• Fri
  • Dec 26, 2014
  • Updated: 1:46am
BusinessEconomy
DEVELOPMENT

China's economic planner approves 170b yuan of building projects

Rail and electricity plans have been approved in cities like Fuzhou, Beijing and Urumqi

PUBLISHED : Thursday, 29 November, 2012, 12:00am
UPDATED : Thursday, 29 November, 2012, 3:46am

The National Development and Reform Commission (NDRC) has approved more than 170 billion yuan (HK$210 billion) of railway and electricity projects on the mainland.

"The country needs infrastructure spending to drive its GDP growth. These approvals indicate rail construction is speeding up. But it's uncertain if rail construction projects will continue to grow as quickly after one year. It depends on the funds available," said Masterlink Securities analyst James Chung.

On Monday, NDRC approved a 31.2 billion yuan project to build seven metro rail lines totalling 212 kilometres in Urumqi, the capital of Xinjiang Uygur Autonomous Region from 2012 to 2019, as well as an 18.2 billion yuan programme to build the 26.3km metro line 2 in Fuzhou, the capital of Fujian province, according to NDRC's website.

On the same day, NDRC approved a 25.7 billion yuan project to build an 88.5km track between Fuzhou and Pingtan.

Earlier in this month, NDRC approved a 70.7 billion yuan project to add 89km of new metro railway lines to Beijing between now and 2016, as part of the government's expansion of the capital's metro construction plan.

The new lines include a rail link connecting Beijing airport with the city's subway system. Under the revised government plan, Beijing will have 664km of metro railway by 2016.

"To raise the city's transport capacity and alleviate congestion in the city centre, to encourage the development of new urban zones and encourage the use of public transport, NDRC has approved recent plans to modify Beijing's metro rail plan," the NDRC said.

It has also approved a 14.5 billion yuan project for the first phase of a second metro line in Nanchang, the capital of Jiangxi province, plus four power plants totalling 10.37 billion yuan.

Separately, Tianjin Binhai New Area Construction & Investment Group plans to invest 69.2 billion yuan in the Binhai New Area of Tianjin from 2012 to 2016, according to a bond prospectus of the company which is owned by the Tianjin government.

The investment will primarily be in roads, but will also include property and environmental projects. Tianjin's former party secretary, Zhang Gaoli, was recently appointed to the Politburo Standing Committee, the nation's highest leadership circle.

The Binhai New Area covers 2,270 square kilometres and a population of three million. Its GDP has grown at an annual 20 per cent from 381 billion yuan in 2009 to 620.7 billion yuan last year, the bond prospectus said.

However, the debt of Tianjin Binhai Group reached 88.45 billion yuan on June 30.

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