THE Guangzhou Metro Corp says the municipal government will raise an additional three billion yuan (about HK$2.79 billion) early next year to build the underground. How the funds will be raised has not been decided. It will be the last fund-raising exercise for the 12.75 billion yuan Metro Line One project. Guangzhou Metro's general manager, Chen Qingquan, said: 'The funding so far is going well.' Metro Line One is part of a massive infrastructure project in the city that also includes Metro Lines Two and Three and Light Rail Lines One and Two. The 18.2-kilometre, 16-station Metro Line One will run from Guangzhou East to Fangcun. It is scheduled for completion in 1998, and is to be fully operational in the third quarter of 1999. More than 60 per cent of the development money will be raised from overseas loans and the sale of land along the route. The remainder will come from rent on plots above the railway and from government funds. Mr Chen said in Hong Kong yesterday that since construction began in 1993 the city government had committed 4.1 billion yuan to the project, one-third of which was raised from property developments above the lines. The government would allot an additional 1.5 billion yuan until the end of the year, he said. Mr Chen dismissed suggestion that the project was facing financing difficulty. It was expected that more than 10 billion yuan, including US$542.8 million in foreign loans, direct injection of government funds and partial land sales revenue, would be poured into the project by the end of the year. The balance would come early next year. Mr Chen said the government had allocated 24 plots of land totalling 2.9 million square feet along the rail line for real estate development. The government has signed 24 joint-venture contracts worth HK$3.8 billion to develop 19 plots. A large portion of the capital will come from developers. 'Until the first half of 1995, Hong Kong developers, which account for 70 per cent of the total number of investors, have injected 80 per cent of their investment amounts according to schedule,' Mr Chen said. The Hong Kong companies include Hutchison Whampoa Properties, Henderson (China) Investment, China Travel Group. Henderson is the most aggressive, committed to three sites along the line. A consortium formed by Hutchison, Yue Xiu Enterprises, K Wah Stores Co, Ryoden Development, Lippo Group and Elec & Eltek International, will undertake the largest development site of 5.79 million sq ft above the future Huangsha station. Lu Jinqiao, vice-director of Guangzhou Metro, said discussions with overseas property firms for the development of the remaining five sites had been held but no decision had been made. To stimulate investment interest under prevailing market conditions, she said the corporation had tried to fulfil investors' demand, which included offers to increase plot ratios on sites. Ms Lu said the company would not face financing setbacks even if it failed to attract investors for the remaining five sites.