China has outlined a massive spending plan worth 4.7 trillion yuan ($725 billion) to provide more reliable transport to some of the country’s more remote regions.
According to People’s Daily, more than 300 new projects have been proposed, including a significant number to connect China’s more isolated and impoverished areas with regional transport hubs using road and rail.
Zheng Jian, a member of the National Development and Reform Commission, said that the spending plans are part of a pledge to bring the entire population above the poverty line by 2020.
“We think access to more reliable forms of movement is the linch-pin to helping people out of poverty. This is why we’ve incorporated rural road construction in our new plans, which will link these remote areas to regional hubs in the next 3-years,” said Zheng.
While China’s size often means that huge numbers can be thrown around without any real sense of perspective, the plan will require an amount equal to nearly 10 percent of the government’s 2015 annual expenditure to be invested each year for three years.
The amount is larger than the 4 trillion yuan stimulus which was pumped into the economy following the financial crash in 2008, leading to a massive surge in Chinese debt levels.
While many economists over the past year have cautioned that China should move away from its dependence on debt-fueled infrastructure spending, Bloomberg quotes a former adviser to China’s central bank as recently speaking out in favor of more investment.
“If China does not increase infrastructure investment now, it may miss a historical opportunity,” said ex-PBOC adviser Yu Yongding. “It is absolutely necessary for the Chinese government to support infrastructure investment to offset the negative effect of declining real estate investment.”
China plans to invest a massive 4.7 trillion RMB into transport infrastructure