21st Century Business Herald:

How do you view the investment situation in October? You mentioned earlier that the cumulative growth rate of infrastructure investment rebounded for the first time in October. Can this recovery be sustained in the future? In addition, what impacts have the large-scale equipment upgrades and consumer goods trade-in program, as well as the policies to implement major national strategies and build up security capacity in key areas, had on investment? Thank you.

Fu Linghui:

Thank you for your questions. Investment is also an important part of the economy. In the first 10 months, although investment in the real estate was declining, China's overall investment scale continued to expand due to the large-scale equipment upgrade program, the innovation-driven development, and industrial upgrading and development. Investment in manufacturing and large projects grew rapidly; and investment in innovation continued to increase. All these supported the stable growth of investment and created favorable conditions for the country's high-quality development. The first 10 months can be categorized as follows:

First, investment expansion continued to stabilize. Fixed-asset investment (excluding rural households) rose 3.4% year on year in the first 10 months. The growth rate maintained at 3.4% for three consecutive months, showing a clear stable trend. We can see that investment has generally registered a downward trend so far since the start of this year, but it has been basically stable for the past three months. Large project investment played an important role in supporting investment expansion. In the first 10 months, the completed investment in projects with a planned total investment of more than 100 million yuan increased by 7.1% year on year, driving the growth of total investment by 3.8 percentage points and promoting stable investment growth.

Second, the policy effect of driving investment was reinforced. The policy effect of the large-scale equipment upgrade program has continued to manifest. In the first 10 months, investment in purchasing equipment, tools and instruments jumped 16.1% year on year, significantly faster than the overall investment growth. Such investment accounted for 14.8% of total investment and contributed more than 60% of overall investment growth. The steady progress in implementing major national strategies and building up security capacity in key areas drove the rebound of infrastructure investment. During the January-October period, investment in infrastructure construction rose 4.3% year on year, 0.2 percentage point faster than September, and marking the first rebound since March. As seen from the current situation, with the release of various policies and the recent progress in local debt relief, the infrastructure capacity of local governments will continue to improve, providing favorable conditions and a basis for the stable growth of infrastructure investment.

Third, manufacturing investment increased rapidly. Driven by industrial upgrading and development, investments in equipment manufacturing and consumer goods manufacturing registered a positive growth momentum, which supported the development of manufacturing investment. In the first 10 months, manufacturing investment increased by 9.3% year on year, 0.1 percentage point faster than the January-September period. In particular, investments in equipment manufacturing and consumer goods manufacturing grew 9.1% and 15%, respectively.

Fourth, investment in high-tech industries remained active. All localities have actively fostered and strengthened new quality productive forces, investing more in technological innovations and striving to stay ahead of the curve in industrial development, driving the growth of investment in high-tech industries. In the first 10 months, investment in high-tech industries increased by 9.3% year on year, significantly faster than the overall investment growth. Specifically, investment in aircraft, spacecraft and equipment manufacturing increased by 34.5%; investment in professional technical services increased by 32%; and investment in research, development and design services increased by 11%.

Overall, China's investment maintained stable growth recently, with the investment structure continuing to improve. Next, as the combined effects of existing policies and a raft of incremental policies become apparent, investment funding guarantees and project support will gradually improve, and the growth of investment is expected to continue.

Thank you.