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Chihiro Atsumi, minister for Economic Affairs at the Japanese Embassy in China said he will continue to try to convince Japanese officials of the need to give China such aid, although many Japanese now say the Chinese economy has grown so fast it no longer needs assistance.

In Guang'an of Sichuan Province, hometown of late Chinese leader Deng Xiaoping, a 18.2-hectare forest was finished after one-year construction with Japanese assistance worth 2 million yuan (US$240,000)

Forest

The forest contains trees and flowers, including cypress, pagoda trees and the oriental cherry tree.

"The programme in Guang'an is to promote the experiences we had in the earlier aforestration in Liangshan on the upper reaches of the Yangtze River," said Yoshimoto Miki, a Japanese expert engaged in work in Liangshan.

"The flood in the Yantze River in 1998 is partly because forests on the upper reaches of the river are damaged and Liangshan is within the area," Miki said, explaining why Liangshan was chosen.

Meanwhile, in Chongqing Municipality in Southwest China, the Japan Bank for International Co-operation has provided the local government with a Japanese loan of 2 billion yuan (US$240 million) for the construction of a single-track urban railway .

Another 2.3 billion yuan (US$280 million) is from a domestic bank loan and government investors, said Li Xiumin, vice-manager of the Chongqing Rail Transit General Corporation.

The railway is the city's first urban railway line, and is expected to be the country's first ever single-track line.

Started in 2000, the first-phase project from Jiaochangkou to the Chongqing Zoo is expected to be put into trial operation this year. The whole line from Jiaochangkou to Xinshancun will be completed next year.

The effort has been listed as a major project for the country's western development.

Single-track urban railways were first constructed in Japan and there are more than 20 such railway lines in Japan, the United States and Australia.

"Such railways are more capable in climbing mountains than double-track ones and they cause less noise," Li Xiumin explained.

Chihiro Atsumi said that he realized loans to China are still necessary after he took office in Beijing in August of last year.

"Although the Chinese economy has developed very fast in recent years, I recognized gap among different areas in the country," he said.

Atsumi stressed that some problems in China, such as the environment, are not only problems for China, but concerns for Japan as well. The two countries are neighbours.

He vowed to try his best to explain to Japanese people the true situation in China.

Governmental loans provided by Japan to China have decreased since 2001. The figure has dropped an annual 25 per cent consecutively in 2001 and 2002. Statistics for last year were not available.