Guest Column

Recovery in sight for China's infrastructure segment

  • Published 11 Jun 2009

Yang Liu, chairman of Atlantis Investment Management Hong Kong, talks on sectors set to benefit from China's ensuing splurge in infrastructure spending.

The Chinese government has changed its growth formula from external to domestic reliance. It has gone from export industrialisation to infrastructure urbanisation, demonstrated by the National Development and Reform Commission's (NDRC) announcement that Rmb 1,500bn ($219.4bn, €158.4bn, £138.3bn) of the stimulus budget (37.5%) will be spent on infrastructure construction. Thirty-five percent of China's total investment in 2008 was on infrastructure, including railways, roads, urban power grids, public housing and irrigation projects, and this is expected to grow by 40% in 2009. China is literally building its way towards 8% GDP growth and materials and construction companies are set to be the major winners in 2009-2010.

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