Top Shanxi official hosts investment ‘road show’ for struggling coal industry
But intervention by deputy provincial governor will disrupt ‘risk-based pricing’, analysts say
In a rare move, the deputy provincial governor of China’s Shanxi Province has led a group of representatives from nine local coal companies to Beijing, to lobby institutional investors for funding.
But analysts criticised the official intervention, suggesting it could muddy the waters, as China continues to make drastic cuts to capacity within its heavy industries.
Top of the agenda for Wang Yixin, vice-governor of China’s largest coal and coke producing province, was convincing investors to subscribe to bonds issued by “good-quality” coal enterprises.
Seven state-owned enterprises (SOEs) and two private-owned firms from the province’s struggling coal sector formed the group, which hosted an investment “road show” in the capital on Wednesday.
Wang said the provincial government “has a responsibility to campaign for local companies”.
“The cut in overcapacity will force out zombie companies, while good-quality companies will benefit from the process, he said, adding the Shanxi authorities supported the seven SOEs.