China 'pumped' over $ 100 billion for domestic projects
The Chinese government will invest about $ 103.8 billion in key projects, of which more than 40% is from bank loans.
The Ministry of Information Technology and Technology (MIIT) of China today announced it would invest about $ 103.8 billion in 105 projects across the country, of which about $ 43.9 billion came from bank loans. .
China Development Bank (CDB) has agreed to lend about 18.3 billion USD to develop 24 projects. The CDB said it granted a $ 36.6 billion credit line for these projects at the end of March, meaning the opening of the flow of government loans to finance important Chinese projects.
However, MIIT and CDB have not announced the list of eligible projects.
The rare direct coordination between MIIT and CDB in financing key projects is part of the new "dual circulation" strategy introduced by China. Under this plan, China will seek to create a technological breakthrough on its own and cut dependence on imported products amid a prolonged trade conflict with the United States.
Visitors view the CT scanner on display at an exhibition in Beijing, China, on September 6. Photo: Xinhua.
The Chinese government has issued a series of policies to promote development in the semiconductor manufacturing industry. Increased state intervention in the economy could become the topic of discussion during a meeting between Chinese President Xi Jinping and leaders of EU member states led by German Chancellor Angela Merkel. First, scheduled to take place on September 28.
One of the major obstacles to the signing of the EU-China investment treaty is that European countries require China to reduce the level of resistance for domestic industries to create a level playing field for foreign businesses.
The increasing participation of the state in industrial development raises concerns about waste and inefficiency. China has tried to develop its solar and electric vehicle industries through state planning, but has resulted in excess production. Some high-end chip manufacturing projects in China have failed despite considerable support from the local government.
According to a circular issued by MIIT in April, the low interest rate credit line from ODB for a project can be as high as $ 146.2 million. The projects eligible for the concessional credit must be in modern industries such as information technology, new materials, high-end equipment, energy-efficient or new energy-efficient vehicles, and medical and pharmaceutical equipment, technological innovation for traditional manufacturing projects, new infrastructure projects such as 5G telecommunications networks and big data centers.
These sectors resemble the list of key industries listed in the "Made in China 2025" program, the state plan to create national "champions" in the advanced technology sector. go ahead with the support of the Chinese government.
China had to shelve this plan after being strongly opposed by the US and Europe. Although China does not mention "Made in China" in public, the government still embraces its ambition to use state power to create "top business" in industries.
Smart waste sorting device at an exhibition in Beijing, China, September 6. Photo: Xinhua.
The MIIT and CDB joint program is part of China's effort to achieve "high-quality development in the manufacturing sector", after many of the country's businesses, including Huawei, were taken over by Washington. blacklisting and restricting access to US products or technology.
MIIT is dealing with the impact of US policy and the Covid-19 pandemic, and has to deal with long-term problems such as pushing the national production base. MIIT is drafting a new development plan for the 2021-2015 period according to the new self-reliance strategy of Chinese President Xi Jinping.
Xiao Aqing, who was recently appointed China's minister of industry, last week visited a large jet assembly plant, jet engine research facility and integrated chip manufacturers. in Shanghai. Minister Xiao Aqing called on companies to "achieve breakthroughs in key areas and core technologies".
MIIT is drafting a 5-year plan to promote the big data, software, information technology and telecommunications sectors "with clear development goals and tasks", Minister Tieu A Khanh said at the forum. in the framework of the China International Service Trade Fair last weekend.
According to the National Bureau of Statistics of China, investment in manufacturing in the period of January-July in this country decreased by 10.2% compared to the same period last year, total investment in the country decreased by 1.6%.
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