The builder of Taiwan's billion-dollar bullet train project moved a step closer to completing the project by its October target date after borrowing T$40.7 billion (US $1.2 billion) from local banks on Monday.
The Taiwan High Speed Rail Corp, a T$480 billion rail system that would shave three-and-a-half hours off the five-hour travel time between the north and south ends of the island, has encountered repeated problems over the past few years.
It plans to borrow another T$20 billion from an unidentified foreign bank and raise US $2 billion in European convertible bonds later this year, executives said.
The project, whose launch was delayed for a year, has hit numerous snags in fund-raising efforts since its inception in 1998. Developers found it difficult to attract potential investors because of worries over the progress of its construction.
"The government often faces inaccurate accusations and rumours with its huge infrastructure projects, which gives us a lot of problems," Transport Minister Kuo Yao-chi said at the signing ceremony of the syndicated loan on Monday. "But I believe these rumours won't hold for long, especially once the high-speed rail project operates safely and smoothly," Kuo said.
As of June, the project was more than 96 percent complete, High Speed Rail executives said. "The construction is close to completion, which has cut any project-related uncertainties or risks to the minimum," said Nita Ing, chairwoman of High Speed Rail.
Monday's deal was High Speed Rail's second syndicated loan, after it borrowed T$323.3 billion from another local bank consortium in 2000, executives said.
With the latest plans and the company's own capital of more than T$105 billion, High Speed Rail will have more than enough funds for the project, executives said.
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