Expanding Effective Investment to Stimulate Growth Momentum (Mid year Economic Observation) Investment | Infrastructure | Economy
Capable of processing billions of images within 24 hours - In the first half of this year, with the support of a special loan of 230 million yuan from the National Development Bank, the Future Artificial Intelligence Computing Center in Yanta District, Xi'an City, Shaanxi Province, accelerated its construction and operation;
In the first half of the year, 41 newly listed companies on the Science and Technology Innovation Board had a total IPO financing amount of 87.7 billion yuan - R&D investment from listed companies in industries such as new generation information technology, biopharmaceuticals, and high-end equipment continued to grow, and innovation capital accelerated its formation;
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The Political Bureau meeting of the Central Committee of the Communist Party of China held on July 24th emphasized the need to better leverage the role of government investment and accelerate the issuance and use of local government special bonds. We need to formulate and introduce policies and measures to promote private investment.
All regions and departments have thoroughly implemented the decisions and arrangements of the Central Committee of the Communist Party of China, fully played the key role of investment, promoted major infrastructure construction, supported enterprises to increase investment in innovation, continued to maintain growth in fixed assets investment, further unleashed the potential of domestic demand, and promoted the sustained recovery of the economy. In the first half of this year, the national fixed assets investment was 24311.3 billion yuan, up 3.8% year on year. Among them, infrastructure investment and manufacturing investment increased by 7.2% and 6% respectively. The investment structure continues to optimize, and investment in key areas continues to strengthen.
Strong foundation, steady progress in infrastructure construction investment
Infrastructure is an important support for economic and social development. Since the beginning of this year, major engineering projects have started construction actively, with increased funding support and overall stable growth in infrastructure construction investment. At the same time, under policy guidance, the layout, structure, function, and development model of infrastructure construction are gradually optimized, and the construction of a modern infrastructure system is accelerating, laying a solid foundation for stable investment.
——Traditional infrastructure is steadily being constructed.
On the early morning of July 4th, with the final set of turnouts installed, the Guangzhou Zhanjiang high-speed railway Jiangda connecting line successfully connected to the largest marshalling station in southern China, Jiangcun Station, located in Guangzhou.
The construction sites of the Guangzhou Zhanjiang high-speed railway are progressing smoothly, including bridge closure, tunnel completion, and station access. "We have accelerated the progress of funding review, and all 750 million yuan of infrastructure construction investment fund funds have been fully paid. At the same time, we have taken the lead in syndicated loan support, and a total of 910 million yuan of medium and long-term credit funds have been disbursed," said the relevant person in charge of the Guangdong Branch of the China Development Bank.
From the densification and reinforcement of the "eight vertical and eight horizontal" high-speed rail network, the widening and dredging of shipping waterways leading directly to the ocean, to the extension of water transmission pipelines through mountains and mountains to rural areas... The finance department plays a positive role in local government special bonds and central infrastructure investment, and policy oriented development finance leverages its advantages in medium and long-term funding support to help strengthen and fill the gaps in traditional infrastructure construction such as energy, transportation, and water conservancy, continuously opening up new investment opportunities.
In the first half of the year, China started 17600 new water conservancy infrastructure construction projects, with the largest number of new major water conservancy projects in history during the same period; The investment in railway transportation and water management industries increased by 20.5% and 9.6% respectively, providing strong support for expanding domestic demand, stabilizing growth, and ensuring people's livelihoods.
——Accelerated layout of new infrastructure.
As one of the key projects for new infrastructure construction in Shenzhen, Guangdong Province, the Shenzhen Yifeng Technology Bright 5G Big Data Center project is a large-scale data center based on the latest technology. After completion, this project can accommodate nearly 12000 servers and provide efficient and secure cloud computing services. In the first quarter of this year, Shanghai Pudong Development Bank Shenzhen Branch actively connected with the financing needs of enterprises, adopted innovative financing plans, shortened the approval process, provided a special loan of 1.355 billion yuan for the project, and also implemented preferential interest rate policies to reduce the financing costs of enterprises.
New infrastructure is an important component of modern infrastructure systems. Each region and department will moderately advance the deployment of new infrastructure projects such as 5G, charging facilities, and big data centers, adding new opportunities to expand effective investment. Since the beginning of this year, a batch of central budget investments have been centrally allocated, and various regions have increased their investment in new infrastructure through special bonds. Policy oriented development finance has accelerated its use, and commercial banks have actively expanded their new infrastructure credit business, resulting in continuous investment in major new infrastructure projects.
