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China lending more to undeveloped western areas

NANNING - China's State Development Bank (SDB) plans to increase the amount of loans and the proportion of loans it issues to the country's western areas, to keep in line with the country's Western Development drive.

According to SDB Vice President Yao Zhongmin, SDB plans to issue 75.5 billion yuan (US$9 billion) in loans to the western area, accounting for 30% of the credit scale of the bank this year, and the proportion is 3.1 percentage points higher than in 2003.

The loans will be mainly used to support such key construction projects as the west-east gas transmission, west-east power transmission, water conservancy hub and traffic trunk lines.

The term of loans for highway projects may be extended to 25 years; for toll roads in urban area, 18 years; and for toll-free road and bridges, 12 years.

In terms of loan rate, SDB in principle will not raise loan rate for the western area and may even lower the rate for some projects.

Yao disclosed that SDB plans to offer 33 million yuan of technical loans to support provinces and autonomous regions in the area to conduct infrastructure planning, industrial development planning and ecological environment planning.

By the end of 2003, SDB had promised to issue 3.88 billion yuan of technical loans to the western area, accounting for 52% of the total the bank had promised to issue.

(Asia Pulse/XIC)

Nov 24, 2004

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