In the first 30 years of the People's Republic, the Northeast, consisting of the three provinces of Heilongjiang, Jilin and Liaoning, was China’s traditional industrial base with a number of key state-owned industries including oil, gas, iron and steel, auto making and shipbuilding. But since the early 1980s, the region was losing its competitiveness and became the so-called “rust belt” as China started transitioning to a market economy.
The medium-sized cities in Liaoning Province were especially vulnerable, as they were reliant on a small number of large, inefficient state-owned enterprises (SOEs) focusing on heavy industry and mining sectors. Severe financial pressure faced by the SOEs put fiscal pressure on and weakened the economic base of the cities. The road and public transport systems in the medium cities of Liaoning had suffered from systemic fiscal neglect, resulting in a serious deterioration of the asset base and under-provision of basic transportation services.
The project was seen as a response to China’s ambitious program to revitalize the Northeast launched in mid-2000s, through urban infrastructure investments in medium-size cities in Liaoning Province. The project covered the cities of Panjin, Jinzhou, Fushun, Benxi, and Liaoyang municipalities, and the county town of Dengta in Liaoyang municipality, and focused on the following areas:
- road improvements in the primary, secondary and tertiary networks that would address current transport problems and bottlenecks;
- rehabilitation of major segments of the participating cities’ road network to improve last-mile access to pedestrians and bicyclists, and finance road maintenance equipment;
- implementation of the National Road Safety Law through enhanced traffic management, monitoring and traffic control systems (including traffic signals and intersection improvements) to improve safety and traffic flow;
- provision of bus priority facilities and improvements in public transport planning and operations; and
- technical assistance in transport planning and management, reform in road maintenance practices and in the structure of the public transport industry, and project management assistance for the implementation agency.
The project was implemented between 2006 and 2013, and helped support improvements in the following key outcomes:
- 43 roads with a total 107 km were constructed or rehabilitated, including 20 km new construction and 87 km of rehabilitation, and 6 bridges.
- Total about 4,478,000 sq m of road surface and pedestrian lane were repaired; traffic lights on 156 km roads and drainage system of 107 km were constructed or rehabilitated; and 141 units of road maintenance equipment and vehicles were procured.
- The automatic traffic control systems in the project cities were improved by installing 824 units of monitoring and control facilities; about 34 km of road sections were improved and 45,600 sq m of road landmarks were installed; and 9 units of equipment and vehicles were procured.
- 20 bus-priority lines, 11 bus depots, and 196 bus stations and shelters were constructed; a large amount of bus route and information signs were installed; and 112 buses were purchased in Panjin.
- eight technical assistance programs, five domestic study tours, and one overseas study tour were implemented. The capacity building program has improved the project cities’ awareness of international and national good practice in the delivery of public transport services.
- The share of roads in good condition increased in the project cities. In Panjin, for example, the share of roads in good conditions increased from 60 to 89 percent. Despite increases in vehicle ownership and traffic volumes, travel times along the 12 monitored routes decreased by margins ranging from 13 percent to 68 percent. A number of black spots were improved in the project roads, especially where school crossings existed in Panjin. Traffic calming measures, such as traffic lights and pedestrian signals near the intersections have led to significant reduction in the accident rates, by margins ranging from 15 percent to 70 percent.
- The satisfaction level regarding public transport service increased significantly across all project cities, with increases ranging from 27 to 48 percent.
Bank Group Contribution
In 2007, the Bank provided a loan of US$218 million, 41.5 percent of the estimated total project cost of US$525.4 million. Due to project scope changes and appreciation of the Chinese currency, the actual project cost was reduced to RMB2,425 million (US$397.44 million equivalents), which was about 24 percent lower than the original estimate. At project closing, US$5.12 million was cancelled from the loan.
In addition, the Bank introduced international good practices such as the integrated corridor management approach and public participation mechanism, and promoted learning and experience sharing among project cities.
The Government of China showed strong commitment to revitalizing the northeast industrial base through infrastructure investments in medium-size cities, and invested US$184.62 million, 46.5 percent of the total project cost. Adequate and timely support was provided during project implementation, including establishing the Liaoning Provincial Coordinating Group chaired by a vice governor to provide high-level guidance and coordination.
After project completion, the assets created under the project, including the main roads, sidewalks, street lights, and drainage system, have been transferred to different municipal agencies for operation and maintenance. All budgets for project operation and maintenance are from the municipal fiscal expenditures. Most project cities have installed substantial traffic management facilities and operate advanced monitoring systems. After four public consultation programs conducted during different stages of project planning, design, construction and operation, the public participation mechanism established by the project has become a regular procedure, including in the cities’ own projects.
A large portion of transport users in the six project cities, including motorists, public transport passengers, cyclists, pedestrians and people with disabilities, benefitted directly from the improvements introduced by the project.
Particularly the disabled people were consulted and given the opportunity to test the design of the accessibility of the bus stops, intersections, and sidewalks, so that the transport facilities were better designed and more accessible to all users.
People in the project cities also stood to benefit from the incremental job opportunities, improved investment climate and enhanced economic competitiveness. Various transport agencies in the cities were also beneficiaries, with improved capacities fostered during the course of this project.