Local governments in China have issued new bonds worth 1.41 trillion yuan (US$201.1 billion) as of March 20 this year, which accounted for 76% of the 1.85 trillion yuan quota pre-approved by the central government, according to the Ministry of Finance.
New bonds for special projects issued by local governments amounted to 1.02 trillion yuan, representing 79% of the pre-approved quota.
Last year, the total amount of all new bonds issued by local governments amounted to 3.06 trillion yuan. Among them, new bonds for special projects totalled 2.15 trillion yuan.
Net proceeds from the sale of new bonds for special projects will be used for the construction of railway, rail transit and other transport facilities, as well as major infrastructure projects in the fields of ecological and environmental protection, agriculture, forestry and water conservancy, municipal and industrial parks.
The bonds issued by local governments to replenish the capital funds for key infrastructure projects has reached 120 billion yuan. These projects can help boost social capital and effective investment, said the ministry.
As the resumption rate of key projects continues to rise, China’s economic growth in the second quarter may exceed expectations, according to a research report of the Huachuang Securities.
Wu Yaping, director of the Investment Research Institute of the National Development and Reform Commission, said Chinese economic growth in the second quarter could reach 6.5% to 7%.
The total equity investment assets managed by Chinese insurance companies has reached 18.8 trillion yuan, accounting for 10.8% of all the funds under the management of insurance companies, the Information Office of the State Council said in a press briefing on Sunday.
Chinese insurance companies have so far invested about 2 trillion yuan in stocks and funds.
The China Banking and Insurance Regulatory Commission (CBIRC) will give insurance companies more autonomy under prudent supervision and plan to allow some insurance companies to set up asset management subsidiaries to increase their equity investment. Currently, Chinese insurance firms can only allocate up to 30% of their assets in equity investment.
The new policy direction is aimed at encouraging financial institutions to directly invest in China’s stock markets, said Zhou Liang, vice-chairman of the CBIRC.
Since March, domestic and foreign stock markets have experienced rare fluctuations due to the rapid spread of Covid-19 overseas and a sudden drop in crude oil prices. During the “earthquake,” a large amount of money entered stock markets through exchange-traded funds (ETFs).
In the first 15 trading days of March, the net inflow of all these ETFs exceeded 43 billion yuan, 32.5 billion yuan of which was invested in technology-related ETFs.
The Huawei Developer Conference 2020, organized by Huawei Technologies for global firms in the Information and Communication Technologies (ICT) sector, will be held in Shenzhen on March 27. The event will be broadcast live through a webcast. It was postponed from February 11-12 due to the Covid-19 epidemic.
Huawei said the event will help build a global platform for exchanging ideas and for trying out new things. The company will show its ICT capabilities and unveil its Kunpeng and Ascend processors during the event.
China Evergrande Group, a Shenzhen-based property developer, said net profit from its core business decreased 48% to 40.8 billion yuan for the year ended December 31, 2019, from a year ago, while net profit fell 50% to 33.5 billion yuan. The decline in profits was mainly due to the decrease in selling prices in some real estate projects.
The story was written by Yang Ying and Xu Jiangshan and first published at ATimesCN.com.