- NDRC unveils three-year plan to grow transport networks
- Infrastructure spending a familiar way of supporting growth
Chinese transportation and infrastructure-related stocks rose after the country’s premier pledged at the country’s annual parliamentary meetings to give top priority to growth and development, with infrastructure and fixed asset investment central to that strategy.
China Railway Construction Corp. rose 4 percent in Hong Kong trading Monday to HK$8.29, while China Communications Construction Co. rose 4 percent to HK$7.88 and Beijing Capital International Airport Co. climbed 3.3 percent to HK$7.45. The China Enterprises Index of Chinese listings in Hong Kong rose 0.8 percent on the day.
Premier Li called Saturday for giving "top priority to development," while China’s top economic planning body launched a three-year action plan to develop major transportation infrastructure, and a draft document of the country’s 13th five-year economic plan pledged to build at least 50 new airports by 2020. Total fixed asset investment is projected to increase by 10.5 percent this year, with infrastructure investment a familiar way for Chinese authorities to shore up the slowing economy.
Saturday’s comments confirm that "the focus is firmly on supporting short-term growth, with the deleveraging can kicked further down the road," Bloomberg Intelligence economists Tom Orlik and Fielding Chen wrote in a note. "The risk is that if stimulus is accelerated but reform continues to lag, the government could end the year with growth on target but even bigger structural problems to deal with."
More than 300 projects will be launched between 2016 and 2018, the National Reform and Development Commission said in its annual report. The projects will focus on building higher-quality rapid-transport networks and improving and expanding basic transportation networks.
The draft of the five-year plan calls for building a new airport in Beijing and upgrading airports in Harbin, Shenzhen, Kunming, Chengdu, Chongqing, Xi’an and Urumqi, among others, so they can function as international hubs.
— With assistance by Clement Tan