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在线翻译:
szdaily -> Business -> 
Infrastructure boost mulled to cushion growth
    2018-07-30  08:53    Shenzhen Daily

THE government plans to put more money into infrastructure projects and ease borrowing curbs on local governments to help soften the blow to the economy from the Sino-U.S. trade war, policy sources said.

China’s trade tensions with the United States have clouded the outlook for the world’s second-largest economy and roiled financial markets.

The government has ruled out another round of strong fiscal stimulus, wary of inflaming debt risks. A 4-trillion-yuan (US$590 billion) spending package in 2008-09 shielded China’s economy from the global crisis but saddled local governments and State firms with debt.

The amount of infrastructure spending this time will depend on how the trade war evolves, said four sources who are familiar with government policy.

“In the short term, the most effective way is to boost infrastructure investment,” said one policy insider who advises the government. “We will let fiscal policy play a bigger role in supporting the economy as monetary policy is less effective.”

China’s infrastructure investment growth tumbled to 7.3 percent in the first half of the year from 21.1 percent a year earlier — dragging fixed-asset investment growth to a record low — due to stricter checks on investment projects to curb debt risks.

Fiscal policy will become “more proactive,” the State Council said last week, pledging to deliver more tax cuts and quicken the issuance of local governments’ special bonds to support infrastructure investment.

The meeting, chaired by Premier Li Keqiang, also called for banks to ensure funding to existing projects and meet reasonable funding needs of local government financing vehicles (LGFVs), which have been subjected to tight official scrutiny.

“Fiscal spending could be quickened and investment in some projects under construction will be expedited. This will provide support for the economy,” said a second policy insider.

Another insider said China can step up spending on much-needed urban facilities such as parking lots and retirement homes, instead of mega projects.

Policymakers have recently replaced use of the term “deleveraging” with “structural deleveraging,” a change that suggests less harsh curbs on debt.

“The deleveraging should consider external changes and the intensity could be weakened to avoid having a big impact on the economy,” said one of the sources.(SD-Agencies)

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