Saturday, June 11, 2022

Rural Chinese Stimulus Launches

China's agriculture ministry launched a multi-pronged rural investment program in a teleconference broadcast to officials all over the country on June 9. The program is part of a national economic stabilization program ordered by the country's State Council leadership.

Local officials were ordered to resolutely carry out orders from the central communist party leadership to:

  • focus on stabilizing grain production 
  • expand soybean and oilseed production 
  • firm up supplies of seeds, land, and machinery as the foundation for agriculture 
  • nurture industry chains that produce, process and market local specialty products 
  • implement a rural construction action plan
  • move ahead on key tasks in agricultural green development 

These are all initiatives Chinese officials have already prioritized this year for "rural revitalization." Officials were ordered to raise the political position (of spending on rural projects) and be proactive in addressing "pain points," blockages and difficulties in rural areas. 

Officials are to: 

  • combine policies 
  • make sure funds for subsidies and aid are available in a timely manner 
  • increase the proportion of revenue from rural land expropriations used for agriculture and rural projects
  • issue local government bonds to finance the investment program 
  • expand government loan guarantees 
  • increase credit and financial services from banks and insurance companies 
  • broaden channels for "rural backyard strategic investment" 
  • ensure that more "investment from society" flows into rural areas to stabilize the economy.

Last month, the Ministry of Agriculture and Rural Affairs issued a list of preferred investments to guide private investment into the countryside:

  • Investments to ensure food supplies, including "food security industry belts" for grain, cotton, oilseeds, sugar, and rubber; soybean and oilseed production bases; dryland farming; "smart" grain storage; vegetables and greenhouses; "factory-type" concentrated livestock; and fish farming in oceans.
  • Modernized seed companies that combine R&D with commercial seed production in order to create internationally competitive companies.
  • Industries to enrich rural people, including agricultural industrial parks, rural specialty industry clusters, fishing harbor economic zones. 
  • Agricultural processing, food manufacturing, organic agriculture, and geographic-indicated products, storage for grain-cotton-sugar, and cold chain logistics.
  • Rural tourism services, including sightseeing, farm experiences, country houses, and agricultural heritage sites.
  • "Green development", such as collection and utilization of animal manure and crop stalks; recycling agricultural plastics, pesticide bottles, and fishing nets; and disposal of dead animals.
  • Innovation in agricultural science and technology
  • Rural human resources development
  • Rural infrastructure, including upgrades of fields, roads, electric and water facilities; roads for rural industry, mining, forestry and tourism
  • Rehabilitation of rural housing
  • Digital countryside and "smart" agriculture
  • Companies' overseas investment in agriculture and processing "Belt and Road" countries

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