Asian Development Bank Railway Project

Even as China’s economic growth slows down, there is a severe shortage of freight cars to deliver coal, iron, ore, and oil to continue feeding the mass industry in China. China Economic Net’s Story on Freight Car Shortage Many developmental agencies, like the Asian Developmental Bank, are investing millions of foreign and domestic dollars to build new railways. ADB Report on $548 Million Railway Project in Yunnan Province However many human rights organizations are against the ADB and other such institutions, arguing that they are opening up China and other developing countries to resource extraction, human displacement, labor exploitation, and ultimately imperialistic domination by First World Countries. Click here to check out the Revolutionary Worker’s Campaign Against the ADB Projects in China

Asian Development Bank Railroad Project
In the Yunnan Province of China

Patricia Kim
Developmental Studies 10
December 6, 2004

On December 3, 2004, the Asian Development Bank (ADB), announced the launch of the construction of a 167-km railway from Dali County to Lijiang City in the Yunnan Province of China. The ADB is funding this $548 million project with the collaboration of Agence Francaise de Development of France, China’s Ministry of Railway, and the Yunnan provincial government (ADB 2004:1). To fully understand the motives and consequences behind this railway project and suggest possible improvements, one must first examine the project’s location, the goals of the development agency, and finally the underlying reasons and effects behind the project.

Yunnan Province, the site of the ADB railroad project, is one of the less industrialized provinces of China. Located in the southwestern tip of the country, Yunnan has a population of 41.44 million, of which about 38% are racial minorities, with 7 million living under the poverty line of 300 yuan per capita (China 2004:1). The Province of Yunnan is also known as the “Kingdom of plants, animals and home of non-ferrous metals and medicinal herbs.” It boasts the country’s most diverse collection of natural resources, and is an area of China that still has clear air and sunshine due to high elevation and relative lack of industrialization (China 2004:1). The area of Yunnan in which the railway is to be constructed is rich in natural resources, but is “poor and remote” according to the ADB because of the lack of commercial transportation and modernization (ADB 2004:1).

The Asian Development Bank, the development agency heading this massive railway project, is a “for-profit” bank that is made up of 63 different member countries that either loan or borrow funds for development projects in Asia and the Pacific. Created in 1966, the ADB is a huge institution that loans over $6 billion a year to developing countries, working closely with the World Bank, IMF, and UN. The two largest donor (money-lending) member countries of the ADB are the United States and Japan. These two countries have the biggest vote in the ADB, and therefore have the greatest control over what sort of projects the bank initiates. Some argue that the ADB serves as a tool of expanding First World imperialism and neo-colonialism by allowing donor countries to move in and “develop” Third World countries their own way (Revolutionary 2001:1). However, the Asian Developmental Bank’s mission statement proclaims that its main objectives are to reduce poverty, promote economic growth, support human develop, and protect the environment in the Asian Pacific region. This railroad project, (on the surface), fits the general objectives of the ADB because the construction of the railroad according to the ADB, will reduce poverty by connecting the remote and mountainous regions of the Yunnan Province to the rest of China’s prospering market, creating over 7,000 railroad jobs for the poor residents of Yunnan, lowering transportation costs, increasing the speed of personal and commercial travel, and generating tourism (ADB 2004:1).

