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Railway ministry secures $7.9b in loans: report

Updated: 2011-11-04 19:23

(Xinhua)

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BEIJING - China's Ministry of Railways has secured 50 billion yuan ($7.89 billion) in loans from banks, the Economic Information Daily reported Friday, citing Wang Mengshu, academician of the Chinese Academy of Engineering, as saying.

The loans, with the proceeds from bond issues and funds through other channels, will be used to pay off some of the ministry's creditors and finance railway projects that are currently under construction, the newspaper quoted Wang, also deputy chief engineer of the China Railway Tunnel Group.

The ministry has been faced with fund-raising difficulties after the fatal high-speed rail collision in July raised concerns about the reliability of the country's high-speed network.

Construction on more than 10,000 km of railways was halted in recent months due to lack of funds, leaving workers without pay, according to media reports.

At the end of June, the ministry's outstanding debt increased to 2.09 trillion yuan with its asset-liability ratio standing at 58.5 percent, official data showed.

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