Infrastructure Construction

Official statistics showed that China’s fixed-asset investment (FAI) grew 8.9 percent year on year to 4.14 trillion yuan (US$600bn) in the first two months of 2017, up from 8.1 percent in 2016. FAI includes capital spending on infrastructure, property, machinery and other physical assets, and in 2016 FAI nationwide accounted for over 80 percent of GDP growth, up from 61.8 percent in 2011. At a time when the growth rate of exports is increasingly affected by a growing range of factors and slowing consumption rate, increasing FAI remains a key choice for Chinese authorities to sustain economic growth. Economists cautioned that it is unsafe and unsustainable for economic growth to be driven by investment and there is an urgent need to optimize investment structure, cut logistics costs, prevent debt risks and increase investment efficiency.