Kyrgyzstan hails 'historic' China-financed power line

BISHKEK, Kyrgyzstan (AFP) - Ex-Soviet republic Kyrgyzstan on Friday inaugurated a Chinese-financed power line officials say will bring energy independence to the country, one of the many projects Beijing has sponsored in the region.

The 450km Datka-Kemin power line is expected to save Kyrgyzstan millions in transit fees, as its electricity will no longer pass through neighbouring Uzbekistan and Kazakhstan.

"We are witnessing a historic event," Kyrgyz President Almazbek Atambayev said at the power line's inauguration in the provincial town of Kemin. "Workers in the energy sector, especially veterans, are well aware of this. Today we can say that Kyrgyzstan gained energy independence."

In the Soviet era, the electrical grids of Central Asia republics were unified, meaning that as much as one third of Kyrgyzstan's domestically-produced energy transited through Uzbekistan and Kazakhstan before returning to the country.

The US$390 million (S$548 million) deal to build the power line was struck with the Chinese Tebian Electric Apparatus Stock Company (TBEA) in 2010.

China's economic influence in Central Asia has grown tremendously in the last decade, surpassing its traditional partner Russia in regional trade and encompassing deals worth tens of billions of dollars with energy-rich Kazakhstan, Turkmenistan and Uzbekistan.

China, to which Kyrgyzstan owes more than US$1 billion in external debt, is also financing a number of other key projects in the resource-poor country.

In June, Beijing allocated US$300 million in credit to help Kyrgyzstan build a North-South road across its territory.

Since the mid-1990s China has pledged to build a railway up to 300 kilometres-long linking its restive western Xinjiang region to Uzbekistan via Kyrgyzstan.

The railway - which would cost over US$2 billion - is opposed by many in Kyrgyzstan, who argue it could lead to overwhelming migration from the country's 1.3 billion-strong neighbour and add to growing dependence on Beijing.

These projects complement Beijing's Silk Road Economic Belt, a vision of massive investments in infrastructure and trade links across Eurasia to increase its heft in the vast region.