Chinese province gets road loan

The Asian Development Bank (ADB) has approved a US$ 200 million loan for road construction in the Anhui province of central China.

The loan is specifically for the Anhui Integrated Transport Sector Improvement Project which, once completed, is expected to benefit four million of China's poorest people. The US$ 1.35 billion project includes the construction of a new 139 km long motorway in the province's northern region as well as the upgrading of 452 km of existing roads.

"An underdeveloped transport system is one of the major barriers to development and poverty reduction in Anhui, particularly in the rural areas," said Xiaohong Yang, principal transport economist in ADB's East Asia department. "A well-developed transport network will help the central region capitalise on its strategic location and transform it into a major hub linking China."

The ADB loan has a 25 year term and a five year grace period and will come from the Bank's ordinary capital resources. A further US$ 119.1 million of funding for the project will be provided by China's Ministry for Transport, while the Anhui Provincial People's government will provide US$ 116.2 million. US$ 598.8 million in co-financing loans through the Industrial and Commercial Bank of China and China Bank as well as US$ 320.9 million from Anhui Communications Investment Group will complete the financing for the project.