Announcement of China Shapes Up for Shipping Needs on December 23, 1992

FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.* Telephone: (202) 477-1234 IBRD News Release No.93/4lAsia Contact: Erin Burns (202)458-2210 External Affairs - EAPVP CHINA SHAPES UP FOR SHIPPING NEEDS Washington, D.C., December 23, 1992 --- To meet the burgeoning demands of trade, China is improving facilities at Shanghai Port, already the tenth largest in the world. The World Bank is supporting the effort with a loan of $150 million approved yesterday. While China has expanded physical facilities for trade in the past decade, port operations are not meeting the demands created by rapid economic growth. The Government is giving high priority to eliminating this bottleneck by modernizing and expanding ports' capacities. This is expected to facilitate both international and domestic trade. Shanghai Port is the hub of international and domestic trade for China. It consists of some 140 berths on the Huangpu River, many of them in the city center. In 1991 it handled about 100 million tons of port traffic. This volume is expected to increase by a third by 2005. The Shanghai Port restructuring and development project will make the port more efficient and reshape it to handle trade well into the 21st century. The project will promote terminal specialization in order to maximize efficiency in an environmentally sound manner. Cargo operations will be gradually transferred away from the congested city center to outlying areas, alleviating current environmental problems and releasing valuable urban waterfront land for other commercial uses. The project is an integral part of Shanghai Municipality's reform and restructuring process. Specifically the project will help finance the provision of equipment for four berths at one of the planned new cargo terminals; the construction of, and provision of equipment for, coals berths at a second new terminal; the purchase of equipment both for replacement and for additions to the existing fleet in the present port areas; and technical assistance and training for the Shanghai Port Authority (SPA) in the areas of corporate planning, financial management, tariff restructuring and operations management. This is the Bank's seventh port project in China. Lending to the first six project totalled approximately $600 million. The total cost of the Shanghai Port project is approximately $424 million. The SPA is providing $274 million in project financing. The loan is extended for 20 years, including five years of grace, at the Bank's standard variable interest rate, currently 7.60 percent. NOTE: Money figures are expressed in U.S. dollar equivalent.