Economy

China provides $42 billion in loans to spend on infrastructure

China provides  billion in loans to spend on infrastructure

BEIJING (Reuters) – China has distributed an additional 300 billion yuan ($42 billion) earmarked for infrastructure projects through three government policy banks as of Wednesday, the official Securities Times reported on Thursday.

The increase in financing was part of policymakers’ support to spur growth in the world’s second largest economy by issuing debt to fund large public works projects.

China’s cabinet on August 24 offered another set of incentives to revive the country’s faltering economy, including increasing the quota on policy financing instruments by 300 billion yuan.

The newspaper said the Export-Import Bank of China has offered 50 billion yuan to fully finance 106 major projects.

As of Sept. 17, the Agricultural Development Bank of China had provided 100 billion yuan in loans to 732 projects.

As of September 20, the China Development Bank has distributed 150 billion yuan in loans to 421 projects.

The money from more than 500 billion yuan of special bonds under interim quotas from 2019 sold by the local government will be used for infrastructure projects in the fourth quarter, ensuring infrastructure investment growth of about 10% over the year, the newspaper said.

China narrowly escaped the economic downturn in the June quarter, weighed down by a deepening recession in real estate, slowing consumption and severe COVID-19 restrictions.

(dollar = 7.1715 renminbi)

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