[BEIJING] China is looking to speed the pace of public-private projects by switching to rewards for those that prove successful, instead of offering subsidies, starting from next year, the finance ministry said on Thursday.
The move came after the state planning agency on Wednesday released a second tranche of project proposals worth 2.26 trillion yuan (S$492 billion) in investment, open for public-private partnership (PPP) funding.
During a three-year trial of the new program, the central government will phase out previous subsidy measures in favour of three levels of rewards, scaled to the size of the investment involved, the ministry said in a notice on its website.
On offer are rewards of 3 million yuan for projects involving investment of less than 300 million yuan; a sum of 5 million for those deploying investments in the range from 300 million to 1 billion; and 8 million for those with investments exceeding a billion, it added.
The finance ministry said it would push incomplete locally-funded public service projects to convert to the PPP model. Successful projects will get a reward of 2 percent of the total debt reduction achieved for local government, it added.
By the end of November, 31.5 per cent of the 1,043 PPP projects the government recommended in May had signed contracts.
In February, an official newspaper said 14 provinces would invest a staggering 15 trillion yuan on infrastructure and other projects, equal to almost a quarter of China's economic output, but funding plans were sketchy.