The 464km railway journey from Kunming to Hekou is among the most spectacular in China. Departing on the plain in Kunming, the narrow-gauge track joins the down-stream waters of the Nanpan River before making a slow ascent towards the plateau near Mengzi. The rail line then crawls across snaking precipices, through the tropical Nanxi Valley, to arrive at the shores of the Red River, the muddy banks of which mark the border separating China and Vietnam.
The railroad itself is a vestige of ambitious French colonialism, 'whose sponsors once imagined a vast Indo-Chinese empire. The track, which extends beyond the border south-east to Vietnam's port city Haiphong, was constructed to facilitate the extraction of resources and penetration of French imports into China's south-west interior.
From the Red River north, French engineers and Chinese coolies laboured five years to complete the trunk line, boring 150 tunnels and building 3,422 bridges. Construction of the Yunnan section began in 1906 and the first train arrived in Kunming in 1911. Working in the humid and malarial Nanxi Valley was dangerous and costly but the rail-road, the first to link land-locked Yunnan, is said to be France's finest engineering achievement in east Asia.
The electrified railroad now joins the more than 1,600km of Yunnan rail line ?as well as 70,279km of provincial high-way ?that are already in service. Their impact on provincial development has been immediate.
Rail and road construction, Yunnan's vice-governor Liu ling comments, is the underlying source of wealth creation now taking place in the province. In the 20 years since China opened its doors to the outside world, Yunnan has posted compound average gross domestic product growth of about 10 per cent a year, which by 1996 raised per capita real income for urban residents to Yn4,977 (US$600) and per capita net income for rural residents to Yn1,229 (US$148).
Moreover, the vice-governor says, the building of transport infrastructure has hastened development of the province's only economic mainstay ?cigarette manufacturing ?which during the years between 1990 and 1995 recorded a more than 50 per cent growth in output and a 90 per cent growth in profits. Taxes paid by Yunnan's 10 largest cigarette manufacturers account for 70 per cent of Yunnan's annual revenue, and fill state coffers with Yn80m every day.
Construction of airports and development of the province's civil aviation industry has also helped boost Yunnan's tourism trade, which has been expanding at an annual rate of more than 25 per cent since 1990.
In 1996 Yunnan hosted more than 750,000 overseas and 20.2 million domes-tic visitors, earning for the province Yn7.3bn. The opening of airports at Jinghong, capital of the province's south-western Xishuangbanna prefecture, and the historic city of Dali, in the province's northern Erhai Lake district, has led to a more than 50 per cent growth rate in Yunnan regional travel.
A test of endurance
According to Li Zhaogang, operations director for the Nanning-to-Kunming (Nankun) Railway ?a 899km trunk line completed on December 1 last year ?connecting Yunnan has required a vigorous mix of patience, endurance and ground-breaking technology. That is due primarily to the province's treacherous topography, which is as vexing to build across as it is breathtaking to behold.
Construction of the landmark Guiyang-to-Kunming line in the 1950s, the Chengdu-to-Kunming line in the 1960s and the Nanning-to-Kunming line in the 1990s are the leading Chinese rail-way engineering achievements of their respective decades, he says. Negotiating the, complex mountains, valleys, and caves to build the Nankun Railway, for example, demanded the efforts of thou-Golf an course The fairways are emerald green, the sky porcelain blue and the golf balls fly in the crisp mountain air. Welcome to Spring City Golf & Lake Resort in the sculptured hillsides around Lake Yangzhonghai, 48km east of Kunming.
Launched in January, Spring City boasts what is certain to be the main-land's finest golf facility — an 18-hole, jack Nicklaus-designed championship course lying alongside a second championship 18-hole course designed by Robert Trent Jones. Only the Nicklaus holes are currently in play, but a walk across the manicured fairways leaves no doubt that the international consortium behind the project understands that golf is a serious business.
Spring City's foreign financial muscle is led by Keppel Land of Singapore, which holds a 40 per cent stake in the province's overseas business, meanwhile, has risen sharply with the establishment of international air links between Kunming and Bangkok, Kuala Lumpur, Singapore and Hong Kong. Visitors travelling from Thailand, Malaysia, Singapore and Hong Kong account for more than half of the province's foreign guests.
Growth in regional contacts has speeded regional investment. Hong Kong is the largest 'overseas' investor with contracted investment of US$780m, accounting for about 43 per cent of total foreign investment in the province. The top Hong Kong investor is Hutchisondevelopment. Other investors include Singapore's government-backed investment arm Temasek Holdings, Indonesia's Salim Group and Hong Kong's World Wide Shipping. The government of Yiliang County, which provided the land for the 500-hectare development, holds a minority 20 per cent stake.
Spring City's first phase investment, which includes the two golf courses and a 48-room luxury clubhouse facility, amounts to US$55m, which makes the project Yunnan's largest overseas joint venture. If all goes according to plan, ground-breaking ceremonies will be held this year for the project's US$75m second phase. That will include 50 residential villas and the mainland's first Club Med facility, a 200-room mountain and lake resort located directly below the twin golf courses. Further investments in a third hotel, more than 1,000 residential units, and convention and cultural centres are Whampoa. Hong Kong is also Yunnan's largest trading partner, with bilateral trade between the two regions between 1993 and 1997 reaching US$1.8bn.
In December 1997, Yunnan signed US$64m-worth of contracts with Hong Kong businesses at an investment fair held in the SAR.
"We in Yunnan are part of the Southeast Asian region," vice governor Liu explains. "Our proximity is part of the province's development advantage." Promoting that advantage, particularly through cross-border trade, is one of Kunming's primary tasks. "During these years, development of border trade hason the drawing board, and could drive up total investment in the project to more than US$600m over the next decade.
The only hitch may be Asia's economic crisis, which is likely to sideline Spring City's most sought-after customers: Thai, Malay and Singapore golf enthusiasts. Stung by a free-fall in the baht, Thai visits to Yunnan, which peaked at 138,000 in 1996, shrunk by at least 50 per cent last year. Visits from Malaysia and Singapore also dropped a reported 40 per cent during the second half of 1997.
"Our short-term market is people in Southeast Asia and the drop-off in the economy will certainly affect us here," says Mr Arthur Yeo Hui Kong, who is Keppel Land's assistant general manger for regional investment. "But we are going ahead because we believe the market is still there. Golfers are very influential. And if they have money, they are going to come."
progressed according to the needs and desires of those involved," Liu adds. "A great amount of what we're exporting is in demand in the markets of our trading partners. We are receiving what we want in return."
That hat meant a thriving business in exporting light machinery, capable of producing everything from cigarettes, processed sugar and lifestyle products, to Yunnan's less developed neighbours, Vietnam, Laos and Burma. In return, the province has been importing a range of primary processed goods and as well as natural resources.
It makes economic sense, the vice-governor says: "In many sectors our manufacturing enterprises utilise the equipment of a fully developed country ?and because of that our products bear heavy costs that our neighbours are not fully able to pay. That's why we need to export entire sets of equipment."
The vice-governor stresses the fact that the province's future economic development does not depend exclusively on deepening relations with Yunnan's neighbours. "The most important factor is self-development," he says. .''We are not talking about partners in the same bed, but of a mutual co-operative relationship between separate parties."
Still, the province is quickening its cross-border links? often unilaterally ?with action that will only advance the province's more than US$2.2bn annual foreign trade. Construction on the province's 800km leg of a Kunming-to-Bangkok expressway, for example, coin-
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