The first "integrated wind, solar, thermal, and energy storage" ultra-high voltage power transmission project in China has started construction, and the first "5G+" smart power plant phase I project in Hainan has been fully completed and put into operation. Anhui is actively building a "network" of charging and swapping infrastructure throughout the province... With the support of various policies, new infrastructure in various regions is accelerating its layout, forming new momentum to stimulate innovation and expand demand. In the first half of the year, investment in new infrastructure construction increased by 16.2% year on year, including 13.1% for new information infrastructure construction such as 5G and data center, and 34.1% for new integrated infrastructure construction such as industrial Internet and smart transportation.
——Efforts will be made to implement basic infrastructure for people's livelihoods.
The construction and expansion of facilities such as inclusive childcare, inclusive elderly care, and national fitness are accelerating to meet the growing needs of the people for a better life; In the first half of the year, there were 42600 newly started renovations of old urban communities in China, and more housing was renovated from its old appearance. Investment in infrastructure and public facility management in the field of people's livelihood continued to grow. In the first half of the year, various regions issued 2172.1 billion yuan of special bonds for project construction, supporting the implementation of a large number of projects that benefit people's livelihoods, fill gaps, and strengthen weak areas.
"The fiscal expansion guided by improving people's livelihood infrastructure not only stabilizes short-term growth, but also promotes the agglomeration of human capital and innovation power, which is conducive to long-term economic growth," said Bai Yanfeng, a professor at the School of Finance and Taxation at Central University of Finance and Economics.
Promoting innovation and continuously expanding investment in high-tech industries
Each region and department actively plays a crucial role in optimizing the supply structure through investment, with promoting innovation as the key. We will continue to increase innovation investment represented by high-tech industries and technological services, injecting a continuous stream of power into building a modern industrial system. In the first half of the year, investment in high-tech industries increased by 12.5% year-on-year, significantly faster than the overall investment growth.
——The investment in the transformation and upgrading of traditional manufacturing industry is constantly increasing.
Entering the production workshop of Sany Heavy Industry Co., Ltd.'s Changsha No. 18 factory, various welding, gripping, assembly, and handling robots are showcasing their abilities around the intelligent production line. This factory has been successfully selected as the "Lighthouse Factory" project, a global model of intelligent manufacturing and digital transformation.
"In the first half of this year, with the support of various precise policies of the People's Bank of China, the company has raised nearly 10 billion yuan in the interbank bond market," said Liu Hua, Senior Vice President and CFO of Sany Heavy Industry. Among them, the company has invested nearly 400 million yuan in the digital transformation and upgrading of factories in various regions, promoting the construction of more "lighthouse factories".
Traditional industries have a large base and high proportion in the manufacturing industry, and there is a high demand for funds for digital and intelligent transformation. The People's Bank of China continues to play a precise guiding role in structural monetary policy, guiding and supporting commercial banks to support the transformation and upgrading of traditional manufacturing industries by increasing their medium - and long-term lending in the manufacturing industry, as well as using structural monetary policy tools such as carbon reduction support tools and special re loans for equipment updates and renovations.
Guangdong has formulated specific transformation and upgrading guidelines for the textile and clothing industry and furniture industry; Shandong focuses on six traditional advantageous industries, including metallurgy, chemical industry, and machinery, and strives for an average annual growth rate of over 6% in industrial technological transformation investment. Various regions actively promote the transformation and upgrading of traditional industries and do not simply exit as "low-end industries".
——Investment in emerging fields is further expanding.
Entering the body workshop of Anhui NIO Advanced Manufacturing Base, various intelligent machinery and equipment are operating at full capacity, and the production of new energy vehicles is in an orderly manner. "The financing of over 10 billion yuan has provided strong support for the development of enterprises in the field of intelligent electric vehicles." Feng Wei, Chief Financial Officer of NIO, introduced that in the first half of the year, multiple new models of the enterprise were launched.
"More than 6000 strategic emerging industry enterprises in the province have contributed more than 50% of the listed enterprises and more than 80% of the national level specialized and innovative 'little giant' enterprises," said the relevant person in charge of the Anhui Provincial Development and Reform Commission.
Since the beginning of this year, strategic emerging industries have become one of the main directions for expanding effective investment. The C919 large passenger aircraft successfully completed its first commercial flight, and the world's first ultra large capacity 16 MW offshore wind turbine was successfully lifted... In the first half of the year, investment in emerging fields continued to expand, with investments in electronic and communication equipment manufacturing and e-commerce services increasing by 14.2% and 22.2% respectively year-on-year, and investments in clean electricity increasing by 40.5% year-on-year.
——Policy empowers investment in technological innovation.
