The National Development and Reform Commission (NDRC) introduced the special construction funds as one of the major policy tools to maintain steady economic growth and as of now, 1.8 trillion Yuan has been released.

Judging from the current situation, although the special construction funds were released to the projects through funds in the form of equity capitals, these, in essence, are still low-interest loans procured through financing platforms owned by low-level authorities.

In addition, the extremely low capital cost of the special construction fund coupled with the supporting loans from the policy banks will have a crowding out effect on the social capital and the commercial bank loans.