International Finance Corp, the private sector financing arm of the World Bank Group, plans to increase its investment in China’s agriculture, pollution control and urbanization projects over the next three years, according to one of its regional heads.
“The opportunities come from the country’s ongoing steps to make good use of foreign investment－to advance supply-side structural reform, upgrade the economy, as well as catching up with global technological developments,” said Vivek Pathak, IFC’s regional director for East Asia and the Pacific.
In the long-term, Pathak said China’s economic growth pace was still attractive for global investment as the country deployed more resources to build emerging and sustainable industries, create new jobs and tackle climate change.
China and India currently are the two biggest destinations for IFC’s investment in the Asia-Pacific region. IFC invested about $700 million in China’s infrastructure, manufacturing, agribusiness, micro finance and other service sectors in 2016.
IFC recently committed $200 million in financing to Shandong-based specialty fertilizer manufacturer, Kingenta Ecological Engineering Group Co.
With this funding, it aims to expand an innovative agricultural service platform and boost crop yields and income for millions of Chinese farmers. The project will also help curb usage of inefficient fertilizers and promote climate-smart agricultural practices in China.
Kingenta plans to set up hundreds of new crop production service centers across China in the next five years. The company said these centers will ensure farmers have access to its high-efficiency fertilizers and other high-quality inputs such as seeds, and training.
China currently is working with the World Bank to make its agriculture industry more competitive and mitigate the effects of food production on the environment. More efficient, specialty fertilizers reduce soil containment and waterway pollution.
The IFC regional leader said that encouraging the phasing-out of overused, inefficient fertilizers was part of the Chinese government’s strategy to reduce pollution and mitigate climate change.
“China has become part of international efforts to pursue common development and common prosperity for countries and regions related to the Belt and Road Initiative,” said Pathak.
“They need to gain new growth momentum, via what Chinese companies have and are proficient in.”
Since 2014, the IFC has invested a total $24.5 billion in countries and regions related to the initiative across a wide and diverse range of sectors, including transportation and logistics, power, telecoms, manufacturing, agribusiness and banking.
“The boost to infrastructure connectivity is a priority under the Belt and Road Initiative,” said Gao Peiyong, director of the Institute of Economics at the Chinese Academy of Social Sciences in Beijing.
“That’s because infrastructure development will require a high degree of coordination among countries and regions, the private sector and the public, as well as vast investments of financial capital and material resources.”