(Yicai Global) April 10 -- Nearly 30 state-owned enterprises under the Chinese central government ('central enterprises') expressed support for the Xiongan New Area in Hebei within a week of the government's announcement of its establishment.
They pledged to contribute to the development of the new area. Many of the first movers are SOEs from the infrastructure and transportation markets. Chen Derong, general manager of China Baowu Steel Group Corp., told Yicai Global the company was studying the current situation in Xiongan, and would offer full support for its development.
"During the initial stages, construction in the Xiongan New Area may require approximately three million tons of steel every year, and the demand may exceed 10 million tons with the launch of more construction projects in later stages. It may even reach 20 million tons a year during the peak period," Wang Guoqing, head of Lange Steel Information Research Center, told our reporter.
The intensity of environmental protection and construction of underground pipe systems and rail transit networks in the Xiongan New Area will be significantly higher than all other special economic development zones and national new areas, and it will certainly lead to new demands for steel, Chen Kexin, chief analyst at the research center, predicted.
"China Railway Construction Corp. [HK:1186] has no reason not to be deeply involved in the establishment of the Xiongan New Area," the company stated, adding that it has set up a dedicated leadership group to carry out extensive research into the development of Xiongan.
China State Construction Engineering Corp. [SHA:601668] said that it would serve the needs of construction projects in Xiongan with the best resources and production facilities, and would draw up plans regarding organizational operations, financial input and relevant mechanisms within the shortest time possible.
As major player in capital construction, China Metallurgical Group Corp. [SHA:601618] stated that it had many projects in Hebei, and was looking forward to collaborating with Xiongan in future.
State-owned iron pipe producer, Xinxing Cathay International Group, pledged to actively participate in underground pipeline and pipe gallery construction in the Xiongan New Area, and contribute to the development of the area as a 'sponge city.'
Xiongan lies some 60 kilometers from Beijing's new airport, which is currently under construction. Airlines permitted to operate at the airport now have more ambitious plans.
China Eastern Airlines has chosen the new airport as its main operating base. It will ramp up coordinated operations concerning the construction of the airport and the development of the Xiongan New Area, and create a highly efficient local passenger and freight network to facilitate economic opening in the new area, its chairman Liu Shaoyong asserted.