Throw open the doors to private investors, Chinese premier tells provinces
Premier urges provincial governors to cut red tape after growth in non-state sector investment slows, particularly in the country’s northeast
Chinese Premier Li Keqiang has urged governors from around the country to cut red tape and foster private investment amid sharp falls in non-state spending.
Li’s comments to the provincial officials in Beijing on Monday comes after a noticeable slowdown in private investment growth, a sector that accounts for the lion’s share of overall capital spending.
While the mainland managed to keep headline GDP growth at 6.7 per cent in the second quarter with state-led infrastructure spending and a credit-primed property rebound, growth in capital spending from private investors slowed to 2.8 per cent in the first half from 3.9 per cent in the first five months, official data showed. At the same time, state sector investment rose 23.5 per cent.
Of particular concern are sharp drops in non-state investment in places like Liaoning province, where private investment fell 58.1 per cent in the first half compared to the same period a year earlier.
“Some comrades argue that private investment plunged in the northeast because more infrastructure had been completed there after years of construction, so the room for additional investment is small. But is this really the case?” Li was quoted as saying in a statement on the State Council’s website late on Tuesday night.