Private funds eyed for investment
Print Edition
CHINA’S top economic planner has invited social capital to invest in a list of 80 projects, the latest step in bringing private funds to infrastructure investment as well as a bid to inject vitality into the economy.
The list, published on the National Development and Reform Commission website yesterday, covers construction and operation of railways, roads, harbors, wind power stations and oil pipelines. Opening these sectors to social capital will speed up changes in investment and financing regimes and diversify investment sources. Most of the industries used to be dominated by state capital and were off-limits to private and foreign investors.
Social capital, particularly private investment, is welcomed and encouraged to participate in the construction and operation of such facilities through joint ventures, wholly-funded entities or franchise businesses, the NDRC said.
Xu Hongcai, director of the China Center for International Economic Exchange, believes non-public funds will benefit the urbanization and modernization process through optimizing the investment structure.
China has been moving toward clean energy like natural gas to cope with air pollution and improve people’s standards of living.
Liu Yijun, of China University of Petroleum, said that the oil industry used to have a high threshold for private investment, but opening pipeline construction will solve the capital shortage problem.
The government will open more infrastructure projects not listed in the statement, the NDRC said.
Xu said the 80 projects will be trials in luring social capital and used to draft regulations.
China is in transition, seeking a new growth model less reliant on exports and investment and more on domestic consumption. As a result, growth has slowed over the past two years to 7.4 percent in the first quarter of this year.
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