Dandong seeks cash for growth
DANDONG Port at the eastern corner of the Liaodong Peninsula in Liaoning province intends to expand its handling capacity to 22.19 million tonnes by the year 2020.
'We need three billion yuan [about HK$2.79 billion] of funding to make that possible,' Sha Jianye, director of Dandong Port Office, told the China Daily.
Since 1986, the port has finished building four docks able to handle 1.25 million tonnes of cargo a year.
To achieve the expansion goal, it had decided to increase the number of docks to 28, Mr Sha said.
One of five ports in Liaoning open to foreign cargo ships, Dandong Port was built at the mouth of the Yalujiang River, which forms part of the border between China and North Korea.
The port is 17 kilometres from the Yellow Sea.
Of the 20 docks planned, eight will stand along the river mouth and others will have port pools dug into the muddy shores at the southern end of the water-way.
A chain of islands belonging to North Korea formed the eastern shore of the waterway, and acted as a natural breakwater, so that waves within the waterway and the port pool were normally less than a metre high, Mr Sha said.
With no need to build causeways, costs for building the docks were on average 33 per cent less than normal.
Per-dock costs were less than 80 million yuan, compared with 100 million yuan for Dalian and 140 million yuan for Shanghai, Mr Sha said.
Funding had been achieved via domestic fund-raising and Asian Development Bank loans.
The building of the first four docks cost US$20 million, or 25 per cent of the first batch of ADB loans earmarked for port development in China.
Domestically raised funds totalled 60 million yuan. With state permission, the Dandong Port Office would diversify fund-raising channels to have the money to meet its ambitious plan, Mr Sha said.
The state encouraged foreign and domestic investors to build wholly-owned and joint-venture docks in open ports, he said.
He cited the Shenzhen-based listed company of China Vanke, which invested 140 million yuan to build a dedicated dock in Jinzhou Port, one of the five major ports of Liaoning.
China Vanke became involved in port building because its fast-thriving business in inland Jinzhou called for more economical and convenient port access.
'Foreign investors' interest in building docks in ports in China stems from their need to expand business in the related inland region,' Mr Sha said.
But the port's prosperity depended on the amount of cargo needed to be handled.
Large quantities of goods like steel, coal, timber from east Liaoning and neighbouring Jinlin and Heilongjiang provinces are exported via Dandong every year.
Each year, more than 10,000 tonnes of sodium borate go to Shanghai by sea from the province, and 2.1 million tonnes of coal will be needed to fire a power plant to be built in the port area.
In a related development, the province's Jinzhou Port has been opened to handle oil and cargo, after nine years of local efforts.
The port, on Jinzhou Bay, in the Bohai Sea, has set up two general-cargo berths and one oil berth, handling up to 1.88 million tonnes of cargo and oil a year.
By the end of the year, four general-cargo berths and two oil berths will be in operation, completing the project, with an annual handling capacity of 5.5 million tonnes. Liaoning province and the local government decided in 1986 to build a port on the sandy beach of Jinzhou Bay to ease pressure on the transportation system.
The shortage of funds for construction forced the port to unite with two large national petroleum and chemical enterprises - Daqing Petroleum and Chemical Factory and Jinzhou Petroleum and Chemical.
Jinzhou Harbour (Group) was set up in 1992.
Since then, the Water-Transportation Designing Institute of the Ministry of Communications has mapped out medium and long-term development programmes for the port.