China infrastructure investment to recover in Q2: analysts
China's investment in infrastructure projects will increase in the second quarter of this year as government incentives to boost such spending gradually get implemented, analysts said.
The country will soon unveil guidelines to foster the development of "new infrastructure" projects, according to Wu Hao, an official with the National Development and Reform Commission, the country's top economic planner.
The new infrastructures include information infrastructures such as 5G networks and data centers, as well as facilities that support the upgrade of traditional infrastructures, scientific research and product development, according to Wu.
A number of local governments have already unveiled guidelines to boost spending in new infrastructures. Planned investments in the country's 31 provincial-level regions totaled 6.7 trillion yuan (US$947 billion) this year, with 23 percent involving in new infrastructures, data compiled by Huatai Securities showed.
In addition to new infrastructure spending, investments in traditional infrastructures such as roads and railways also gathered pace, with excavator sales jumping last month.
Earlier data showed China's fixed-asset investment, including spending in infrastructure, property, machinery and other physical assets, declined 16.1 percent year on year in the first quarter of 2020 as the novel coronavirus outbreak disrupted economic activities.
As workers get back to construction sites and government bond issuance accelerates, infrastructure investments will return to growth by the end of the second quarter, said Li Chao, an analyst with Zheshang Securities, predicting that infrastructure investments will grow by 10 to 15 percent this year.