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Infrastructure project flurry helps spur economy amid headwinds



Infrastructure project flurry helps spur economy amid headwinds

The nation's infrastructure-building rush is expected to remain in high gear this month as a market observer reported that nearly 20 high-priority projects worth over 1 billion yuan ($138.3 million) each have been approved in just the first two weeks of this month. The construction trend comes as China seeks to spur its economic momentum by boosting effective spending on highways, railways and other public works, analysts said.

According to data from cninct.com, an online infrastructure market information aggregator, there were 17 major infrastructure projects worth at least 1 billion yuan each approved in the first two weeks of this month.

The online platform is operated by Sichuan Suitang Science and Technology Co Ltd, a company listed on the National Equities Exchange and Quotations (NEEQ) board, also known as the "new third board".

Such a round of intensive approvals this month follows a similar trend in May, when the platform's report said that a total of 563 project bids worth at least 500 million yuan each in the infrastructure sector were placed nationwide, worth a total of some 775.5 billion yuan.

Among them, projects related to buildings and engineering made up the largest share, with a value of around 273.2 billion yuan, followed by highway engineering and municipal engineering projects, taking up 176.8 billion yuan and 111.9 billion yuan, respectively.

In addition, there were 18 single projects or bids valued at over 5 billion yuan, including 11 over 10 billion yuan, among which six were highway projects, cninct.com said.

Such enhanced efforts in the sector are acknowledged by experts and market insiders as the nation is still confronting pressure from relatively weak domestic demand.

"Currently, domestic demand in China is still not strong and is weighing on the nation's economic recovery. To this end, infrastructure investment should still be given full play as it tends to have a large scale and is usually guided by the government, which thus has the advantage of faster commencement and is more effective in shoring up domestic demand," said Long Chaocan, an investment consultant with China Galaxy Securities Co Ltd.

China Railway Construction Corp, the second-largest bid winner in May in terms of project value according to the cninct.com report, said its teams are making accelerated steps on some key projects.

China Railway 24th Bureau Group Corp Ltd (CR24), a CRCC unit, is working on a school project in Cixi, a city in Zhejiang province. With the pouring work of the project's basements having been completed last week, the company's construction workers are stepping up efforts to accomplish the completion of the main teaching buildings.

Covering 46,227 square meters, the school was planned by the local government to provide a consistent nine-year education program for more than 2,400 local students after its completion. It is also a key infrastructure project in the city's five-year development plan, CR24 said.

During construction, the builder said it has also arranged on-site visits for local residents and district officials to have a better idea about how "past, present and future students want their school to be built", the project manager with CR24 said.

Several rounds of exchange meetings have been held by the project team to this end, which helped the team promote construction quality and efficiency, he said.

"Despite high temperatures, construction progress of the project is on a steady track. We will deliver the project that is key to local livelihoods on time," the manager said.

In terms of railway projects, the company said its workers are sweating it out in mountainous Sichuan province boring the Banshantian Tunnel, a key project for the Xi'an-Chongqing High-speed Railway.

With a length of 4.14 kilometers, the two-rail tunnel cuts through complicated fault zones in Dazhou, Sichuan, and is the first railway to be laid under Daba Mountains.

As a major expansion project listed in the nation's five-year development plan for high-speed railways, the railway aims to further integrate development of the Yangtze River region and western China, CR24 said.