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Rural areas get backing to improve infrastructure

By Xu Wei | China Daily | Updated: 2017-02-07 06:53

Government supports countryside startups by rolling out favorable policies

China is to invest 3.4 trillion yuan ($495 billion) over the next four years to improve infrastructure in rural areas, including water supplies, roads and power supplies, as the government seeks to boost incomes and encourage startups.

Tang Renjian, deputy director of the Central Rural Work Leading Group, the top rural affairs decision-making agency, said on Monday that the central government's only option is to increase investment in the agricultural sector and rural areas in the face of an ongoing economic slowdown.

"We need to put available funding to better use," he said, commenting on the government's first policy document of this year, which was released on Sunday and called for the continuation of supply-side structural reforms to bring fresh momentum to the agricultural sector.

Tang said the cost of road maintenance in rural areas alone could reach 340 billion yuan in the next four years, and so far, authorities have allocated only one-third of that.

To solve the shortage, he said the government will try to raise funds through public-private partnerships and subsidized loans.

The government will seek to establish a variety of investment funds in the agricultural sector, and issue more government bonds that support infrastructure programs in the countryside, he said, adding, "These measures will be like diversion channels that enable social capital to flow to rural areas."

Han Jun, deputy office director of the group, said the policy document prioritizes the development of rural entrepreneurship by rolling out favorable policies for land, financial services and personnel training.

He said the government hopes that startups can attract more talent to rural areas, bringing with them modern methods of production and business operation.

According to Sunday's policy document, China will continue with the minimum purchase price policy for wheat and rice this year, even though the central government announced an end to the floor price for corn in March last year.

However, Han said the authority will set the minimum purchase price for wheat and rice at a reasonable level, one that can reflect the market demand and supply.

Han added that efforts to reduce corn stocks has started to pay dividends, as the price of domestically produced corn was already lower than that of imported corn last month.

Meanwhile, China's import volume for corn and corn substitutes, such as sorghum and barley, has decreased by 30 to 40 percent year-on-year.

The central government document stressed the need to modify the crop structure, encouraging farmers to grow less corn and more soybeans, as well as more corn silage and alfalfa for livestock.

 

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