China plans to complete 165 key projects during the 13th Five-Year Plan (2016-20) period, and will welcome the participation of social and private capital, a senior official said on Aug 23.
“Those key projects, involving many industries, will provide a big stage for private investors,” said Hu Zucai, vice-minister of the National Development and Reform Commission, the country’s top economic planner.
“To encourage and guide private capital to invest in those significant projects, the government will provide a fair market with clear direction,” he said.
Hu said the central government takes private capital seriously. It will further open sectors including civil airport construction and oil exploration to private investors. In the past, those fields were dominated by State-owned enterprises.
Private investment has been weak since the beginning of the year.
For the first seven months, China’s investment in fixed assets increased by 8.1 percent year-on-year, a 17-year low, while private investment created the lowest year-on-year growth in history, according to the National Bureau of Statistics.
Private investment in the oil and gas sector declined by 20.7 percent year-on-year for the first seven months, and investment in the iron ore industry dropped by 37.4 percent year-on-year, which aroused public anxiety.
Premier Li Keqiang held an executive meeting of the State Council in June, asking departments to find problems facing private investment and try to take actions to stimulate private investments.
Hu said the government will offer better service for private investors, including shortening the approval process and further opening markets.
Under the plan, private investors will have equal rights with State-owned companies in fields including medical care, education and infrastructure construction.
The 165 projects were selected on the basis of the opportunities they bring to related industrial chains.
Xu Shaoshi, head of the NDRC, said in June that the problem of overcapacity has affected private investment.
“They will not invest in the traditional industries, and it takes time to cultivate technology and management teams to invest in emerging industries,” he said.
Lin Boqiang, director at the China Center for Energy Economics Research at Xiamen University in Fujian province, said certain industries, such as oil and gas, are difficult for small private investors, who are limited by technology and huge capital requirements.