Although the railroad development project may seem very beneficial to the Province of Yunnan at first glance, there are deeper aspects to it when examined closely. First of all, although the ADB may be funding the construction of the railroad system in the name of alleviating poverty in southwestern China, there are probably underlying interests that are causing this profit-oriented agency to finance such a costly project. For example, the agency reports that there are “abundant natural resources” in the area of its proposed railway. Perhaps the ADB is equally or even more interested in gaining access to these resources than in protecting the environment and helping the poor. The Revolutionary Worker Online group claims that the ADB promotes neo-colonialism by providing “easier military and foreign corporate access to natural resources by building infrastructure that is geared to the extraction of natural resources by foreign companies. (Worker, 2004:1).” The claim that the ADB is more materially than environmentally and humanitarianly concerned is shown by the fact that building a railroad with multiple rail stations will lead to deforestation and pollution that will destroy the natural “Kingdom of plants, animals and home of non-ferrous metals and medicinal herbs” that Yunnan is famous for. This claim is further confirmed by the fact that this project will displace 8,000 poor people who currently live off the land that lies in the path of the proposed railway. The ADB claims that there is a “special” resettlement plan for the people being kicked off their land that will give them “preferential” treatment for employment during construction, allocation of commercial space near railway stations, and job training (ADB 2004:2). But the ADB is basically imposing a new lifestyle of manual labor on the poor who will have to leave their homes and give up their traditional, self-reliant ways of life such as farming and fishing. Also the ADB does not guarantee full-time employment for the displaced, but merely states that they will be given “preference” in employment during construction. The ADB does not even think beyond the construction of the railroad, and what is to become of the displaced people who have lost their livelihoods.

The ADB railroad project is a development scheme that serves the interest of big investors as opposed to the local people of the Yunnan Province. The ADB is definitely an advocate of neo-liberalism and the “trickle-down” theory. The ADB pushes private-sector investment and “rapid development” arguing that by opening the country to huge corporations, there will be “a rise in job opportunities and the “distribution” of economic benefits that will eventually reduce poverty and bring about sustainable development.” The railroad is a good example of this idea of development because it will allow the huge West Yunnan Railway Company, along with many foreign consulting firms to come into Yunnan, employ the poor, and “reduce” poverty. However the trickle-down theory may not necessarily work because of the exploitative and cheap labor practices of big corporations, and the ultimate extraction of natural resources in Yunnan. So the underlying interests of the project are not for the poor or any other proclaimed goal of the ADB, but rather for the investors of the ADB, and ultimately big businesses. The needs of the poor are marginalized and used as an excuse in rapid development and “neo-colonization” of China (Pleumarom, 2004:1).

If I were to suggest improvements to this project, I would say that ideally, no one should build a railway at all. I personally feel that enough of our world is industrialized and that it is time for us to begin conserving the small portion of nature we have left on this earth. Also it is time to stop feeding the corporate greed and imperialistic tendencies of the First World. I do not want to see Yunnan’s natural kingdom fall into the hands of selfish “developers” who plan to ruthlessly extract natural resources. However, since the natural kingdom is inadequately feeding the poor in the Province of Yunnan, some sort of compromise has to be made to alleviate poverty. Perhaps instead of cutting across 8,000 people’s homes and farms, railroad planners can try to find a route that is more isolated even thought the railway may be longer or harder to build. Also perhaps the ADB can research and fund trains that are relatively emission-free and less polluting. There are many small changes that can be made to the railway project that may reduce profitability for the ADB, but definitely increase the benefits for the natural kingdom and people of Yunnan.

Development is a complex process that can improve and harm nature and society at the same time. The Asian Developmental Bank railway project in the Province of Yunnan, China is a typical development project that characterizes many of the profit-oriented development agencies of today, in which the interests of big investors precede those of the local people and of nature. However, sometimes, like in poverty-stricken Yunnan, the need for development is real. I believe that the best solution to the dilemma of development must be overcome with the collaboration developmental agencies, the government, and local people to find a good balance between preserving the old and constructing the new.


Asian Development Bank. “ADB Supporting Railway to Bring Growth to Poor and Ethnic Communities in Southwestern PRC.” 2004. 6 Dec. 2004

China.ORG. “Yunnan.” 2004. 6 Dec. 2004

Pleumarom, Anita. “Globalization and Tourism: Anti-People and Anti.” 2004. 6 Dec. 2004

Revolutionary Worker Online. “ADB: Banking on Misery in Asia and the Pacific.”
2001. 6 Dec. 2004


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