Guangzhou to press ahead with subway

PUBLISHED : Saturday, 22 May, 2004, 12:00am
UPDATED : Saturday, 22 May, 2004, 12:00am

The construction of Guangzhou's subway system would not slow down despite the central government's call to curb fixed asset investment, a city official said yesterday.

Gan Xin , director of the Guangzhou Development and Reform Office, said the city would stick to its schedule to complete 200km of subway lines by 2010.

Mr Gan's remarks, quoted in the Yangcheng Evening News yesterday, were in response to calls by Municipal People's Congress deputies for the government to consider slowing down the project.

Noting that the project had so far run up debts of more than 7.6 billion yuan, a member of the National People's Congress Standing Committee, Liao Shufang, said the project had become far more expensive than the municipal government could afford.

Mr Liao, a long-time critic of subways, said few operators around the world were making money. Some of those that were profitable, such as Hong Kong's MTR, made their money chiefly from property development.

The 7.6 billion yuan debt has been incurred in the first three phases of the subway project.

The completed Subway No1, built at a cost of 11.2 billion yuan, had outstanding debts of 5.8 billion yuan. Subway No2 had borrowed 1.4 billion yuan and Subway No3, 450 million yuan.

Officials said the cost of subway construction was dropping as a result of better management and technology.

But the rising cost of construction material has affected the budgeted investment for Subway No5, construction of which is scheduled to begin on Friday. Investment in the line, linking Fangcun to Huangpu, has been raised to 16 billion yuan from 13.9 billion yuan.

Lu Guanglin , general manager of the Guangzhou Subway Company, claimed the project should not be merely profit-driven. He said it should be viewed as a public service first, and profits should come second.

Referring to the No3 line, which links Guangzhou and Panyu , Mr Lu said if passenger figures alone were considered, not enough people were using the service to justify construction of another line. But he predicted passenger flow would increase in one or two decades.