Merchants eyes 15b yuan port project
China Merchants Holdings (International) plans to invest in a 15 billion yuan (HK$17.01 billion) port development in Zhangzhou, Fujian, in a move to cash in on burgeoning trade ties across the Taiwan Strait, according to top city officials.
The Hong Kong-listed port operator is likely to take an unspecified stake in the planned project, which involves constructing as many as 10 berths in the fourth phase of the Zhangzhou port zone, said Liu Keqing, Communist Party secretary of Zhangzhou.
The company's unlisted parent, China Merchants Group, is expanding aggressively in the Zhangzhou port zone to capitalise on closer trade and economic relations with Taiwan under the State Council's Straits West Coast Development Zone roadmap. Liu Wei, China Merchants Zhangzhou Development Zone deputy general manager, said China Merchants Holdings was in talks with the parent about the potential investment in the fourth phase.
Currently, it is a joint venture between the parent firm and the local government's investment arms.
'It is natural the listed company will eventually invest in the planned development,' Mr Liu Wei said.
'It has a [60 per cent] stake in the existing Zhangzhou port, which has performed well despite the global financial crisis.'
The new berths will handle bulk cargo, such as logs, steel and agricultural products, exported largely to Taiwan and Southeast Asia, Mr Liu Wei added.
He said 'parts' of the new berths would be ready for operation in 2012. That year is the State Council's medium-term target for the Straits West region to become a national leader in scientific innovation, with higher living standards and specialising in direct links with Taiwan.
The roadmap to make Fujian an experimental zone knit closer with Taiwan will be extended to 2020, when the prosperous region is expected to emerge between the Pearl River Delta in Guangdong and Yangtze River Delta in Jiangsu.
Mr Liu Keqing said the port expansion was only part of a sweeping number of infrastructure projects on Zhangzhou's agenda.
A 10km bridge linking the Zhangzhou port to Xiamen costing 12.5 billion yuan will be built. He said that three rail lines running as far as Shenzhen and Guangxi would be constructed, while superhighways connecting Chengdu and Guangzhou would be added to facilitate intensifying trade.
Zhangzhou is not the only Fujian city embarking on a spending spree in infrastructure. Others, such as Fuzhou, Quanzhou, Xiamen and Putian, are racing to have railroad networks and power plant projects completed 'at an unprecedented pace' to spur cross-strait trade, according to senior provincial officials.
A China Merchants Holdings spokesman would say only that the company had yet to take a stake in the planned expansion of the Zhangzhou port.
Additional reporting by Charlotte So