CKI Signs Third Project In RMB 2 Billion Jiangmen Road Network Plan
27 January, 1997 - Hong Kong
Following the signing of three Fushun City power contracts last Tuesday (January 21), Cheung Kong Infrastructure Holdings Limited (CKI) announced that it signed a contract on Saturday (January 25) to invest in the Chaolian Bridge in Jiangmen, Guangdong Province - the third project in its planned RMB 2 billion investment in the Jiangmen road network.
Mr H L Kam, Managing Director of Cheung Kong Infrastructure Holdings Limited, commented, "We have been in discussions for development of the Jiangmen road network, and the Chaolian Bridge contract signing represents another step forward in our road developments. With three out of five road network contracts already signed, we can concentrate our efforts on the remaining two contracts."
CKI has a 50% equity investment in the 1.5 km Chaolian Bridge, which is currently under construction and scheduled for completion in two years. The joint venture period will last for 31 years. CKI has committed to a RMB 70 million investment in the bridge, bringing its total current interest in the Jiangmen road network to over RMB 400 million.
The contract signing and approval process for the first two projects in the Jiangmen road network was completed in 1996. Of the two projects, the Jiangsa Road is already operational and recorded a daily traffic volume of over 14,000 vehicles in 1996; while the Jianghe Road is currently under construction and scheduled for completion by early 1999. CKI has made capital contribution during 1996, and both projects are currently generating revenue for CKI.
The remaining two projects in the Jiangmen road network are two roads with a total length of over 120 km. Should the contracts materialise, CKI will invest another RMB1.6 billion in the two roads.
Jiangmen, located in western Guangdong Province, has jurisdiction over five cities - Xinhui, Taishan, Kaiping, Enping and Heshan. With a total area of 9,418 square kilometres and a population of over 3.7 million, it is an important industrial centre in the Pearl River Delta, and reported a GDP of over RMB 37 billion in 1995. Jiangmen is also the ancestral home of over 3 million overseas Chinese.
Attending the bridge contract signing ceremony in Hong Kong, Mr Si Tu Jie, Standing Deputy Mayor of Jiangmen Municipal People¡¦s Government, remarked, ¡§Jiangmen, with its coastal location in the Pearl River Delta, is an important transfer point linking major road and shipping transportation networks. Hutchison Whampoa's container terminal, developed two years ago at the Jiangmen pier, as well as CKI's 1996 investments in toll roads and bridges have made a major contribution to Jiangmen's infrastructure development."
"Jiangmen is a fast-growing economy with dynamic potential. In line with our clustering strategy, CKI would become a major partner in the total development of this booming city - thus becoming an integral part of Jiangmen's rapidly-growing economy," explained Mr Kam.
"As of today, CKI has three road projects in Jiangmen, and Hutchison Whampoa Limited, another member of the Cheung Kong Group, operates a container terminal in the city. CKI has signed a letter of intent regarding a water plant in Jiangmen, and is in negotiations for several other infrastructure projects in the city."
Mr Kam continued, "As with our existing project clusters in Nanhai, Shantou and Shenyang, we expect the synergy of the Cheung Kong Group's investments in Jiangmen will have a multiplier effect on the overall development of the city's economy."
"This is CKI's second contract signing of 1997. Over the past few months, we have been in discussions for several other road, bridge and power projects throughout the PRC. We are in negotiations for over 1,000 km of road contracts and over 2,000 MW of power contracts, half of which are already in the letter of intent or agreement phase," said Mr Kam.
Since its listing in July, CKI has nearly doubled its number of signed PRC infrastructure contracts from 19 to 36 - for a total investment amount of around RMB 8 billion. Mr Kam concluded, "We now have four teams in four different regions of China discussing new projects. With the near doubling of CKI's signed contracts in the past six months, and two additional contract signings in two different regions within the last week, we look forward to continuing this momentum."