Global rail developments offer opportunities for British expertise

Global trends are acting as a spur to major rail developments worldwide — many of which offer high value opportunities to skilled British firms.

Of all the major transport infrastructure projects currently under construction globally, the majority are to be found in the rail sector, causing a surge in commercial contracts in all parts of the rail industry. According to a 2011 report by Datamonitor, the global passenger rail sector grew by 6.4% in 2010 to reach a value of $169.4billion. By 2015 they expect it to have a value of $209.6 billion — an increase of 23.8%. Investment levels are high: China assigned approximately €60billion to the extension and improvement of its rail network in 2009 alone.

Rail is undoubtedly the transport of the future. The trends driving this rail renaissance are varied, and include economic, environmental, speed, safety and comfort benefits.

Whereas road freight adds to traffic congestion and carbon emissions, moving freight on rail is greener and more cost-effective. Then there is the urbanisation factor. Increasing numbers of the world’s population now live in urban areas, making train travel essential for business and leisure purposes. By ensuring the easy mobility of goods and people — and quickly and reliably connecting growing communities and key locations — rail has become a vital way for a country to enhance its economic competitiveness.

Opportunities

UK expertise in the rail sector is recognised worldwide. This is why global rail infrastructure projects offer major opportunities to firms working in every area of the UK rail industry, from planning, design, project management, construction and maintenance to financing, regulation, train control and operations. Global projects now offering contracts for UK firms include the UAE, which plans to link all seven of the Emirates by rail. Then there is the expansion of the metro system in Brazil, ahead of the FIFA World Cup in 2014 and the Olympic Games in Rio de Janeiro in 2016. Malaysia’s Klang Valley MRT project is a proposed 3-line 150km system, with a first line scheduled for completion in 2016. Oman is planning to build its first rail system over the next 10 years, with a project spend valued at $2.2billion. Russia, meanwhile, is running an extensive investment programme to modernise its rail infrastructure, including significant station upgrades in Moscow. Hong Kong is looking to expand its rail network by 55% and in Singapore there are £30billion plans to expand the MRT system by 2020. Major rail projects in Denmark, India, Taiwan, Kuwait, Qatar and Saudi Arabia also present myriad opportunities for British firms.

Specialist

The UK’s own rail heritage is renowned. The country has one of the most complex and intensive rail networks in the world, carrying around 1.3billion passenger journeys every year and 400,000 tonnes of freight every day — yet it continues to deliver increased rail capacity and improved customer service in a sustainable and safe way. Innovative developments continue, with substantial Government support for investment in both existing infrastructure and ambitious new projects, such as Thameslink, Crossrail and High Speed 2

UK firms have used their experiences of working in the demanding domestic market to help overseas clients. Ashurst, for example, is an international law firm headquartered in London which has worked on a number of the major rail projects in the Gulf region in the last few years. It has been advising the Kuwaiti Government on the legal and regulatory issues surrounding the $8billion Kuwait metro project and has also advised on the Makkah Metro in Saudi Arabia.

Successful

“UK firms have been very successful in the overseas rail market,” says Ashurst partner Lee McDonald, who specialises in transport and infrastructure projects. “I think there are a number of reasons for this: we have a very capable, experienced and sophisticated rail industry in the UK that has been developed using a number of different structures. UK expertise is in demand in railways right around the world, covering disciplines such as engineering, construction, operations, structuring, regulatory feasibility and so on. Equally, given cultural and language connections, many countries often look to the UK for expertise.”

Tony Di Rosa is Regional Director for Asia, the Far East and Oceania at engineering, design and construction giant Balfour Beatty Rail International. He believes that the sheer scale of Britain’s rail network is so challenging that it has motivated and driven excellence in the UK industry. “The vastness and variety of the UK networks — whether they are main line, mass transit or suburban lines — and the sheer quantity of traffic using these lines has resulted in the industry having to work in a challenging environment,” he says.

Combining experience in the UK — including the City of London — with successful delivery of projects overseas, British companies have unrivalled expertise to offer the burgeoning number of rail schemes being planned around the world.