Accelerating the Progress of Major Projects with Multiple Funds Supporting Transportation Infrastructure China Securities Journal | Xinhua News Agency | Infrastructure
On June 27th, China Securities News published an article titled "Accelerating the Progress of Major Projects and Supporting Transportation Infrastructure with Multiple Funds.". The article states that in recent times, multiple key transportation projects across the country have intensified their construction, sparking a construction boom. According to data from Infrastructure Communications, in just half a month, relevant departments have approved 17 major highway transportation projects with an investment of over 1 billion yuan. Experts point out that since the beginning of this year, there has been a significant reserve of major infrastructure projects. With the increasing demand for stable growth, subsequent existing projects may accelerate their implementation, helping to expand effective investment and stabilize the overall economy.
The construction of transportation infrastructure is booming
Fearless of the scorching summer heat, the construction of major transportation infrastructure in many places is booming, constantly refreshing the progress bar.
Look at the railway. During the Dragon Boat Festival holiday, the construction sites of 10 high-speed railways under construction, including the Chuanqing Railway, Chengyi High Speed Railway, Chengda Wan High Speed Railway, Chengdu Chongqing Middle Line, Chongqing Kunming High Speed Railway, West Chongqing High Speed Railway, New Chongqing Wan High Speed Railway, Chongqing Hunan High Speed Railway Chongqian Section, Guinan High Speed Railway, and Panxing High Speed Railway, were bustling with activity. Builders abandoned the holiday, seized the opportunity, and fought hard on the construction front line to ensure the smooth progress of projects on schedule.
Look at the road. Recently, the construction of the Dongguashan Tunnel for the expansion project of the Anshun Panzhou section of the Shanghai Kunming Expressway, a key construction project in Guizhou Province undertaken by China Railway 16th Bureau, successfully entered the tunnel, marking the beginning of the comprehensive construction phase of the Anpan Expressway and creating favorable conditions for its early completion and opening to traffic.
Look at the airport. Recently, the T3 terminal project of the third phase expansion project of Guangzhou Baiyun International Airport has successively achieved important milestones such as the first main structure topping off in Zone A of the main building and the successful completion of the first steel structure grid frame lifting. On June 22nd, as the first cubic meter of concrete was slowly poured at the bottom of the foundation pit, the construction of the main body of Jinan Yaoqiang Airport Comprehensive Transportation Hub Project, Airport South Station, undertaken by China Railway Tenth Bureau, began, pressing the "acceleration button" for the construction of the station.
A batch of key projects have been approved, a batch of major projects are accelerating construction, and a batch of important projects are accelerating construction... Zhao Wei, Chief Economist of Guojin Securities, said that since the beginning of this year, there has been a large reserve of major infrastructure projects. Given the increasing demand for stable growth, subsequent stock projects may accelerate their implementation.
The driving force for expanding effective investment in transportation is sufficient
Recently, multiple regions have successively announced the progress of transportation investment in the first five months of this year, and continuously expanding effective transportation investment has become a common choice for local governments to expand effective transportation investment.
The Fujian Provincial Department of Transportation recently announced that in May, the province's investment in highway and waterway transportation reached 8.878 billion yuan, a year-on-year increase of 11.8%. From January to May, a cumulative investment of 45.876 billion yuan was completed, a year-on-year increase of 4.4%; The progress is 4.2 percentage points when exceeding the sequence. The Hubei Provincial Department of Transport recently released that the provincial fixed assets investment in roads and waterways from January to May was 69.95 billion yuan, up 38.9% year on year, hitting a new record. In terms of high-speed rail construction, Hubei Province is currently constructing and planning 10 high-speed railways in the next two years, with a total investment of 330 billion yuan. The number and investment scale of planned high-speed rail projects rank first in the country. According to the Chongqing Municipal Development and Reform Commission, infrastructure investment in Chongqing increased by 9.8% year-on-year from January to May, which is 2.3 percentage points higher than the national average. Among them, the year-on-year growth rate of transportation investment reached 10.9%.
Nationwide, the Ministry of Transport has previously announced that in the first four months of this year, it completed 1 trillion yuan of fixed assets investment in transportation, up 13.4% year on year. In addition, according to the data disclosed by China National Railway Group Co., Ltd., from January to May, the national railway completed fixed assets investment of 206.1 billion yuan, an increase of 7% over the same period last year.
Xie Shuqin, Consulting Manager of Sullivan Greater China, believes that since 2023, China's transportation industry has gradually recovered. Under the guidance and support of transportation infrastructure policies, the stable recovery of freight and passenger traffic has provided strong momentum for the growth of transportation infrastructure investment. Driven by such factors as large development space for highway construction, rising transportation demand, national strategic support, and overseas "big civil" infrastructure development, China's transportation fixed assets investment market has great potential, which will further help China's transportation infrastructure construction to flourish.
Expanding the sources of construction funds through multiple channels
The construction of transportation projects is booming, where does money come from?
Special bonds are an important lever for implementing proactive fiscal policies. On June 8th, Fujian Province successfully issued new government bonds worth 56.149 billion yuan. At this point, except for Xiamen's self issued and self repaid portion, the Ministry of Finance has issued all the new government debt quotas for Fujian Province this year, making Fujian Province the first province in the country to complete the annual task of issuing new government bonds.
According to Yu Bo, Chief Macro Analyst of Changjiang Securities, the second batch of local bond quotas has been gradually issued this year, and some provinces have made rapid progress in issuing them. As of June 16th, 18 provinces and cities including Beijing and Tianjin have disclosed the issuance of the second batch of local bond quotas in their budget adjustment plans. Among them, Beijing, Inner Mongolia, Fujian and others have clearly stated that they will accelerate the progress of bond issuance and use, and promote the formation of physical workload as soon as possible.
Sun Binbin, Chief Fixed Income Analyst at Tianfeng Securities, believes that the progress of new local bond issuances in June is likely to be faster than in May. On the basis of issuing the second batch of quotas and completing local budget adjustments, the issuance of local bonds in the third quarter is expected to increase again.
In addition, experts suggest that continuing to use policy oriented development oriented financial instruments can promote the expansion of effective investment. Wen Bin, Chief Economist of Minsheng Bank, stated that in addition to the expected acceleration of the issuance and use of special bonds, policy oriented development financial instruments may also increase their issuance to supplement project capital and support infrastructure investment.
Zhejiang Securities analyst Kuang Peiqin believes that infrastructure investment, as an important lever for stabilizing the economy, will be a key policy support area. Policy oriented development financial instruments supporting infrastructure and new infrastructure are expected to be introduced in the second half of the year, and the monetary environment is expected to remain relatively loose. There is still a possibility of reducing reserve requirements or interest rates.
