China’s government is looking to embark on another ambitious infrastructure binge and they’re asking for the private sector’s help.
According to Reuters the National Development and Reform Commission (NDRC), China’s state planning agency, earlier today announced more than 1,000 individual infrastructure projects they wish to build totaling $US317 billion in value.
Instead of fully funding and constructing the projects themselves, something that would have been the case in the past, the government is looking to involve the private sector in its ambitious plan through the establishment of a series of public-private partnerships (PPP).
The stance is likely a response to the sharp slowdown in fixed asset investment seen in recent years.
A clampdown on borrowing by heavily-indebted local government authorities, the traditional drivers of infrastructure spending, is the likely reason the private sector has been asked to participate in the financing and construction of these projects.
“The publication of this library of PPP projects is to help speed up the adoption of the PPP model, and to encourage and guide social capital into the provinces, autonomous regions and municipalities,” the NDRC said.
Whether this news is the catalyst or not Chinese equity markets are certainly on another tear today with the Shanghai Composite currently up close to 2.7%, having rallied by a similar amount on Friday.
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