What’s new: China’s top economic planning body intends to set up special funds to support investment in infrastructure and public sectors while attracting more private investors to take part.
The National Development and Reform Commission (NDRC) published draft guidelines on the establishment of special funds backed by the central government budget to support public welfare projects and encourage private investment in certain regions. The commission will seek public comments on the guidelines until March 18.
According to the guidelines, the NDRC will inject funds into qualified projects with an investment of no less than 100 million yuan ($14 million). State investment in each individual project will be no less than 20 million yuan and not exceed 60% of the total project investment.
Projects to be supported include those in transportation, energy, water conservancy, healthcare, education, elderly care, sports and tourism.
The context: The draft guidelines followed an NDRC notice issued in July pledging funding support from the central government to regions with vibrant private investment. The commission said at that time that it will provide support to 20 prefecture-level cities each year with projects that show potential and have attracted a high-proportion of private investment.
Beijing is ramping up efforts to revitalize private investment to help bolster the world’s second largest economy, which has been suffering from a prolonged property slump, growing headwinds in exports and lukewarm domestic consumption. The struggles of the private sector, the biggest source of jobs and a main contributor to the nation’s fixed-asset investment, have taken a toll on the economy.
Contact reporter Han Wei (weihan@caixin.com)
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