Dec. 10 – The Asian Development Bank (ADB) has approved a US$1 billion loan to China for a groundbreaking program to build environmentally cleaner and energy efficient railways for the underdeveloped southwestern regions of the country.
The loan will supplement Beijing’s US$25 billion plan to develop railway services in its southwestern region that also includes Guangxi, Guizhou, Sichuan, Chongqing, and Yunnan Provinces.
The seven year program will be managed by the Ministry of Railways and is also part of the government’s economic stimulus package launched last year at the height of the global financial crisis.
The program is the first of its kind to focus on energy efficiency, environmental sustainability, and improved safety through the bank’s transport operations and in China’s transport sector. It is also the bank’s first investment in the Chinese transport industry to use the multitranche funding mode which times the release of funds with project readiness.
“The program will deliver broad benefits including reduced economic losses and lower energy bills for the government, reduced carbon emissions, safer trips for the public, faster more cost-effective freight services, new employment opportunities in underdeveloped areas, and increased integration of the southwest with its neighbors, including Vietnam and the Greater Mekong Subregion,” said Manmohan Parkash, Principal Transport Specialist in ADB’s East Asia Department in a statement.
The funding will be used to buy a moving train fault detection system, and smart electronic devices that will help cut power consumption and carbon emissions.
