Chinese cities unveil investment plans to help national economy
Source: Bloomberg News |
August 22, 2012, Wednesday
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Print Edition
Print Edition
TIANJIN has unveiled a multi-year target of 1.5 trillion yuan (US$236 billion) for industrial investment, joining a similar plan by Chongqing amid local efforts to help reverse China's growth slowdown.
Tianjin, in north China, plans the investment over four years in 10 industries, including petrochemicals and aerospace, a report in the Tianjin Daily said yesterday. Chongqing, in the southwest, will boost industrial investment to 1.5 trillion yuan in the years through 2015, Xinhua news agency said on Monday.
The spending builds on reports last month that central China's Changsha will invest 829 billion yuan in projects, including an airport and subway lines, while east China's Nanjing and Ningbo will introduce measures to boost consumption. The regional plans will help the national economy rebound in the second half after expansion slowed to a three-year low last quarter, Nomura Holdings Inc said.
"There are further signs that policy stimulus continues to be focused on infrastructure spending and consumption measures," Dariusz Kowalczyk, economist at Credit Agricole CIB in Hong Kong, said in a note yesterday after Chongqing's announcement. He said separately that while there is a risk of overcapacity, the local industrial-investment plans are likely to be "well coordinated" by national economic planners.
The Shanghai Securities News yesterday reported that China may give 5,000 yuan in subsidies for each purchase of a diesel car under a government plan to reduce carbon dioxide emissions.
The reports didn't say how much of an increase the spending would represent over previous plans. Tianjin had fixed-asset investment of 751 billion yuan in 2011, while Chongqing's totaled 763 billion yuan. Investment nationwide rose 20.4 percent in the January-July period from a year earlier, while industrial production grew 9.2 percent in July, below the median economist estimate of 9.7 percent.
Bank lending and bond sales are likely to help fund the spending, Kowalczyk said. The Tianjin Daily said the city will give preferential treatment to the industries through land and taxes.
Huang Qifan, Chongqing's mayor, was quoted by the People's Daily website yesterday as saying the city will develop a "comprehensive, multi-channel, low-cost" financing system to support the industrial-investment plans.
Tianjin, in north China, plans the investment over four years in 10 industries, including petrochemicals and aerospace, a report in the Tianjin Daily said yesterday. Chongqing, in the southwest, will boost industrial investment to 1.5 trillion yuan in the years through 2015, Xinhua news agency said on Monday.
The spending builds on reports last month that central China's Changsha will invest 829 billion yuan in projects, including an airport and subway lines, while east China's Nanjing and Ningbo will introduce measures to boost consumption. The regional plans will help the national economy rebound in the second half after expansion slowed to a three-year low last quarter, Nomura Holdings Inc said.
"There are further signs that policy stimulus continues to be focused on infrastructure spending and consumption measures," Dariusz Kowalczyk, economist at Credit Agricole CIB in Hong Kong, said in a note yesterday after Chongqing's announcement. He said separately that while there is a risk of overcapacity, the local industrial-investment plans are likely to be "well coordinated" by national economic planners.
The Shanghai Securities News yesterday reported that China may give 5,000 yuan in subsidies for each purchase of a diesel car under a government plan to reduce carbon dioxide emissions.
The reports didn't say how much of an increase the spending would represent over previous plans. Tianjin had fixed-asset investment of 751 billion yuan in 2011, while Chongqing's totaled 763 billion yuan. Investment nationwide rose 20.4 percent in the January-July period from a year earlier, while industrial production grew 9.2 percent in July, below the median economist estimate of 9.7 percent.
Bank lending and bond sales are likely to help fund the spending, Kowalczyk said. The Tianjin Daily said the city will give preferential treatment to the industries through land and taxes.
Huang Qifan, Chongqing's mayor, was quoted by the People's Daily website yesterday as saying the city will develop a "comprehensive, multi-channel, low-cost" financing system to support the industrial-investment plans.
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