilities. backward transportation organization, and incomplete transportation system which is still being shaped. All these determine that the study of the efficiency of China''s transportation system should take development into consideration, and define concepts in the following three aspects: · Allocation efficiency of the transportation system - achieving optimal efficiency through optimization of the structures of various sub-systems within the overall transportation system;

· Economic efficiency of the technology of transportation facilities - raising transportation efficiency by continuous up-grading of various transportation means and raising their technological economic level;

· Efficiency of transportation organization - based on the existing allocation of transportation modes and technical level of transportation means, achieving mutual complementary of advantages of various types of transportation and raising the efficiency of the transportation system through effective transportation management and operation organization.

Among the above-mentioned three aspects, allocation efficiency of transportation system is the basis. Only by deciding reasonable structural allocation according to the technical and economic advantages of various modes of transportation can a transportation system ensure effective operation of the whole system. Under a given allocation structure of transportation, the level of technical and economic efficiency of the transportation means is one of the important factors that affects the efficiency of the system. In a given transportation structure and a given technical level of transportation means, the level of efficiency of transportation organization is the key factor deciding the level of the efficiency of the whole system.

2.2 Comprehensive Index Evaluation Method and the Index System of Inter-city Transportation Efficiency

2.2.1 Comprehensive index evaluation method for inter-city transportation efficiency (1) The introduction of the method The comprehensive index evaluation method refers to a method that contains certain logical connections and has measurement functions which can reflect from different angles, quite comprehensively and systematically, the qualitative characteristics of a certain matter, as well as measure them. The comprehensive index evaluation method is used to evaluate the efficiency of inter-city transportation system, namely, to calculate the value of each sub-index affecting the efficiency of inter-city transportation through classification of some clear and specific indexes. Then various weights are accredited to different indexes according to the level of impact of all indexes to transportation efficiency as reflected by each index. And finally obtain the comprehensive evaluation values for inter-city transportation efficiency within a certain scope and during a certain time period by processing them with mathematical method (non-dimentionalized). Under the condition where the adopted indexes and their accredited weights happen to be equal, the magnitude of the comprehensive evaluation values may reflect the level of inter-city transportation efficiency of various countries or regions in a certain period or of one country or region in various periods. The advantages of this method include that the meaning of each index is specific and clear, the indexes can be compared easily, and calculation is not constrained by regional scopes. The disadvantages of the method are that it is based on too many indexes, needs to be supported by large basic data, quite difficult to conduct comprehensive evaluation, and is affected largely by human factors, such as the determination of the weight for each index. (2) Speci8c calculation steps The specific calculation steps of the comprehensive index evaluation method is shown In the work flow chart below:

The calculation formula of the comprehensive index evaluation system is as follows:

TE= ∑Wi·Si Of which, TE is the comprehensive evaluation value of inter-city transportation efficiency;

Wi is the weight of sequential index Xi, ∑Wi=1 Si is the standard fractional value of the sequencial index Xi;

For positively related index: Si =(Xi-Ximin)/(Ximax-Ximin)

For negatively related index: Sj=(Xjmax-Xj)/( Xjmax-Xjmin)

2.2.2 The transportation efficiency index system

When evaluating the inter-city transportation efficiency with the comprehensive index evaluation method, the choice of proper indexes to build up the index system is essential. In order to guarantee evaluation results, the following principles should be observed when setting up the index system:

·Scientific: namely, the concept of each index should be scientific, with clear, simple and proper scope to reflect the characteristics and quality of the evaluation target;

·Practical Applicability: namely, every index should be supported by sufficient basic data, so that it can be easily quantified, calculated, applied, tested and operated;

·Comparability: namely, indexes for evaluation can be used to make vertical comparisons of different historical periods, as well as horizontal comparisons of different regions in one period; ·Relevance: namely, every index listed in the index system should properly reflect from certain angle the sectoral, regional and enterprise transportation efficiency contents and their internal relationship, combining the indexes into an inter-related organic whole. Based on the above principles and taking into consideration of data obtainability, the following index classification system should be set up: (1) Indexes related to social economy (X1) Indexes related to social economy mainly include labor productivity indexes in physical forms of railway, road and civil aviation transportation sectors. Due to the causes of capital taken