The Jiaozhou Bay wetlands, the most important marine ecosystem in the Qingdao region, provide a breeding ground for many types of fish and shellfish, and is a way station for migratory birds.

However, as the coastal population and economy has grown rapidly, the wetland area has shrunk by an estimated 30 percent since the 1950s, an ADB statement said.

The loan would be used to build or upgrade wastewater, sewerage, and flood management facilities, with the city of Jiaozhou providing counterpart funds equivalent to 60.8 million dollars.

Loan terms were not disclosed. ADB will also provide a 750,000-dollar technical assistance grant.

Waste dumping into rivers that empty into the bay and poor drainage facilities have caused chronic flooding around Jiaozhou, and the contaminated water pose a serious public health hazard, the ADB said.

"The wetlands need to be protected as they play a key role in flood management and coastal protection which will be increasingly significant to coastal cities as sea levels continue to rise as a result of global warming," said ADB water resources engineer Zhang Qingfeng.

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