According to its original application to the CAAC, the cargo company
was co-established by Shanghai Airlines, Sino Prime Ltd and Juniper Estate BV.
Total registered capital of the company is 124 million yuan (US$15.5 million).
Shanghai Airlines owns 55 per cent of the joint venture, while Sino Prime Ltd
and Juniper Estate BV hold 25 per cent and 20 per cent respectively.
Meanwhile, Nanjing Lukou International Airport in East
China's Jiangsu Province released a statement that two foreign airport
authorities, Singapore's Changi Airport and the Amsterdam Schiphol Airport of
the Netherlands, are competing to purchase 40 per cent to 45 per cent of its
shares.
The airport did not release the value of the shares. According to a
memorandum of understanding signed by the Nanjing airport and its Singapore
counterparts in June last year, the Singaporean investor planned to invest 1.5
billion yuan (US$187.5 million) and 1.6 billion yuan (US$200 million).
Currently, the airport is wholly-owned by the State-owned Assets Supervision
and Administration Commission of Jiangsu Provincial Government.
CAAC's foreign investment policy says foreign investors can hold up to 49 per
cent of an airport. As both the Singapore and the Dutch investors were unwilling
to be joint strategic partners, the Nanjing airport has to choose one to be its
foreign partner.
The enthusiasm of foreign investors was stimulated by a State Council
resolution that stipulates governments at all levels end their subsidies to the
local airports by the end of last year.
In April 2005, the Hong Kong Airport Authority agreed to inject a total of 2
billion yuan (US$250 million) into Hangzhou Xiaoshan International Airport in
the capital of Zhejiang Province, equivalent to a 35 per cent stake in the
airport. Two months later, Germany's Frankfurt Airport announced a plan to buy a
25 per cent stake in the Ningbo Lishe International Airport in the port city of
Ningbo in Zhejiang Province.
Foreign investor's enthusiasm is in sharp contrast with the cool stance of
China's central government towards airport investment.
In a recent seminar on future development of Chinese airports, Yang Guoqing,
vice director of the General Administration of Civil Aviation of China, said the
CAAC plans to set a cap on investment in airport construction. The total
investment size of airport construction will be capped at around 140 billion
yuan (US$17.5 billion) between 2006 and 2010.
Yang's speech shattered the earlier market speculation that investment in the
planned construction and renovation of 86 airports on China's mainland would
exceed 300 billion yuan (US$37.5 billion) by 2010.
The 300-billion-yuan estimation was touted in aviation circles during the
drafting of a plan for the development of the civil aviation industry between
2006 and 2010.
Analysts say the investment cap and the rumoured size of
300 billion yuan are likely a result of negotiations between the central
government and local governments during the drafting of the airports'
development plan.
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