China's top economic planning agency, saying there are many opportunities for private investors in infrastructure projects, pledged to introduce measures to ensure they can compete fairly with state companies.
"We have to create a clear and predictable market environment for private investment," Hu Zucai, vice-director for the National Development and Reform Commission (NDRC) told a press conference on Tuesday. He added that "innovative" forms of private investment, such as the Public-Private Partnership (PPP) should be encouraged if necessary. The official said the 165 key infrastructure projects specified in the country's current five-year plan provide clear direction on how "social capital" -a phrase China uses for private investment - can enter each industry. "I heard some private investors say they have the capital but are not sure where to invest in. I think the [five year] plan provides very clear guidance," Hu said. He said policymakers have recognised that the main challenge for private investment to flow into those projects is eliminating market barriers, as infrastructure has traditionally been dominated by state-owned companies.
Those measures include simplifying bureaucratic approval process and creating a "negative list" that aims to maximise market access for private companies. He also said airports, telecom infrastructure and oil and gas extraction are areas that should be further opened to private investment.
So far, fewer than one-quarter of investment projects announced by the government as public-private partnerships (PPP) have found private investors, government data shows. Investors had signed up for 619 of 2,531 projects with a total value of 1 trillion yuan through the end of July, NDRC said on its website on Tuesday. He said major infrastructure projects are progressing in a "positive and orderly way", but did not give details.