News From China... India

www.chinaview.cn 2008-11-22 10:23:13

Special Report: Global Financial Crisis 

    by Xinhua Writers Cheng Yunjie, Wang Yaguang     

    WUHAN, Nov. 22 (Xinhua) -- China is rich, at least when you look at its world's largest two-trillion-U.S. dollar foreign exchange reserve and its fiscal revenue that has maintained double-digit growth for years.

    But many officials in the less-developed central interior felt that Beijing had been penny-pinching in financing local projects for most of the year until only recently when the focal task of macro-economic control shifted from curbing inflation to slowdown prevention.

    "The situation reversed completely in less than two weeks. It used to be projects waiting for capital, now it's the other way around," said Qiu Yunyang, chief of the Development and Reform Bureau of Hubei's Zaoyang City.

    To seize the opportunity for a boost of local economy, Qiu and his colleagues have put in extra hours these days to screen out projects that were mostly needed locally and had a better chance of getting a portion of the 100-billion-yuan investment newly endorsed by the State Council, or the Cabinet, for the fourth quarter.

    Under a rare stimulus package, a total of four trillion yuan, equivalent to nearly 78 percent of last year's national fiscal revenue, would be invested in the next two years to boost domestic demand and improve the livelihood of Chinese.

    "That means an upcoming investment boom. but it's not easy to secure central finance. Only those who have a good reserve of projects will have a better chance," Qiu said.

    Amid Zaoyang's 100 projects expected to be started up over the next three years, a large proportion aims to improve people's livelihood ranging from infrastructure, sewage and waste disposal, new energy to water supply pipeline upgrading.

    "Government-funded projects can hardly bring immediate profits, but they have long-lasting social effects, including raising people's life quality and bettering investment environment," Qiu said.

    Earlier next year, the city with a population of one million would welcome its biggest project in history as a pipeline wind through. The project intending to send gas from northwestern Ningxia Hui Autonomous Region to Hong Kong upon its completion in 2011 has secured 93 billion yuan from the central fund. Zaoyang isthe starting point of the Hubei section.

    "We (local governments) have no right to touch the fund. All money will directly go to contractors. But still we can benefit, as it would create jobs, stimulate consumption, generate fiscal revenue and product value," Qiu told Xinhua.