Global Times | 500 bln yuan policy-backed instruments set to boost project capital: NDRC
This year's meeting of the Political Bureau of the Communist Party of China (CPC) Central Committee proposed establishing new policy-backed financial instruments worth 500 billion yuan, all earmarked to supplement project capital.
An official with the National Development and Reform Commission (NDRC) confirmed at a press conference on Monday that the instruments have been set at a total scale of 500 billion yuan and are specifically designated to supplement project capital.
At present, the NDRC, China's top economic planner, is working with relevant parties to accelerate the allocation of funds from the new policy-backed financial instruments to specific projects. The commission will later urge local governments to accelerate project starts, so forming tangible workload early, expanding effective investment, and promoting steady, sound economic development.
The new policy-backed financial instruments are considered "quasi-fiscal" tools, with the government setting fund allocation areas while operations follow a market-oriented approach. Wu Yaping, a researcher at the NDRC's Institute of Investment, previously explained that the instruments are expected to mainly support emerging industries and infrastructure projects. He added that, with multiple supportive factors in place, infrastructure investment will rebound in the second half of the year and continue to play a stabilizing role in the economy, according to the Shanghai Securities News.
Insiders estimate that the scale of the new policy-backed financial instruments could leverage trillions of yuan in infrastructure investment.
The new policy-backed financial instruments, which are used to supplement project capital, are seen as a positive and effective approach that exerts strong leverage, acting as a catalyst to mobilize social investment and financing, Bian Yongzu, executive deputy editor-in-chief of Modernization of Management magazine, told the Global Times on Monday.
Bian noted that while project capital accounts for only a portion of overall funding in project implementation, it is critical. With sufficient capital, projects can attract more funds from financial institutions, social capital and other channels, thereby accelerating investment progress. The NDRC, together with relevant departments, introduced this instrument precisely to address the shortage of project capital caused by tight local fiscal conditions and to fill a key gap in project development, according to Bian.
"Project investment not only directly stimulates economic growth but also improves livelihoods, addressing pressing development challenges, and lays the groundwork for future economic growth and national competitiveness. The advancement of major projects is therefore significant for stabilizing growth in the short term while also facilitating economic transformation and high-quality development in the long run," he said.
The NDRC had previously made clear that it would seek approval to accelerate the establishment and allocation of the new policy-backed financial instruments. At the same time, many localities are actively preparing and applying for relevant project reserves.
On August 19, Xianning in Central China's Hubei Province held a meeting dedicated to studying the application of reserve projects for the 2025 new policy-backed financial instruments, aiming to speed up the transformation of policy benefits into growth momentum, per Shanghai Securities News.
In addition to the new policy-backed financial instruments, a "package" of measures to expand effective investment is also being rolled out.
Jiang Yi, a spokesperson of the NDRC, said in early August that the NDRC will work with other departments and local governments to strengthen overall coordination and ensure factor support, accelerate project construction, and promote the high-quality advancement of the nation's implementation of supporting major national strategies and building up security capacity in key areas.
As of August 1, the 800 billion yuan project list for this year's implementation of major national strategies and security capacity building in key areas has been fully allocated, and 735 billion yuan of central budgetary investment has been largely disbursed, according to NDRC.