China to Undertake Infrastructure Development
Published By : 10 Nov 2014 | Published By : QYRESEARCH
China has approved funds worth US$ 113.24 billion for infrastructure projects. This step has been taken by the Chinese government in order to give an economic impetus to the sluggish economy of China. As a measure for dealing with the issue of the slump in real estate investment, the infrastructure projects will primarily encompass the development of railways and airports.
According to an official at the Xinhua News Agency, the infrastructure project in question received approval from the National Development and Reform Commission. In order to revive greater investments in real estate and property, about sixteen railways and five airports will be built under the infrastructure development project. As per sources, the two main factors that have driven the Chinese government to undertake this infrastructure projects are high inventory in the real estate market and falling sales.
According to the chief economist at the Bank of Communications, the infrastructure projects that were initiated a few years back got completed in 2014, and the infrastructure projects for the coming year are not sufficient. Also, the local economies will be benefitted immensely with the establishment of the new railways and airports. This will also ensure long term growth of the Chinese economy.
The Chinese growth rate slowed down in the third quarter from the second quarter. In the second quarter the growth rate was 7.5% and it came down to 7.3% in the third quarter. This was China’s weakest rate of growth since 2009 in terms of the gross domestic product.
Furthermore, the President of China announced the Silk Road Fund worth US$ 40 billion in order to give a significant boost to the Chinese economy that is currently in the doldrums. Leaders from Myanmar, Bangladesh, Tajikistan, Laos, Mongolia, Cambodia, and China were present during the meeting that was held to discuss the Silk Road Fund.