Hu Wei, director of Pudong New Area, said the area wanted to open more of the public sector to international investors with advanced management know-how to achieve sustainable development in environmentally friendly surroundings.

"We are adopting this state-of-the-art concept to improve our management and the efficient use of State-owned assets," said Hu yesterday.

The plant in Pudong involves investment of 670 million yuan (US$81 million) and has the capacity to treat between 1,000 and 1,100 tons of household waste daily. It is the largest incinerator on the Chinese mainland.

Advanced technology and equipment have been imported from France for the project. The plant began trial operations in December last year.

The plant is expected to generate 100 million kilowatts of electricity, some to power the incinerator itself and the majority to be sold.

It was built by the Shanghai Pucheng Thermoelectric Energy Co Ltd - a wholly owned subsidiary of the Shanghai Pudong Development (Group) Co Ltd (SPD), which mainly undertakes investment and financing for important construction projects in Pudong.

"The promotion (of the opportunity to invest in the incinerator) is only a start to Pudong opening its arms to more ambitious and capable investors," Hu said.

He said Pudong will fully support investment in the incinerator, and the local government will subsequently open up more infrastructure projects, such as road construction and landscaping, to the international arena.

France-based BNP Paribas Peregrine has been acting as the financial adviser for SPD to help it raise funds from different channels for the waste-management assets, especially the incinerator project.

"Solid-waste management has a very high development potential in Shanghai and China and the optimal structure of the project will provide a premium opportunity for international players," said Guillaume Dry, deputy group chief executive of BNP.

He said the incinerator will be a landmark transaction in China because it will both contribute to the development of an efficient solid-waste management system and mobilize private-sector resources to optimize China's environmental protection.

SPD President Liu Zhengyi said her company will work out specific tenders in conjunction with its foreign consultants and will announce the results in the media around mid-January.

She said more than 20 international investors have already shown an interest. But she did not give any details about her firm's intentions or expectations.

(China Daily December 26, 2002)