829b yuan to beat the downturn

Hunan provincial capital Changsha has unveiled an 829.2 billion yuan (HK$1.02 trillion) stimulus package, prompting speculation it could be a model for other local governments to counter the economic slowdown.

Changsha announced on Wednesday that it would recommend 195 projects to investors this year to attract a total investment of 829.2 billion yuan, in an attempt to 'stabilise economic development', the official China News Service reported.

The announcement follows a 3 trillion yuan stimulus package unveiled by Guizhou's provincial government this month, which will focus on eco-tourism infrastructure.

Capital of the central Hunan province, Changsha is known for heavy machinery and non-ferrous metal industries. Fixed-asset investment was 351 billion yuan last year, including public and private investment. The city's gross domestic product expanded 12.9 per cent from a year ago to 289.65 billion yuan in the first half. The pace was faster than the 7.8 per cent gross domestic product growth of the entire mainland.

The State Council approved a 'strategic plan to promote the central region's economy' after Premier Wen Jiabao said earlier this month China would rely mainly on investments to lift its flagging economy.

The central region includes six provinces - Hunan, Hubei, Shanxi, Anhui, Henan and Jiangxi - which lag behind the coastal region in economic development but are increasingly more appealing to international investors because of their cheaper land and labour costs.