The massive investment will power several railway construction projects both inside the province and linking Yunnan with neighboring regions, said Minister of Railways Liu Zhijun.

    Yunnan now has over 2,300 kilometers of railways. As part of the country's drive to boost economic growth in western regions, the province is building and upgrading railways.

    China has mapped out three lines in the province that are part of an ambitious 5,500-km Trans-Asia Railway, which will begin in the provincial capital of Kunming and travel through Laos, Myanmar, Thailand, Vietnam, Cambodia and Malaysia before terminating in Singapore.

    Construction of a 142-km Yuxi-Mengzi section on the eastern line from Yunnan to Vietnam has begun. Preparatory work has also started on a 146-km section from Yunnan to Hanoi, capital of Vietnam.

    "The Chinese section of the railway connecting with Vietnam will be fully completed in 2010," said Wang Minzheng, deputy director of the Yunnan Development and Reform Commission.

    Preparation is under way on the 599-km Yuxi-Mohan section of the line to Laos and on the 366-km Dali-Ruili western section from Yunnan to Myanmar.

    The Dali-Ruili railway is expected to cost 10 billion yuan (1.2 billion U.S. dollars), according to Wang, adding that the upgrade of the Kunming-Dali railway will be completed by 2010.

    The railway construction will link China more closely with the Association of the Southeast Asian Nations (ASEAN) member countries, namely, Indonesia, Malaysia, Thailand, the Philippines, Singapore, Brunei, Cambodia, Laos, Myanmar and Vietnam.

    The trade volume between China and ASEAN member countries reached 130 billion U.S dollars in 2005, 16 times that of 1991 when it was less than 8 billion U.S. dollars.

    However, railway transport can only meet 30 percent of the transportation demand which has arisen from the booming trade between China and ASEAN nations.

    Railway construction is a concrete step towards creating a China-ASEAN free trade zone, which will be set up in 2010, according to experts.

    The Trans-Asia railway was initiated by former Prime Minister Mahathir of Malaysia in 1995 at an ASEAN summit and is expected to be completed in 2015.

    China plans to build 17,000 kilometers of new railways over thenext four years, bringing its total length of railways to 90,000 kilometers by 2010.

    Yunnan will build more than 1,500 kilometers of new railways by 2010, according to the Kunming Railway Bureau.

    Yunnan is also investing heavily in the construction of airports and highways in an effort to improve its infrastructure.

    With a population of 40 million, Yunnan borders Laos, Myanmar and Vietnam.

    Yunnan, together with neighboring Guangxi and Guizhou, aims to become a major transportation gateway between southwest China and ASEAN member countries.