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Fri, Aug 18, 2006 - Page 10 News List

China berates officials over power plant

AP , BEIJING

China has reprimanded officials in the Inner Mongolia region for building an unauthorized power plant and warned others against similar projects amid attempts to cool the overheated economy, state media said yesterday.

The warning was issued on Wednesday during a meeting of China's Cabinet, the State Council, that was chaired by Premier Wen Jiabao (溫家寶), the official Xinhua news agency said.

Provincial officials were told to "learn a lesson from the incident" and to follow the central government's investment controls or face disciplinary action, the China Daily newspaper said.

The World Bank said in a report on Tuesday that it expects China's economy to grow by 10.4 percent this year, and by a still-robust 9.3 percent next year.

The Chinese government has warned that excessive investment could ignite inflation or cause a financial crisis by leaving companies and banks with dangerously high debts that they are unable to repay.

A handful of Inner Mongolia's senior leaders were forced to write self criticisms, demoted, or warned for approving or failing to stop the power plant project where rushed construction resulted in a building collapse last year that killed six people and injured eight, Xinhua said.

Xinhua said the reprimand of the region's chairman, Yang Jing (楊晶), who holds a rank equivalent to a Cabinet minister, and two of his deputies, Yue Fuhong (岳福洪) and Zhao Shuanglian (趙雙連), marked the first time senior local leaders have been sanctioned for ignoring macroeconomic control policies.

In total, some 10 officials were disciplined and two building contractors face prosecution for their involvement in the building of the 2.88 billion yuan (US$350 million) Xinfeng Power Plant, the China Daily said.

The government has tried to rein in what it says is dangerously fast growth in investment in factories and other fixed assets by raising interest rates, tightening bank credit and imposing curbs on new building projects.

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