December 8, 2008 / 6:11 AM / 11 years ago

China to spend 150 bln yuan on railways in coal region

BEIJING (Reuters) - China plans to spend more than 150 billion yuan ($21.8 billion) over the next six years to add some 2,000 km of railway track in the coal-rich region of northern Shanxi province, the Xinhua news agency reported on Sunday.

The construction projects are expected to help boost domestic demand and counter the impact of the global financial crisis, said Zhang Baoshun, Communist Party Secretary of the Shanxi provincial committee.

Last month China announced a sweeping 4 trillion yuan ($586 billion) economic stimulus package of spending over the next two years, with a large portion of the funds targeting infrastructure projects such as roads and railways.

It was not immediately clear how much of the Shanxi spending might be included in that stimulus programme.

In a separate report, Xinhua said Beijing had authorized 100 billion yuan to be spent in the fourth quarter on economic stimulus programs, including 11.4 billion yuan for construction of a new high-speed Beijing-Shanghai rail line.

Officials from Shanxi province and the Ministry of Railways said construction on at least three new rail lines will begin in the first half of 2009, according to the Xinhua report.

New rail lines would enable coal from Shanxi, which accounts for a third of China’s coal output, to be shipped directly to coastal ports in Shandong province, Zhang said.

Shanxi is expected to have 5,300 km of railway track by 2015, up from 3,300 km currently, Yang Zhongmin, head of the railway ministry’s department of development and planning, told Xinhua.

($1=6.874 Yuan)

Reporting by Ken Wills; Editing by Kim Coghill

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