Fixed Assets Investment
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Miners and China’s Industrial Production, Fixed-Asset Investments
Industrial production, fixed-asset investment Industrial output measures the output of businesses involved in the industrial sector, including manufacturing, mining, and utilities. Fixed-asset investment (or FAI) is a measure of capital spending. It refers to any investment in physical assets such as real estate infrastructure and machinery that are held for more than one year.Fixed-assets investments China’s FAI expanded 8.1% from January to August 2016, which was the same pace as the January–July period. Although the growth rate was better than what analysts were expecting, it was the slowest growth pace in the last 16 years.
Fixed investment growth rate declines in 2016
The improvement in demand for investment will help consolidate the foundation for domestic economic growth in the current year, after fixed-asset investment in the private sector witnessed a mild uptick at the year-end of 2016, the National Bureau of Statistics said on Friday. Official data released by the bureau on Friday showed that in 2016, fixed-asset investment increased by 8.1 percent year-on-year, down by 0.2 percentage points compared with the first 11 months. The decline is in line with the slowing down pace of the government's approval for infrastructural construction projects. The National Development and Reform Commission, the nation's economic regulator, approved 227 fixed-asset investment projects valued 1.7 trillion yuan ($247 billion) in 2016. In 2015, the commission approved a total of 280 fixed asset investment projects, valued 2.52 trillion yuan. Although the year-on-year growth rate of fixed-asset investment slowed down－to the lowest level since 1999－a closer look at the data breakdown points to some promising signs.
Reform incentives for local governments
China will offer preferential treatment, including subsidies, to regions that outperform in areas such as fixed-assets investment growth and entrepreneurship, the State Council, China's cabinet, said on Thursday. The central government will direct more projects and funds to local governments that show clear progress in developing new industries, promoting job growth and that promote public-private partnerships, the notice said. Central government officials have cited weak implementation of reforms and new policies at the local level as reasons for the nation's weaker economic performance, including record low private-sector investment growth this year. Factors hindering policy implementation include an ongoing corruption campaign that has made many officials nervous about standing out from the crowd, including by taking the lead on new economic reforms and local protectionism. The incentives offered to local governments also cover steel and coal capacity reduction targets, controlling financial risks, improvements to the business environment and upgrades to the industrial sector.
Knowledge Graph
Examples
1 Cambodia received fixed-assets investment of $720 million from China in the first 10 months of 2016, according to a government report on Tuesday.
2 Investment activity was also stable in November with highlights in certain areas. Fixed-assets investment was 5.41 trillion yuan in November, up 8.7 percent year-on-year, compared with an 8.3 percent growth in October.
3 Other positive signs included steady growth in fixed-assets investment and an unemployment rate below 5 percent in major cities, according to Mao.