BEIJING — China’s private investment is expected to pick up in the second half of the year amid fresh incentives for small- and medium-sized enterprises (SMEs), Xinhua-run Shanghai Securities News reported on Aug 24.
Easing funding strains and costs for SMEs have been high on the agenda of executive meetings of the State Council, China’s cabinet, in the past two weeks.
An executive meeting of the State Council on Aug 22 called for effective implementation of government policies designed to facilitate easier and less costly capital-raising for small and micro-sized firms, while an earlier meeting underscored solid efforts in slashing taxes and fees.
“Measures easing fundraising difficulties for SMEs are a timely boost to entrepreneurs’ confidence in investment,” said Ju Jinwen, a researcher with the Chinese Academy of Social Sciences economic research institute.
The country has introduced a slew of tax-reducing policies for small and micro firms since the beginning of this year, and more are expected to come in the second half.
“There could be more tax cuts, especially in value-added tax, in the second half of the year,” said Li Chao, a research fellow at Huatai Securities, who is upbeat about private investment growth in industries related to the internet and consumption.
In the January-July period, private investment rose 8.8 percent year-on-year, 1.9 percentage points higher from the growth registered a year ago, official data showed.
“Private investment is forecast to rebound and account for an increasingly larger share of the country’s total investment,” said Xie Yaxuan, an analyst with China Merchants Securities.