Projects Mapped out for West Foreign Investment Encouraged in Infrastructure and Environment

China will launch 10 key infrastructure and environmental projects in its western region this year and encourage foreign involvement, said Zheng Xinli, spokesman for the Sate Development Planning Commission (SDPC).

The 10 projects will lay the foundation for developing China's western regions. These projects have secured funds from central and local governments, enterprises banks and overseas investors.

Foreign funds have already been secured for three projects: an elevated light railway in Chongqing Municipality and two water conservancy hubs in Zipingpu in Sichuan Province and Shapotou in Ningxia Hui Autonomous Region. The two flood-control projects are expected to cost about 7.5 billion yuan (US$903 million).

"We have to improve infrastructure and ecological conditions since developing the western areas is a long-term strategy," Zheng said.

The 10 projects include the construction of a 955-kilometre-long Xi'an-Hefei section of the Xi'an Nanjing railway, and a 640 kilometre-long Choingqing-Huaihua railway, with investment of 23.2 billion yuan (US$2.19 billion), respectively.

According to the official, China will also build several trunk highways and the Xianyang International Airport in Xi'an. It will also work to create a regional air network with Chengdu, Xi'an, Kunming, Lanzhou and Urumqi as hubs.

A 935-kilometre-long gas pipeline will be built to link the Qaidam Basin, a place rich in natural gas and crude oil from Xining, capital of Qinghai province, to Lanzhou, capital of Gansu Province. The pipeline will have the capacity to move 2 billion cubic metres of natural gas annually.

As a major part of development, some 340,000 hectares of farm land along the upper reaches of the Yangtze River and Yellow River will be reconverted into forest or posture, and 430,000 hectares of waste land and hills will be reforested.

The projects also include the building of a potash fertilizer plant in Qinghai, building schools and improving higher education.

Song Mi, director of the Department of Basic Industries of the SDPC, said at a press conference yesterday that the central government will increase investment in central and western areas this year, especially in infrastructure projects such as railways, highways and airports.

To facilitate the implementation of developing China's western regions, the country is expected to introduce a package of new policy incentives to attract more overseas funds into the central and western regions.

Zhang Xiaoqiang, director of the Department of foreign Capital Utilization of the SAPC, said yesterday that the country will open more areas to foreign investment, ease restrictions on stock-holding for foreign investors, and make substantial progress in utilizing foreign capital through new means other than establishing overseas-funded ventures.

The official revealed that China will soon announce a list defining major industries in the central and western regions so as to better guide overseas investment in these regions.

He said more flexible ways of using foreign investments such as build-operate-transfer project financing and transfer of operational rights will be introduced to western areas.