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FINANCIAL NEWS
China Railway sees $623m loss from Makkah project
26 Oct 2010
(MENAFN) China Railway Construction Corp., the builder of more than half the nation�s railroads, said in a statement to the local stock market that it predicts a $623 million loss from a rail project in Makkah, Reuters reported.
The loss, equal to about 63 percent of the builder�s annual profit last year, was caused partly by changes in the project requirements, delays in land expropriations and the need for large amounts of manpower and resources to ensure on-time completion.
China Railway signed a deal with Saudi Arabia�s Ministry of Municipality and Rural Affairs in February, 2009 to build and operate the light railway, according to the statement. Mecca is the holiest site in Islam, with the annual Hajj pilgrimage drawing at least 2 million Muslims to the city.
The railway is due to begin limited operations next month and to reach full capacity in May, according to the statement. China Railway is due to operate and maintain the line for the first three years of service.
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