Chinese state industries open to private investors

In an attempt to boost its slow economy, China announced, late on Wednesday, that it will open 80 projects in eight state-run industries to private and foreign investors.

The decision came after the ruling Communist Party vowed to implement more policy changes and allow entrepreneurs and foreign investors to play a bigger role in the state-dominated economy.

The Chinese industries opened to for business include oil and hydro power, wind power, natural gas storage and distribution, production of photo voltaic equipment for solar power, coal, railways and port operations.

The statement released noted that premier Li Keqiang ‘decided to launch a number of projects to encourage participation of 'social capital' in a number of areas such as infrastructure to promote fair competition.’

The present Chinese economic system that relied on exports and investments is now becoming less profitable, thus forcing the government to make radical changes and rely more on self-sustaining growth based on domestic consumption.

Economists say that China’s state-owned banking system is in urgent need of reform as it presently lends more to government industry and pays little attention to entrepreneurs who create wealth and bring new jobs.

The need for a change becomes even more clear as China’s economy has been gradually declining for the past two years, dropping by 7.7 percent in 2013 and 7.4 percent in the first quarter of 2014.