China calls for more private funds to boost economy
China's private investment is expected to contribute more to invigorate the country's economy, an official at the National Development and Reform Commission said today at a press conference in Beijing.
"The growth rate of China's private investment is now at low levels partly due to the transformation of China's economy," said Meng Wei, a spokeswoman at the commission.
"There are a lot of reasons for this, including the long-existing problems like difficulties for private investors to get funds, less flexible policies for them, as well as the new ones like not enough innovation among private companies," Meng said at the conference.
In the first half of this year, China’s private investment rose 7.2 percent year on year to 17 trillion yuan (US$2.5 trillion), 1.4 percentage points slower than the average investment growth albeit it was 4.4 percentage points higher than a year ago.
The pace was mainly pulled down by the manufacturing sector, in which the private investment rose only 5.6 percent year on year, according to the commission.
China needs to build a friendlier environment for private investors while helping enhance innovation among private enterprises, Meng said.
The government will streamline administrative processes to ensure help private investors, and also help establish a more transparent pricing system to help fund-raising, she said.
The commission on Wednesday said the government will encourage more public-private partnerships to boost the use of private funds, which will help fund the construction of domestic roads and bridges and projects along the Belt and Road regions.
The commission will team up with the China Securities Regulatory Commission to make better use of the financial market to cater for the demand of private companies and will find out difficulties they face in real life with on-spot investigations and offer solutions.
Patrick Xu, an analyst at Nomura, said private fund, which is more flexbile, is an important complement to state investment, whose main function is to nurture emerging industries and upgrade its economy.
By the end of July, China’s private funds accounted for 60.7 percent of the nation’s fixed-asset investment.