The bank will provide US$200 million for the third stage, which will be used for Shanghai's urban environmental protection in terms of solid waste treatment and air improvement. This is the first of three loans from the World Bank over the next eight years.

The sewage treatment project, corresponding with the city's new three-year-long environmental plan, will use 70 percent of the initial loan.

The project aims to solve drainage problems in the north of the city and improve the efficiency of existing facilities in the downtown area to collect sewage.

A new sewage treatment plant will be built at a cost of over 500 million yuan (US$60.5 million) at Zhuyuan in the city's Baoshan District. It will be completed by 2006 and have a daily treatment capacity of 500,000 tons.

"More than 4 million residents living in a 300 square kilometer area will benefit from the project," said You Qizhong, a manager of Shanghai Municipal Sewage Co Ltd, one of the groups receiving part of the APL.

Statistics show the city's sewage treatment rate was 40.3 percent in 1999 and 60.4 percent in 2002 with over 4,000 kilometers of underground collection pipes.

In the next five years, the treatment rate is expected to reach 75 percent, according to the Shanghai Water Authority.

"The APL will support the city's efforts to become an international economic and trade center with the highest standards of urban environmental quality," said Geoffrey Read, task manager for the project.

"It will both enhance the quality of life of its citizens and help Shanghai to continue to attract high-quality foreign investment."

(China Daily September 15, 2003)