China will take solid steps like accelerating the implementation of major projects to stabilize and bolster investment, particularly in the manufacturing sector, the country’s top economic regulator said on Aug 17.
Experts said China’s intensified efforts to expand effective investment should help promote the orderly recovery of domestic demand and foster sustained steady economic growth in the second half of this year.
Meng Wei, a spokeswoman of the National Development and Reform Commission, told a news conference in Beijing that a big push will be made to strengthen weak areas and stabilize the investment scene, in order to better leverage the key role of effective investment in ensuring sustained growth.
The NDRC, she said, will do the following: actively implement major projects in the 14th Five-Year Plan period (2021-25); provide strong support to boost investment in manufacturing; accelerate the push for strengthening weak links in industry and supply chains; guide enterprises to increase investment on technological upgrades; ease the pressure of rising commodity prices on enterprises; and implement policies for cost cuts.
Zhou Maohua, an analyst with China Everbright Bank, said the proposed accelerated push for the implementation of major projects will help expand effective investment, create jobs and boost domestic demand.
Despite the rising uncertainties both at home and abroad, domestic investment will grow steadily in the second half on the back of the firm recovery in domestic demand, the government’s supportive policies, and the accelerated implementation of major projects across the nation, Zhou said.
The NDRC said it approved eight fixed-asset investment projects worth 58.2 billion yuan ($9 billion) in July, mainly in fields like transportation and energy.
During the January-July period, China’s fixed-asset investment jumped 10.3 percent year-on-year, and the average January-July growth rate in 2020 and 2021 stood at 4.3 percent, showed data from the National Bureau of Statistics.
This year, the country plans to earmark 610 billion yuan for investment in its budget. China will also issue special-purpose local government bonds totaling 3.65 trillion yuan this year — and priority will be given to funding for key projects under construction, according to the Government Work Report.
Meng said the NDRC will expedite the implementation of the central budget investment plan, and urge local authorities to be better prepared to efficiently implement the projects supported by the special bonds.
More efforts will be made to encourage the private sector’s participation in strengthening weak links like municipal projects, transportation, ecological environment and social projects, promote public-private partnerships, and support pilot programs of infrastructure real estate investment trusts, or infrastructure REITs, she said.
Tao Jin, deputy director of macroeconomic research at the Suning Institute of Finance, noted investment on “new infrastructure”, new urbanization initiatives and major projects is key to expanding effective investment.
He said a further boost to private-sector investment would be in order and urged steps to improve both the distribution of incomes and the assignment of project management rights and responsibilities.
Meng said the NDRC will take firm steps to realize the national goals of peaking carbon emissions by 2030 and achieving carbon neutrality by 2060.
In the next step, the NDRC will work with all the parties concerned to speed up the formulation and revision of energy-saving and low-carbon standards covering areas like energy efficiency and energy consumption limits.
More efforts will also be made to accelerate the push to build a”1+N” policy system for carbon peak and carbon neutrality, in which “1” is the guiding opinion and “N” the detailed scheme of various industries.
“We will strengthen the policy guidance to reduce enterprises’ carbon emissions … and promote green and low-carbon investment,” Meng said.