China Railway says Saudi monorail loss temporary

Losses suffered by China Railway Construction Corp on a new Saudi Arabian railway are temporary, President Zhao Guangfa said on Saturday.

Zhao's comments come nearly two weeks after the Beijing based company said it expected to lose about 4.15 billion yuan ($623.3 million) on the A1-Mashaaer Al-Mugadassah metro light rail for Muslim pilgrims, exceeding the company's estimate.

"Ultimately we will see no big losses on this project," Zhao told Reuters on the sidelines of a forum in Beijing.

"The losses so far are temporary ... not every project will make money at the very beginning," he said, adding that the project owner has agreed to talk with China Railway about possible payments and compensation.

Zhao said the Saudi project would not change the company's plan or strategies in venturing abroad.

Shares in China Railway closed up 0.7 per cent on Friday in Shanghai trade.

The firm's shares have dropped five per cent since the announcement on October 25, underperforming a three per cent gain for the Shanghai stock market in the same period.