Using a 8.9 billion yen (around US$71 million) government loan from Japan, which makes up 47 percent of the total investment, the project, the largest of its kind in Shandong, kicked off yesterday.

Over the next four years, over 1.2 billion yuan (US$149 million) in funds, including the loan from Japan, is scheduled to be spent on the delta's infertile land to turn it into Shandong's largest grain-producing and vegetable-growing base, a leading provincial official said.

"It is of vital importance for Shandong, China's leading agricultural province, to use overseas funds to accelerate the utilization of its farming potential in the Yellow River Delta," Vice-Governor Chen Yanming said.

Addressing the project's opening ceremony, Chen was confident that the project can push forward the province's overall agricultural development and the growth of its rural economy.

Through introducing advanced technology and management experience from Japan, Chen said he hopes major breakthroughs can be made in improving the delta's ecological environment, and in particular improving its low-lying saline lands, developing environmentally-friendly farming techniques and speeding up the mechanization of local agriculture.

In line with China's imminent entry to WTO, which will bring China's agricultural sector fierce competition from overseas agricultural producers, the project is also expected to introduce local agriculture to international economic operations under market rules, experts say.

Unveiling the cornerstone of the project with Chinese officials, Shimada Junji, the first secretary of the Japanese Embassy said on behalf of his ambassador that he hopes the government loan from Japan will promote friendly cooperation between the two countries and their peoples.

During the 2000-04 period, a multi-functional infrastructure, including water conservancy systems, agriculture, forestry, aquiculture and power supply will be built within the project zone, which covers 127,000 hectares of land currently suffering from chronic drought, flood, infertile soil and insufficient drainage facilities by using the Japan's loan.

Under the program, three reservoirs will be expanded to hold 104 million cubic meters of water with 300 kilometers of drainage ditches, over 2,600 pump stations and two hundred kilometers of irrigation canals will be built.

(China Daily 11/21/2000)