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Development

US$130m Push for Tibet Train

[WTN-L World Tibet Network News. Published by The Canada Tibet Committee. Issue ID: 2006/01/09; January 9, 2006.]

RailPartners, a China-based private rail company, plans to take out a US$130 million (HK$1.01 billion) loan to finance a luxury "Dragon Express" train service between Shanghai and Tibet that seeks to emulate such trains as the famed Orient Express.

Tim LeeMaster, The Standard, Hong Kong
Monday, January 09, 2006

RailPartners, a China-based private rail company, plans to take out a US$130 million (HK$1.01 billion) loan to finance a luxury "Dragon Express" train service between Shanghai and Tibet that seeks to emulate such trains as the famed Orient Express.

Societe Generale, France's third largest bank by assets, has been mandated to arrange the 15-year loan for the company, which has entered into a joint venture with a unit of the Ministry of Railways.

A small number of other banks may be brought in to provide funds before closing syndication in the first quarter, a person familiar with the situation said.

The money raised will go towards purchasing and outfitting 51 carriages to be built by a joint venture between Canada's Bombardier and a mainland train manufacturer.

The train service from Shanghai to Lhasa - the capital of Tibet - is aimed at well-heeled foreign tourists as well as the growing number of wealthy mainlanders, and is expected to cost about US$1,000 a day.

RailPartners and Qinghai-Tibet Railway, a division of China's train service, plan to begin offering the service in April 2007.

Other stops include Beijing and Xian. It is to be modeled on classic rail journeys, such as the Paris to Istanbul Orient Express and the Bangkok to Singapore Orient & Eastern Express.

The six-day Paris to Istanbul run costs US$7,380, while a suite on the four-day journey between Bangkok and Singapore costs US$3,620. The cheapest ticket is US$1,780.

Carriage interiors on the Dragon Express will be designed by Aman Resorts, famed for boutique, high-end hotels in exotic locales such as the Caribbean island of Turks and Caicos and the French Polynesian island of Bora Bora in the Pacific.

The cars are to feature king-sized beds, baths and showers, in-room dining and butler service.

The new service could prove a popular draw for tourists with cash to burn now that the plush Three Gorges cruises on the Yangtze River, which attracted rich foreigners throughout the 1990s, lose their luster as the picturesque valleys continue to slowly sink beneath the rising waters caused by the completion of the mammoth Three Gorges Dam.

For less well-off travelers, a government-run standard train service to Lhasa will begin in July, taking two days from Shanghai, at about half the cost of flying.

The 1,142-kilometer Qinghai-Tibet railway from Golmud to Lhasa, featuring the highest train tracks laid in the world, was completed in October.

The project has drawn the fire of a wide range of critics, who question its economics and argue that the increased migration and commerce that accompany it threaten the already-precarious Tibetan way of life.

Environmentalists also charge that the construction itself threatens the ecology of the unpopulated, fragile Qinghai-Tibet Plateau.

RailPartners is a unit of Shanghai- based TZG Partners, a real estate and hospitality venture founded by Ben Tsen and Josh Brookhart.

The company is also building the 325-room Regent Ningbo Hotel in Ningbo, a port city south of Shanghai.

Tourist numbers in the mainland reached 42 million in 2004, up 48 percent year on year, and China was the fourth most popular world destination, according to the World Tourism Organization.


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