Thursday, February 09, 2017
Private capital in PPP not optimistic
ANBOUND
China's 2917 economic downward pressure is further increasing, ushering the period of deepening reforms. To re-active private investments and making them taking on more important responsibilities, China puts its hopes in PPP, the reforms of state-owned enterprises and other private investment models. However, Anbound research team believes that at the present stage, because the local governments are psychologically against the private enterprises and the threshold to access to private investment is too high, as well as high private financing costs, lack of legal protection and biases in the understanding of PPP, therefore the future is let optimistic. China should loosen the private investment threshold, reducing obstacles and breaking the monopoly, as well as opening-up private shareholding ratio of state-owned enterprises. If the situation of private investment decline is difficult to reverse, China's economic prospects cannot be optimistic.