China SCIO | December 26, 2024
Cover News:
Mr. Zheng just mentioned the need to expand effective investments. Could you elaborate on the follow-up policies and measures that will be implemented to ensure timely investments and concrete results? Thank you.
Zheng Shanjie:
I would like to invite my colleague Mr. Liu to answer this question.
Liu Sushe:
Thank you for your question. Since the start of this year, we have been focusing on key sectors and critical areas, leveraging government investment's guiding and driving role to fully stimulate social investment and expand effective investments. Let me share some data to give you an overview of this year's situation.
Almost all of the nearly 6 trillion yuan of government investment for this year has been allocated to specific projects, which are now progressing to yield tangible results. All of the 700 billion yuan of central government budgetary investment for this year has been assigned to specific projects, with 58% of them already in the works. Out of the 1 trillion yuan ultra-long special treasury bonds, a total of 700 billion yuan has been allocated for implementing national key strategies and building up security capacity in key areas (two major initiatives), with 50% of related projects having commenced. As for the 3.12 trillion yuan in special-purpose local government bonds for project construction this year, by the end of September, 2.83 trillion yuan, or 90%, had been issued, with 85% of the projects already started. The 1 trillion yuan in treasury bonds issued in the fourth quarter of last year for post-disaster recovery and reconstruction and improvement of disaster prevention, mitigation and relief capabilities saw all projects already begin as of the end of June this year, with 770 billion yuan invested so far. On the private investment front, we have promoted 1,635 major projects to private capital this year, of which 441 have successfully attracted private investment, amounting to a total investment of 344.8 billion yuan. Progress has also been made in involving private capital in major infrastructure projects, such as nuclear power and railways. Additionally, we have selected the first batch of 189 national key private investment projects and helped coordinate and address major issues like ensuring financial factors. We have also standardized the new mechanism for cooperation between government and social capital, focusing on user-fee models, completely adopting the franchise model and prioritizing participation of private enterprises. Demonstration projects with 141 billion yuan of investment have already been made public.
According to directives from a meeting of the Political Bureau of the CPC Central Committee and a State Council executive meeting, we will next collaborate with relevant departments to coordinate existing and incremental policies that aim to expand effective investment, ensuring stable investment growth. I will outline the policy implementation going forward in five aspects:
First, we will speed up the release of both the project list of 2025 for the two major initiatives and the investment plans under the central government budget. Providing support for the two major initiatives is a strategic decision of the CPC Central Committee with the aim to strengthen the nation and achieve national rejuvenation. The issuance of ultra-long special treasury bonds will continue in 2025, and we will optimize the allocation of these funds, ensuring strong support for the two major initiatives. Currently, the NDRC, in coordination with relevant departments and local governments, is preparing a batch of major programs for the two major initiatives in a top-down manner while accelerating “soft construction” like innovations in policy, planning and institutions. The continuous improvement of investment mechanisms and investment efficiency and the coordination of “hard investment” with “soft construction” are all contributing to the goals of the two major initiatives. Investment plans under the central government budget will continue to support foundational, public welfare and long-term projects, accelerating efforts to address shortcomings during China's modernization. Issuing project lists and investment plans in advance helps to speed up preliminary work and initiate project implementation. To this end, as Mr. Zheng just mentioned, by the end of this month, we plan to issue a 100-billion-yuan project list for the two major initiatives and a 100-billion-yuan central government budget investment plan, in accordance with procedures. The projects involved have been carefully selected by the NDRC and relevant government departments. These projects meet investment criteria, have already completed preliminary preparations and are with right conditions, allowing for concrete results within the year.
Second, we will increase efforts to advance the 102 major projects outlined in the 14th Five-Year Plan. Of the 5,100 specific projects involved, 92% have already started construction or been completed. Next, we will further enhance coordination to ensure that all those involved fully shoulder their share of responsibilities. By strengthening financial support and factor resource supply, we will accelerate the start of the remaining 409 specific projects to ensure the successful completion of all 102 major projects outlined in the 14th Five-Year Plan by the end of next year.
Third, we will ensure the efficient use of local government special bonds. On the one hand, we will urge relevant local governments to issue the remaining 290 billion yuan in special bonds allocated for this year by the end of October. At the same time, we will accelerate both the construction of projects funded by the issued bonds and the use of funds, achieving more tangible progress. On the other hand, to address prominent issues in the issuance, use, and management of local government special bonds, the NDRC and Ministry of Finance are exploring ways to expand the scope of funds raised from bond sales. This includes allowing a larger share of these funds to be used as capital across more sectors and on a broader scale. We are also carrying out studies, launching trials to give local governments more autonomy in project review, and implementing "green lanes" for ongoing projects. New measures to improve the management of local government special bonds will be introduced as soon as possible.
Fourth, we will strengthen the management of government investment projects at all stages. We'll enhance project coordination through online monitoring, on-site supervision and inspections, guiding local authorities and departments in implementing various government investment projects and accelerating their progress. Simultaneously, we'll intensify efforts to reform the investment review and approval system and swiftly develop policies to improve government investment decision-making mechanisms and raise investment efficiency.
Fifth, we will support and encourage the healthy development of private investment. We'll accelerate improvements to long-term mechanisms for private enterprises' participation in major national projects, focusing on promoting high-quality projects to encourage more private capital in major infrastructure projects like railways, energy and water conservation. We'll also expedite the selection of a new list of national key private investment projects. Additionally, we'll regulate and implement a new mechanism for government and private capital cooperation, support eligible private investment projects in issuing infrastructure REITs, and deepen trials allowing banks to participate in combined debt-equity investments.
Thank you.