More Sectors to Open Up for Private Investment
China will open up more industries, including oil
drilling and defense technology, to private investors to
cope with slowing private investment growth, Xinhua-run
Economic Information Daily reported Monday.
The government will also lure private investment into
strategic emerging industries by setting up industrial
investment funds, according to the report.
Nur Bekri, head of the National Energy Administration,
told the newspaper that the reform plan of the oil and
gas industry had gained government approval and would
soon be released. The sector will open its competitive
operations to private investment as per this year's
government work report.
"Access restriction is one of the major factors that
constrain China's private investment, especially in the
energy and military industries," said Li Wei, head of the
Development Research Center of the State Council.
Private investment is even encouraged in the defense
science and technology industries, including China's
Chang'e-4 lunar probe mission, which aims to be mankind's
first soft landing on the far side of the moon in around
"Widening access for private capital to enter these
industries, together with improved regulation, will both
boost development efficiency and stimulate private
investment growth," Li said.
Growth in private investment slowed to 3.2 percent year
on year in 2016, 6.9 percentage points lower than in
2015, due to poor performance in manufacturing, service
and mining sectors, as well as continued price decline of
investment in fixed assets.
But the downward trend was reversed after the government
moved to spur growth, with private investment recording
growth of 6.7 percent in the first two months of the
China's local governments are also working to attract
private capital into cash-strapped strategic emerging
industries, which have found it difficult to get bank
loans as many start-ups are yet to turn patents and
intellectual property into profits.
As these industries have now become major growth engines
in many regions, local governments are considering ways
of luring private investment such as public-private
partnerships and industrial investment funds, according
to the report.
Government-led industrial investment funds are expected
to play a guiding role in leading private capitals into
the strategic emerging industries, it said.
China aims to increase output of strategic emerging
industries to account for 15 percent of GDP by 2020.