The World Bank's Board of Executive Directors approved today a US$100 million loan to China to help finance transportation improvements in Fuzhou City and Nantai Island in Fujian Province.

The Fuzhou Nantai Peri-Urban Development Project will assist the development of Fuzhou by financing public transport and roads to help develop peripheral areas of Nantai Island; and helping the city develop a strategy that promotes fiscally, socially and environmentally sustainable development of Nantai Island.

Fuzhou, the capital of Fujian Province on China's east coast, is growing rapidly. Its per capita income is forecast to increase to US$10,000 a year by 2020, and the population is forecast to grow to over 2.0 million by 2015.  Auto ownership has increased by more than 50 percent since 2001.  To cope with the pressures of increased demand for urban growth, the centerpiece of Fuzhou's 1995-2010 development strategy is the development of Nantai Island, located to the south of the city center. 

The World Bank-supported project will provide the Municipality of Fuzhou with investment financing for road and public transport access to Nantai Island. In addition, the Bank's technical assistance will help the city to strengthen urban development planning by promoting public transport while integrating environmental concerns upstream in the planning process. The Bank will also be involved in helping improve urban design, preservation of sensitive and historic neighborhoods, and increasing the city's capacity to phase and stage development in a market environment while ensuring the quality and competitiveness of public transport.

"As in the last two decades, increased urbanization will continue to be a pillar of China's growth and poverty alleviation strategy," said Shomik Mehndiratta, World Bank task manager for the project. "Fuzhou, like other fast-growing coastal cities, needs to accommodate the influx of new residents, primarily from poorer rural areas, as well as the increasing demands of the existing population.  However, international experience shows that successful urban expansion depends on solid planning and implementation."

"Unless urban growth is directed around relatively dense clusters along well-defined corridors, the competitiveness of public transport suffers, which usually leads to interminable congestion, poor air quality, and ultimately degradation in the quality of urban life," Mehndiratta said, noting that municipal investments in infrastructure that are too far in advance of public demand can expose cities to significant financial risk."

"Buses, the mainstay of public transport in are critical for personal mobility. The Bank financed project supports Fuzhou in promoting an agenda of urban growth and mobility."

The project will finance:

Roads and bridges, including Nan Jiang Bin Lu, the 2nd phase of the 3rd Ring Road and the Kuiqi Bridge. 

Infrastructure to develop the public transportation system in Fuzhou and enhance the accessibility of Nantai Island to public buses. This will include the construction of an overnight parking and maintenance depot for buses, a passenger interchange terminal, and a dispatch center. In addition, management and technological enhancements to improve the operation of the public bus system;

Technical assistance will support the development of public transport plans, capacity building for regulation, planning and operations of public transport, and capacity building to support land development management.

The loan for the Fuzhou Nantai Urban Development Project has a maturity of 20 years, including a five year grace period.

(China.org.cn December 16, 2005)