The 3.6 billion yuan 重庆江北 airport 3rd phase expansion project has started work. It is currently China's first approved airport construction project under the plan to increase domestic demand to stimulate economy growth. Other than adding infrastructure buildup for airport, railway, highway, harbor and others, 重庆 plans 300 billion yuan to be used to improve the people's living conditions in building of 1 million square meters of affordable renting apartments and the completion of the reform of dangerous old housing and squatter settlements of about 10,160,000 square meters. Other than that, 120 billion yuan will be used for the rural irrigation projects, special industries development, improvement of the rural ecological environment, etc.
重庆 city NDRC director 杨育庆 says that on top of the basis of completion of fixed asset investments of 400 billion yuan this year, the plan is to strive for fixed asset investments amount of over 1 trillion yuan for next year and the year after and to fight for 1.5 trillion yuan within 3 years.
From data released from various locations, the highest investment amount was 云南, planning to invest about 3 trillion yuan in 5 years. 广东 investment will also reach 2.3 trillion yuan. From the released data, China's various provinces announced fixed assets investment amount has surpassed 10 trillion yuan, greatly surpassing the state department's target of 4 trillion yuan plan to stimulate local and social investment.
State council development research center macroeconomic research institute analyst 张立群 points out that such investments targets are quite specific which includes roads, railways, harbor, low-income housing, farmland irrigation infrastructure, etc. He thinks that such investments will have more effect on the ability to stimulate the economy growth in mid to long term because such industries buildup will provide a lot of investment products orders. To the related industries and the rural workers, there will be lots of employment opportunities provided.
But at the same time, experts have also warned that although stimulating domestic demand is a good thing, but there is the need to prevent the negative effects of over investing. 张立群 says that when the economy starts to recover in 2009 say second quarter, there is a need to be cautious about the situation where there are overheated new investments.
China Various Provinces Announced Investments
云南 - To invest about 3 trillion yuan in 5 years
广东 - 2.3 trillion yuan
上海 - 500 billion yuan
吉林 - 400 billion yuan
海南 - 207 billion yuan
安徽 - 389 billion yuan
浙江 - 350 billion yuan
河北 - 588.9 billion yuan
河南 - 1.2 trillion yuan
辽宁 - 1.3 trillion yuan
江苏 - Before end of 2009 to complete 300 billion yuan and to invest 650 billion yuan in 2010
Latest Updates
24 November 2008
The Straits Times
Nov 24, 2008 |
$2.1 trillion for provinces
BEIJING - CHINA'S provinces have drawn up long wish lists for roads and other projects since Beijing unveiled an economic stimulus plan, state TV reported, as local leaders take advantage of a new willingness to spend amid the global crisis.
Spending proposals announced over the past week by provinces total 10 trillion yuan (S$2.1 trillion), China Central Television said on Sunday. But the report gave few details and no indication how much of that might be approved by the central government.
The 21st Century Business Herald, a major Chinese business newspaper, said few investments announced by provinces were new. It said most are either under construction, have been under discussion for some time or were planned but not begun due to lack of money.
The newspaper said much of the proposed provincial spending is still awaiting national approval.
Chinese stocks were down on Monday, mostly in dismay that authorities did not announce an interest rate cut over the weekend as some investors had speculated. The Shanghai Composite index fell 1.6 per cent to 1,937.7 in morning trading.
Beijing has not officially commented on the report by CCTV, the main government-run broadcaster.
Local leaders have been under orders to curb construction spending over the past three years as Beijing tried to cool an investment boom that it worried might lead to a debt crisis or higher inflation. But with the announcement of the stimulus, they appeared to be reviving blocked or canceled projects in hopes of winning approval or financing.
'Within a week, the governments of various provinces announced massive-scale investment blueprints,' the CCTV report said. 'Based on a rough calculation, the current total investment by all the provinces and cities has already exceeded 10 trillion yuan.'
Beijing's announcement of a 4 trillion yuan stimulus on Nov 9 electrified Chinese investors and briefly boosted global markets. But as details were released, it became clear the plan included less new spending than initially thought.
The biggest provincial proposal came from Yunnan in the southwest, which wants to invest 3 trillion yuan over the next five years, CCTV said. The booming southeastern province of Guangdong proposed 2.3 trillion yuan in investments.
Mr Zhang Liqun, a researcher at a think tank attached to the Cabinet's planning agency, said the provinces' planned spending is mainly on projects related to railways, roads, ports and low-income housing, according to CCTV.
'It will have quite an obvious effect on the country's medium- and long-term economic development,' Mr Zhang said. But Mr Zhang also cautioned that the country will have to watch out for economic overheating if growth recovers amid the spending boom.
China's economic growth slowed in the latest quarter to 9 per cent, down from last year's 11.9 per cent. That would be the highest of any major economy, but leaders are alarmed at the rapid drop in growth and worry that rising layoffs could trigger unrest.
Analysts have suggested Beijing threw as many projects as it could into its national plan, including many already under way, to produce a dramatic price tag that would encourage consumers and companies to spend.
The US$586 billion (S$896 billion) stimulus package is aimed at boosting domestic consumer spending to reduce China's reliance on the cooling global export market. It calls for higher spending on highways and other construction, social programs and tax cuts.
Analysts say the package includes projects already covered by its five-year plan that runs through 2010. But Mr Frank F.X. Gong, chief regional economist for JP Morgan & Co, says it still calls for some 1.6 trillion yuan in spending on top of previously announced projects.
The central government says it will provide 1.8 trillion yuan of the stimulus spending, while local governments and state companies will supply the rest.
On Sunday, Premier Wen Jiabao, China's top economic official, called for companies to boost confidence and adapt to market changes to weather the global crisis, the official Xinhua News Agency reported.
'Enterprises must have confidence for them to stabilise market expectations. Confidence is what they need to tide over the difficult times,' Mr Wen was quoted as saying during a tour of businesses in Shanghai and the eastern province of Zhejiang.
Also on Sunday, central bank Governor Zhou Xiaochuan called for stepped-up efforts to carry out the government's pledge of more financial support to small and medium-size companies and to improve environmental protection and rural development, Xinhua said. -- AP
No comments:
Post a Comment