Near-Term Development Programs of
           Petrochemical, Environmental Protection
                  and Chemical Projects
Petrochemical projects
(1) Nanhai petrochemical project
The first phase of Nanhai integration petrochemical project
jointly funded by China Offshore Oil Corporation and Shell
of Holland has been approved  by  the  Chinese  Government
(CCR No. 8, page 6). The project has a total investment  of
45 billion U.S. dollars and is the largest foreign- funded
enterprise in China. The approval  of  the  project  shows
that the attitude of the  Chinese  government  toward  the
foreign  investment  in  key  projects  is  becoming  more
flexible, and also brings hope to  the  approval  of  more
than a dozen similar large projects of chemical processing
.
(2) resin production
Resins produced in China can only meet 50% of the  domestic
demand of 11 million tons, and  import  has  to  be  made.
  China   will   make   great   efforts   in   constructing
petrochemical plants to solve the resource shortage.  More
than 10 large and  comprehensive  petrochemical  complexes
will be constructed before 2010, needing an investment  of
around 5 billion U.S. dollars. The ethylene capacity  will
be increased from the  present  3. 08  million  t/a  to  5
million t/a in 2000 and 8  -   10  million  t/a  in  2010.
Foreign companies have been invited to  be  joint  venture
partners. For example, Philips Petroleum has  participated
in following 3 projects:  It  is  making  the  feasibility
study of a 600 000 t/a ethylene cracking unit  in  Lanzhou
in which Philips Petroleum and Lanzhou Chemical Industrial
Corporation each holds 50% stakes;  It  is  exploring  the
possibility of constructing a styrene-butadiene  copolymer
complex in Jinshanwei; It is also  trying  to  expand  the
capacity of a polyethylene unit already under construction.
(3) import of large units
Petrochemical and chemical units  must  reach  the  minimum
production scale during the Ninth Five-year Plan period to
acquire competitiveness in the international market.   For
example, the minimum capacity is 300 000 t/a for  ethylene
units, 5 million t/a for oil refining units, 60 000 -  200
000 t/a for ammonia units and 50 000 t/a for caustic  soda
units. The technologies and equipment for such world-class
units are not available in China and have to  be  imported
from abroad. China Petrochemical  Corporation  has  placed
order for 2 refined terephthalic acid units,  one  with  a
capacity of 225 000 t/a and the other with a  capacity  of
250 000 t/a. The first unit has a contract  value  of  100
million U.S. dollars, and will be constructed  by  Chiyoda
and Marubeni with the technology from Amoco.   The  second
unit also has a contract value of 100 million U.S. dollars
,   and  will  be  constructed  by  Mitsui  Engineering   &
Shipbuilding and Itoh in Tianjin with the technology  from
Mitsui Petrochemical.
Environmental protection projects
The Chinese Government  has  announced  a  50  billion  USD
program of combating acid rain. Acid rain has polluted 30%
of the Chinese  territory,   and  losses  have  also  been
inflicted on  Korea  and  Japan.   The  program  has  been
approved by the State Council. Measures will be  taken  to
effectively control the discharge of  carbon  dioxide  and
slow down the spreading of acid rain  areas  before  2000.
The project will be concentrated on 1.09 million square km
of the territory.
Chemical projects
An investment of over 32 billion U.S. dollars will  be  put
in the chemical industry during the Ninth Five- year  Plan
period, around 10 billion U.S. dollars in construction  of
new projects and another  10  billion  U. S.   dollars  in
renovation of existing units and renewal of equipment. The
chemical industry will open wider to the outside world  to
absorb 12 billion U.S. dollars from abroad before the  end
of 2000. The target is 20% higher than 1996. 5 500 foreign
-funded chemical enterprises have  already  been  approved,
and long-term cooperation agreements will be  signed  with
over 20 multinationals.
(1) agrochemicals
Agrochemicals mainly  refer  to  chemical  fertilizers  and
pesticides. The output of chemical fertilizers will  reach
29 million tons in 2000. New chemical fertilizer complexes
will be constructed in Hainan and Xinjiang,  and  existing
plants will be renovated and expanded. In  spite  of  such
efforts, 25% of the chemical fertilizer demand, especially
potassic fertilizers and phosphate fertilizers, will still
have to be met by imports.
(2) chemical processing regions
The following 3 regions in east  coastal  areas  have  been
defined by the  state  to  have  development  priority  of
chemical processing:
Bohai  Bay:   Dalian,   Tianjin  and  Qingdao; East  China:
Lianyungang, Nantong, Shanghai, Ningbo and  Wenzhou; South
China: Fuzhou, Xiamen, Shantou, Shenzhen, Guangzhou, Zhuhai,
Zhanjiang, Beihai and Hainan.
(3) special chemicals
China is seeking foreign partners  to  help  speed  up  the
development of special chemicals, such as fine  chemicals,
pesticides, pharmaceuticals and engineering plastics.  300
new varieties of special chemicals will be increased  each
year during the  Ninth  Five- year  Plan  period  and  the
proportion of fine chemicals will reach 45% (being 60%  in
the United State and Europe). Special chemical zones