China’s top economic planner released a set of new policy guidelines on Monday to support private investment, as part of a drive to rekindle entrepreneurial spirit amid faltering growth.
Beijing will look to revitalize private investment and encourage private capital to participate in major national projects, the National Development and Reform Commission said in an official notice on its website.
Preferred sectors for private companies to contribute include transportation, water conservancy, clean energy, new-type infrastructure, advanced manufacturing and agriculture, the NDRC said, adding that local governments will formulate lists of major projects for private capital to choose from.
Beijing pledged more financing support but warned that private companies shouldn’t blindly expand investment and add to their financial risks.
Monday’s announcement came after China’s top leadership last week unveiled a list of more than 30 guidelines vowing to kickstart growth in the country’s vast private sector, reiterating its promise to level the playing field between privately run and state-owned companies, as the world’s second-largest economy loses momentum gained during the initial post-pandemic recovery.
Private-sector investment in China dropped by 0.2% in the first half of 2023 from a year earlier, the second contraction since official data collection began in 2005. The only other contraction came in the first half of 2020, when the economy was wracked by the pandemic. Investment by state-controlled firms expanded 8.1% in the first half of this year.
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