China Market Watch: Forestry Sector Output Flourishes and China Railway Corp Releases Construction Plan and Budget for 2017
China looks to increase green energy consumption by 2020
China is aiming to build a clean, low carbon, safe, and modern energy system by 2020. Attention will be paid to the quality of the energy sector’s development by dealing with the country’s overcapacity problems and promoting green energy development. Efforts will also be made to increase market competition among energy and related sectors. This will mean a 15 percent reduction of energy use per unit of GDP by the year 2020, and that non-fossil fuel share will increase to more than 15 percent, with natural gas occupying 10 percent. Persistent air pollution has foregrounded this target, with 62 percent of 338 cities suffering bad air quality last week, according to the Ministry of Environmental Protection. In 2015, 64 percent of energy consumption in China derived from coal, the main source of breathable particulate matter (PM 2.5) which causes smog.
China’s booming forestry sector output
2016 saw China’s forest resource sector output increase to RMB 6.4 trillion, up 5.9 percent on the previous year, reading a 15 fold increase in the last 16 years. The country aims to see the sector’s output reach RMB 9 trillion by 2020. China has become the world’s largest producer, trader, and consumer of forest related products, with foreign trade standing at US$136 billion in 2016. Much of the sector’s growth has come from tourism; 1.2 billion trips to the country’s more than 9,000 forest based destinations were made last year, a 15 percent increase year on year. China has seen 21 new national forest parks opened in 2016, having state investment into forest parks reaching RMB 335 million.
China’s outbound mobile payments surge
Alibaba has reported that outbound mobile payments last year increased by 730 percent year-on-year, driven by the number of people adept and confident in navigating online payments spending on outbound tourism and imported products. Transactions made via online wallets on the e-commerce platform could increase to around 90 percent of total business transactions this year. Alipay accounts for around 65 percent of China’s mobile payment market, which stands at RMB 12 trillion, while overseas transactions makes up around 10 percent. Tencent, which owns WeChat Pay, is quickly tapping into the online payment market, and accounts for 25 percent of the market share. There are now 762 million active users on its instant messaging app, WeChat.
China Railway Corp releases railway plan and budget
China’s state-run railway operator China Railway Corp (CRC) has been assigned a budget of RMB 800 billion for its plans to expand its rail network and increase scheduled trains in the coming year. CRC will add 2,100 km of track to the network, and 4,000 km of track will be electrified. As of last year, there was 124,000 km of railway, which features the longest high-speed rail network in the world, measuring over 20,000 km. One of the main aims of the plan is to improve railway quality in the country’s western regions, which have not benefited from as much investment. In addition to this, projects under the One Belt, One Road initiative will be constructed, including a China-Europe freight service, and other overseas railway projects. China aims to spend around RMB 3.5 trillion during the 13th Five Year Plan (2016-2020).
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