Chinese Gov’t To Roll Out New Slew of Funding
Feb. 13 – As the Lunar New Year rolls through, the Chinese government has revealed plans that will provide greater funding and fiscal support for the development of its various sectors and industries.
As China seeks to become highly efficient and recyclable in its resource use, it will aim to boost the annual output value of its resource recycling industry to RMB 1.8 trillion (US$287 billion). Major tasks listed in the plan include the building of nationwide industrial and agricultural systems which are cleaner and allow additional recycling of renewable resources.
According to the National Development and Reform Commission (NDRC), China’s top economic planning commission, China wishes to increase resource productivity by 15 percent by the end of 2015.
Additionally, the Chinese government has rolled out measures to boost the development of social organizations and to better bring their roles into play. As a result, the Chinese government has allocated RMB 200 million (US$32.08 million) to finance non-governmental organizations (NGOs).
According to the country’s NGO administration under the Ministry of Civil Affairs, 377 social work projects and more than 120 training programs are to be carried out with this fund. A total of 17,700 people have already been trained, with 1.85 million people directly benefiting from these programs since 2012.
Furthermore, in an effort to spur its services sector and to make its economy driven more by domestic consumption than by industrial investment and exports, the Chinese government has decided to provide subsidies and rewards for several types of business projects within the services sector. A joint document from the Ministry of Finance and the Ministry of Commerce stated that funds will be allocated from the central coffers to benefit housekeeping, e-commerce, resource recycling, second-hand car trade and other businesses that can either make life more convenient, facilitate the distribution of goods or promote a greener economy.
Specifically, subsidies and rewards to these above mentioned business projects are not to exceed 30 percent of its total investment. The projects can also receive subsidies on their bank loan interest payments at a rate no higher than the benchmark one-year lending rate for no longer than three years. The services sector is expected to increase China’s gross domestic output by 4 percentage points by 2015 as a result of these subsidies.
Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia.
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