Key projects, private investment to play bigger role in pushing growth

China's acceleration of major infrastructure and strategic projects is driving investment and, consequently, economic growth amid global headwinds, analysts said.

They said such projects will attract increased participation from the private sector, shore up industry chains and generate long-term benefits as they are aimed at serving the nation's goal of achieving modernization.

With enhanced fiscal support such as the issuance of ultra-long-term special bonds stabilizing China's economy, projects that serve integrated development along the Yangtze River, farmland upgrades and urban utility renovation saw faster construction progress.

China has issued 500 billion yuan ($69.4 billion) worth ultra-long-term special bonds this year and 700 billion yuan in 2024.

"There was an increasing amount of capital flowing into the infrastructure sector in the first quarter, driving up the construction pace of many major projects nationwide," said Long Chaocan, an investment consultant at China Galaxy Securities Co Ltd.

According to the National Bureau of Statistics, infrastructure investment grew 5.8 percent in January-April, 1.8 percentage points higher than the investment growth overall. Fixed-asset investment rose 4 percent year-on-year during the period, totaling 950.3 billion yuan.

Among the projects, hundred-million-yuan-plus projects surged 6.7 percent on a yearly basis, lifting total investment by 3.8 percentage points, the NBS said.

Private investment, excluding real estate, jumped 5.8 percent year-on-year during the first quarter.

Long from China Galaxy Securities has forecast quicker gains in infrastructure projects in the second quarter.

"The nation's efforts to shore up the private economy are seeing positive feedback. With measures including widening market access, enhanced funding support for private firms, as well as the implementation of the Private Economy Promotion Law, the sector is expected to play a bigger role in boosting investment."

The National Development and Reform Commission, China's top economic regulator, greenlit 27 fixed-asset investment projects worth 573.7 billion yuan in the first four months.

The projects primarily focused on energy, agriculture, forestry and water conservation, as well as high technology.

The NDRC approved in April eight fixed-asset investment projects worth 377.1 billion yuan.

State-owned contractors are seen accelerating infrastructure projects, according to project progress reports released by the companies.

For example, China Railway Construction Corp, a centrally-administered enterprise, said its 24th bureau undertaking construction of the Nanchong-Tongnan Expressway achieved a milestone in a bridge project in Sichuan province.

The builder said it had recently installed the final girder for the left span of a bridge along the expressway. A total of 64 prefabricated segments have been installed onto the bridge, located in Suining's Pengxi county, Sichuan province.

Scheduled for operation in 2026, the expressway aims to enhance road links between Chongqing and Sichuan, and facilitate trade ties between the two provincial regions, CR24G said.