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Residents loan money but government skips repayments

A COUNTY government that forcibly borrowed more than 13 million yuan (US$13.9 million) in loans from local residents has still not repaid them 14 years later.

In 1995 the government of Lanxi County, in Heilongjiang's Suihua City, collected 13.23 million yuan from 470,000 local residents, mostly farmers,to build a road. The county, listed as one of the province's 10 poorest counties, was short of funds, 64-year-old retired bank clerk Dong Zhanlin told today's China Youth Daily.

The county government confirmed the loan.

A 2005 report by the county's transport bureau said the county government had needed 26.72 million yuan to build the 22-kilometer Lanzhao Road, a section of Suizhao Road from Lanxi to Zhaodong, in 1995.

While the province government had shouldered 10 million yuan of the cost, the county government had to raise the rest. The local government then borrowed 13.23 million yuan from the residents, including 9.36 million yuan from farmers.

For the past seven years Dong has been trying to get the loans repaid and has lodged complaints with county, city and province-level governments and filed lawsuits.

But the governments have not resolved the issue and the local court will not hear the case, Dong said.

Lanxi's vice governor Qi Weidong, who is in charge of the county's transport, declined to comment to China Youth Daily on the issue, but said the government would solve the problem this year.

Lanxi's transport bureau director Wang Fucheng said the same thing. But he added the government might not pay any interest to the farmers as rates had never been mentioned.

When it collected the loans in April 1995, the Lanxi government promised to return the borrowed money in three years after the road was completed in 1996. It said it would use the profit from road tolls to repay the loans, Dong said.

But 14 years have passed and not a cent has been repaid.

Citing figures issued by the county government in 2004, Dong said the income from road tolls was not yet enough to cover the construction investment. The government still owed more than 1 million yuan to the construction firm.

Dong calculated it would take another 20 years to pay the cost of construction and another 50 years to repay the loans to residents.

And repayment seemed even less probable after the province canceled toll fees at local roads last month, Dong said.

Residents told China Youth Daily they had been forced to lend the loans to the government. The government had set loan quotas for all of its residents: 400 yuan for senior government officials, 200 yuan for ordinary workers and rural teachers, 130 yuan for rural families and 100 yuan for private business operators. Landlords had to pay 100 yuan for their tenants.

Dong said he had 200 yuan deducted from his salary and had to pay another 130 yuan for his rural family.

Many rural families were forced to borrow money at high interest rates to pay these loans, Dong said.

About 80 percent of the 4,500 rural families in the Changjiang area, had to borrow money at a monthly rate of 4 percent, Dong said.

Private businesses also complained about the loans.

A businessman surnamed Zhang told the newspaper that he had first refused to lend the money when officials came to collect.

He finally had to pay 200 yuan because the officials told him that he would have trouble with the annual government inspection if he did not pay.


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