Governor Schwarzenegger Inspects China's upcoming high-speed rail

The Governor Arnold Schwarzenegger is engaging in a little window-shopping of China's new high-speed train lines while peddling Californian exports and tourism in the world's second-largest economy.

His own state budget $19 billion in the red, Schwarzenegger says he is hoping for some "creative financing" from Asia to help lower costs and get California's proposed high-speed rail lines up and running.

Industry experts say cash-rich China may be best placed to help with funding, and less risk averse than others whose banks are still recovering from the financial crisis. That could prove a key competitive advantage as it goes head-to-head against better established high-speed rivals rail in Asia and Europe.

"That is something very attractive about the Chinese which the Europeans will find very difficult to compete with," said Michael Clausecker, director general of Unife, the Association of the European Rail Industry. "Even in America, finance is a scarce resource. Rail investments need a lot of investment up front."

China has invested huge prestige, and tens of billions of dollars, in its high-speed rail industry -- building on mostly European know-how acquired in joint ventures with Siemens AG, Alstom SA and to a lesser extent Japan's "Shinkansen" bullet train operators. It is gearing up to fight for a chunk of what Unife estimates to be a 122 billion euros ($155 billion)-a-year global market for railways.