Implementation of policies is key: expert
The nation's top economic planner said on Thursday that it will actively drive pilot reform programs to accelerate growth in the private sector in Northeast China, which has seen a significant drop in private-sector investment in recent years.
In the first nine months of 2016, total private-sector investment in the three Northeastern provinces of Heilongjiang, Jilin and Liaoning stood at 1.59 trillion yuan ($230 billion), down 30.5 percent from the same period in 2015, said Zhao Chenxin, a spokesman for the National Development and Reform Commission (NDRC) at a press conference in Beijing.
The rate of decline was quite significant, given that the national average figure for private-sector investment still inched up 2.5 percent year-on-year in the same period, according to Zhao.
He noted that the decline in the Northeast was caused by a mix of factors including slower national GDP growth, downward pressure faced by the three provinces and weak investor confidence.
Zhao said that the government will actively promote pilot programs to boost the development of private-sector activity and create a benign investment environment.
Concrete steps include enhancing policy support and reducing tax burdens for private companies; using a negative-list approach to project management; accelerating the establishment of private banks in the Northeast; nurturing new industries and improving traditional industries, encouraging private companies to go abroad, and offering incentives for technological talent.
Twelve cities in the three provinces are involved in the pilot programs, and seven of them have listed Public-Private Partnerships (PPPs) among their objectives.
Sun Zhiming, an expert at the Jilin Provincial Academy of Social Sciences, held a cautiously optimistic view about the development of PPPs.
"Private capital will only be interested when a project has good returns, which will reduce the number of viable projects, and the total investment will be limited. On the other hand, PPPs are definitely a new growth point," said Sun.
"Effective and thorough, grass-roots level implementation of policies rolled out earlier should be given sufficient attention, as deepening these reforms such as tax and fee cuts will directly affect private-sector growth," Sun told the Global Times on Thursday.
Northeast China was the cradle of many industries in China, and the area formerly accounted for much of the country's manufacturing activity.But it has faced resource depletion and a brain drain in recent years.
