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China adds $45 billion in stimulus to pay for infrastructure projects

China announced another stimulus measure to finance infrastructure projects, part of its push to drive investment and increase employment in the second half of this year as the economy starts to recover from the effects of Covid lockdowns.

The government will raise 300 billion yuan ($44.8 billion) to finance infrastructure projects by selling financial bonds and other methods, the State Council chaired by Premier Li Keqiang decided Wednesday, according to a report by the official Xinhua News Agency.

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Those bonds are usually sold by policy banks. The money will be used to replenish the capital of major projects such as new types of infrastructure, the statement on Thursday said.

These types of financial tools can help expand effective investment, drive employment and facilitate consumption and allow China to stick to its stance of “not flooding the economy with stimulus or over-printing money,” the meeting concluded, adding that this will help banks achieve a better match between their loans and deposits and improve the transmission of monetary policy.

The People’s Bank of China will take the lead to support China Development Bank and Agricultural Development Bank of China to raise the funds via financial bonds, according to a late Friday report by Financial News, a newspaper published by the central bank.

The top economic planner will come up with a list of projects for the investment, in collaboration with other agencies and state-owned enterprises, it said.

Infrastructure projects are a key factor in determining how fast the economy can grow in the remaining six months of this year as other sources of growth such as housing and private consumption are still slowing.

President Xi Jinping pledged last month to strive to meet economic targets for the year, although Beijing’s Covid Zero strategy has caused analysts to cut their forecasts for annual growth to levels far below the official goal of around 5.5 percent.

The announcement lifted the share price of heavy equipment makers in the onshore market. SANY Heavy Industry Co. climbed 4.1 percent on Friday, Zoomlion Heavy Industry Science and Technology Co. gained 4.9 percent and Jiangsu Hengli Hydraulic Co. rose 1.9 percent, while the benchmark CSI 300 Index dipped 0.4 percent.

New Stimulus

The new stimulus can in theory leverage as much as 1.2 trillion yuan in credit from the banking sector and capital markets, based on the government requirement that the money should be at least 20 percent of overall investment, according to Nomura Holdings Inc. economists including Lu Ting.

But its impact in reality could be much smaller, and won’t be enough to plug an estimated 6 trillion yuan funding gap that the government has to fill if it wants to carry out its proactive fiscal policy, they wrote in a note Friday.

Local authorities are under huge financial stress this year due to the cost of Covid controls and tax cuts, as well as a slump in land sales that reduced a key source of revenue.

The new money is in addition to the 800 billion yuan the three policy banks were told in June to lend for infrastructure projects. That loan quota has already been allocated to the policy banks, local newspaper the 21st Century Business Herald reported Friday, citing sources it didn’t identify.

China Development Bank was allowed to boost lending by 400 billion yuan, Agricultural Development Bank of China’s quota for new credit was 300 billion yuan and another 100 billion yuan was assigned to the Export-Import Bank of China, the newspaper reported.

The development banks’ main source of funds is issuing bonds or loans from China’s central bank, although it hasn’t been announced where the money to finance these new loans will come from.

The size of the additional bonds is only a fraction of what the policy banks normally issue in a year. The banks sold a gross amount of 5.5 trillion yuan bonds in the interbank market last year, with a monthly average of 460 billion yuan, according to Bloomberg calculation based on Chinabond and Shanghai Clearing House data. Between January and May this year, they issued 2.3 trillion yuan in bonds.

The State Council, which is China’s cabinet, also vowed to implement a batch of investment projects that are aimed at increasing workers’ income and boosting their consumption.

These projects will have to spend more than 30 percent of central government funding on paying workers, up from 15 percent previously.

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US: Bodies of two of three missing kids found in Minnesota lake

The bodies of two young children have been recovered from a Minnesota lake, and searchers are still looking for a third they fear may have been intentionally drowned.

Meanwhile, the father of the children died at a different location hours earlier, and their mother is missing. Names have not been released.

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The chain of events began Friday morning when the father was found dead at a mobile home park in the town of Maplewood, near Minneapolis. Police determined that the woman had left with the children, and a search began.

Maplewood Police Lt. Joe Steiner said the woman’s car was found near Vadnais Lake around 4 p.m. Friday. The shoes of the children were found on the shore.

A search of the lake found one child’s body Friday evening. A second body was found overnight. Searchers from several organizations were busy Saturday looking for the third, as well as the mother.

Authorities believe all three children were under the age of 5.

“There’s nothing more tragic than the loss of young children,” Ramsey County Sheriff Bob Fletcher said at a news conference on Friday. He called the deaths a “likely triple homicide.”

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Foreign firefighters arrive in Greece for summer wildfire season

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Foreign firefighters arrive in Greece for summer wildfire season

Several dozen Romanian and Bulgarian firefighters took up their posts in Greece on Saturday, the first members of a European force being deployed to the country to provide backup in case of major wildfires during the summer.

More than 200 firefighters and equipment from Bulgaria, France, Germany, Romania, Norway and Finland will be on standby during the hottest months of July and August in Greece, where a spate of wildfires caused devastation last summer.

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A group of 28 Romanian firefighters with eight vehicles, and 16 firefighters from Bulgaria with four vehicles, were the first to arrive for the two-month mission, financed and coordinated under the European Union’s civil protection mechanism.

“We thank you very much for coming to help us during a difficult summer for our country, and for proving that European solidarity is not just theoretical, it’s real,” Greek Civil Protection Minister Christos Stylianides said on Saturday as he welcomed the members of the Romanian mission in Athens.

“When things get tough, you will be side by side with our Greek firefighters so we can save lives and property.”

The Bulgarian firefighters have been stationed in Larissa, in central Greece.

Last summer’s wildfires ravaged about 300,000 acres (121,000 hectares) of forest and bushland in different parts of Greece as the country experienced its worst heatwave in 30 years.

Following sharp criticism of its response to the fires, the Greek government set up a new civil protection ministry and promised to boost firefighting capacities.

In Greece’s worst wildfire disaster, 102 people were killed when a blaze tore through the seaside town of Mati and nearby areas close to Athens during the summer of 2018.

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One killed, six injured in shootout between migrant groups in Serbia

One migrant was killed and at least six others, including a teenage girl, were injured Saturday in a shootout between migrant groups in Serbia near the Hungarian border, the state-run RTS television reported.

The 16-year-old girl sustained life threatening injuries in the incident that occurred in a forest in the outskirts of Subotica, some 160 kilometers (100 miles) north of Belgrade, where the injured were hospitalized, RTS reported.

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Police, who made no immediate comment, blocked access to the forest where the incident took place, only around a kilometer from the Hungarian border.

Interior Minister Aleksandar Vulin rushed to the scene.

The injured, aged between 20 and 30, have no documents, Subotica mayor Stevan Bakic told local media.

It is not known what triggered the incident, he added.

Local media reported that the shootout occurred between Afghan and Pakistani migrants most likely over human trafficking from the area to European Union member Hungary.

Serbia lies on the so-called Balkans route used by migrants heading towards Western Europe as they flee war and poverty in the Middle East, Asia and Africa.

Although the route is nowhere as busy as it was during Europe’s migrant crisis in 2015, tens of thousands of illegal migrants still cross the region annually.

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