A Comparative Analysis of Evaluation Methodologies for Railway Investments of China and Korea

Economic evaluation methodologies for railway investments of China and Korea are comparatively analyzed. Chinese procedures specified in the new economic evaluation manual of 1997 were compared with those of Korea based on the economic evaluation manual of 1982. As expected those procedures reflect general economic requirements of the respective countries. Several differences in the specification are also noted. Details of the specification of Chinese procedure far exceed Korean specification, while Korean manual is rich of explanation on the fundamental theory. Differences in the procedure of calculating benefits of investments are most conspicuous, and specific requirements of carrying out a optimum opening year analysis in Korean procedure is notable. Despite of these differences in the procedure, two methodologies share same objective of ensuring selection of economically and financially sound railway projects. Both procedures of China and Korea, however, limit their evaluation scope on railways alone. Therefore, they are needed to expand scope of evaluation to encompass the idea of multi-modal or inter-modal evaluation, which will eventually contribute to build truly efficient national comprehensive transportation system.