The People's Bank of China fully leverages the role of technology innovation refinancing as a driving force, incentivizing commercial banks to increase credit investment in specific fields, and improving the ability of enterprises to transform and industrialize scientific and technological achievements; The State Council has announced the Regulations on the Supervision and Administration of Private Investment Funds, encouraging venture capital funds to invest in technology early and small. A series of reform measures and preferential policies are accelerating the deep integration of innovation chain, industry chain, capital chain, talent chain, and cultivating a fertile ground for more high-tech industry "golden seeds". In the first half of the year, investment in professional technical services and technology achievement transformation services increased by 51.6% and 46.3% year-on-year, respectively.
"At present, policies and tools to stimulate technological innovation are constantly enriching, and technological innovation activities have long-term characteristics. It is necessary to continue to maintain the continuity, stability, and pertinence of macro policies, and encourage enterprises to increase innovation investment in a long-term and stable manner." said Tian Xuan, Vice Dean of the School of Finance at Wudaokou, Tsinghua University.
Aggregation power, further stimulating the vitality of private investment
Private investment is the main force of fixed assets investment in the whole society. Accelerate policy implementation in various regions and departments, further stimulate the vitality of private investment, increase reform efforts to improve the market environment, and fully promote the gradual stabilization of private investment.
——Government investment drives the scale of private investment.
"From purchasing production equipment to increasing investment in technological innovation and research and development, a large amount of financial support is needed," said Zhu Caiwei, the financial director of Hefei Jinghe Integrated Circuit Co., Ltd. Hefei Construction Investment Holding Co., Ltd. and Hefei Chip Screen Industry Investment Fund have cumulatively invested 5.314 billion yuan in the company, driving social capital to invest 3.095 billion yuan. In May, the company successfully went public on the Science and Technology Innovation Board.
Government funds play a leverage role in strengthening cooperation and docking with social capital, policy oriented development financial tools leverage private capital to participate in major projects, and real estate investment trust funds in the infrastructure sector revitalize private investment projects... Government investment and policy incentives further play a guiding role, effectively driving and stimulating private investment. As of the first half of this year, more than 50000 projects have been promoted in various regions since 2022, of which more than 9000 have attracted private capital participation, involving a private investment amount of 2.9 trillion yuan.
——Credit support policies enhance the willingness of private investment.
"No collateral is required, online application and fully automatic approval are required. In less than 1 hour, the specialized, refined, and new enterprise loan of 10 million yuan from Everbright Bank will be received." Zhang Weifeng, Chairman of Zhejiang Gaotai Haoneng Technology Co., Ltd., said that with this loan, the company's funds for research and development, procurement of raw materials have been secured, and the company's annual production of 1 million sets of battery management system technology transformation and improvement project can also be smoothly put into operation this year.
The vast majority of small and medium-sized enterprises are private enterprises. Since the beginning of this year, the People's Bank of China has continued to make full use of its support tools for inclusive small and micro loans, providing a total of 39.8 billion yuan to local legal person financial institutions and supporting an increase of 2.2 trillion yuan in inclusive small and micro loans. These credit funds support enterprises to overcome difficulties, resume operations, and further promote the expansion of production capacity and further development.
Further synergy between financing services and policy support. On July 7th, the National Development and Reform Commission established a pilot cooperation mechanism for investment and loan linkage with seven banks. Through the interconnection and sharing of investment online platforms and bank credit systems, it not only provides support for banks to increase financing support for private investment projects and accelerate loan review progress, but also helps investment regulatory authorities to timely grasp project financing and construction implementation, enhancing the efficiency of private investment.
——Institutional reform boosts confidence in private investment.
Continuously breaking down market access barriers, fully implementing fair competition policies and systems, improving financing support policies and systems, and protecting the property rights and interests of private enterprises and entrepreneurs in accordance with the law... The recently released "Opinions of the Central Committee of the Communist Party of China and the State Council on Promoting the Development and Growth of the Private Economy" focuses on six key tasks to promote the development and growth of the private economy, further clearing investment barriers for private enterprises, and optimizing the environment for the development of the private economy;
By the end of 2023, small-scale taxpayers with monthly sales below 100000 yuan will be exempt from value-added tax, and efforts will be made to clear outstanding accounts of small and medium-sized enterprises. The National Development and Reform Commission and four other departments have issued a notice on key cost reduction work in 2023, deepening the reform of "streamlining administration, delegating power, and improving services", and allowing more private enterprises to embark on development with ease;
Simplify the management of private investment approval, innovate and optimize investment approval procedures... Beijing, Shanghai, Jiangsu and other places have successively introduced a package of policies to promote investment facilitation from various aspects.
"Further breaking down legal and regulatory barriers and implicit barriers that affect fair competition and common development of various types of ownership enterprises, protecting the property rights of private enterprises and the rights and interests of entrepreneurs in accordance with the law, creating an efficient, standardized, fair competition, and fully open national unified market, will undoubtedly provide a better development environment for private investment," said Wen Bin, Chief Economist of Minsheng Bank.
