2020-05-31

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DATA

9,491

Total Projects

14.5

Total Investment

(trillion yuan RMB)

National PPP Integrated Information Platform Project Management Database Third Quarter of 2019

Executive Summary

    The following is a summary of China PPP Integrated Information Platform Management Database as of the end of third quarter of 2019:

 

Projects in Management Database

       For the third quarter of 2019, 412 new projects are included in the database, with an investment of 689.5 billion yuan. Compared with the data of the second quarter, net increase of projects is 213 in the third quarter excluding the removed projects at localities, with an investment of 442 billion yuan; net increase of commercial closing projects reached 228, with an investment of 33.35 billion yuan; net increase of projects entering into construction stage is 113, with an investment of 204.5 billion yuan.

       In September, 123 new projects were included into the Database, with an investment of 278.4 billion yuan, in which 9 projects are the first ones entering into the Database in their administrative area, involving an investment of 10.6 billion yuan, distributed in 9 provinces. Excluding the removed projects at localities, net increase of new projects is 67 compared with the data of the end of August, involving an investment of 183.9 billion yuan; net increase of commercial closing projects is 79, with an investment of 75.7 billion yuan; the projects entering into construction stage increase by 26, with an investment of 24.3 billion yuan.

       Since the beginning of this year, net increase of new projects included in the Database is 595, with an investment of 913.4 billion yuan; net increase of commercial closing projects is 1348, with an investment of 2 trillion yuan; net increase of projects entering into construction stage is 1322, with an investment of 2.2 trillion yuan.

       Since 2014, there have been 9,249 projects with the total investment of 14.1 trillion yuan in the Database; there have been total 6,039 commercial closing projects in the Database with total investment of 9.2 trillion yuan, and the commercial closing rate reached 65.3%; there have been 3,559 projects entering into the construction stage, with an investment of 5.3 trillion yuan, and the construction commencement rate is 58.9%.

In terms of sector distribution: compared to the data by the end of the last quarter, transportation, municipal project, comprehensive urban development, forestry, and ecological construction and environmental protection with the investment of 225.5 billion yuan, 109.7 billion yuan, 62.2 billion yuan, 35.3 billion yuan, and 19 billion yuan respectively ranked top five by net increase of investment; since 2014, transportation, municipal project, comprehensive urban development, ecological construction and environmental protection and tourism with the investment of 4.4 trillion yuan, 4.1 trillion yuan, 1.9 trillion yuan, 967.9 billion yuan and 449.8 trillion yuan ranked top five by accumulated investment. 

In terms of regional distribution: compared with the data by the end of last quarter, Guizhou with 71.7 billion yuan, Tianjin with 67.1 billion yuan, Henan with 60.2 billion yuan, Hebei with 486 billion yuan and Gansu with 45.3 billion yuan ranked top five provinces in terms of net increase of investment. Since 2014, Guizhou with 1.2 trillion yuan, Yunnan with 1.1 trillion yuan, Sichuan with 1 trillion yuan, Zhejiang with 0.9749 trillion yuan and Henan with 0.9505 trillion yuan ranked top five by accumulated investment.

In terms of return mechanism: by the end of September, the total amount of user-pay projects, viability gap funding projects and government-pay projects accounted for 9.4%, 66.8% and 23.9% of total.

In terms of private enterprise participation: there were a total of 5,990 commercial closing projects having their commercial partners’ ownership information in the database, including 10,713 commercial partners, and 34.6% of them are private enterprises. Private enterprises participated in 2,607 closing projects with total investment of 3.0 trillion yuan, sharing 43.5% and 32.6% of those of the 5,990 commercial closing projects.

In terms of fiscal affordability: there were 2,602 local governments with PPP projects in the Database. Among them, the fiscal affordability indicator of 2,583 local governments is under 10%, the ratio cap (also called redline) set by the Ministry of Finance of China; the indicator of 1,866 local governments is below 7% and the indicator of 1,415 local governments is below 5%. There were another 19 local governments’ fiscal affordability indicator is higher than 10%, which means their new projects are forbidden to entering the Database.

In addition, by the end of September, there were 2,994 projects with RMB 3.3 trillion yuan in the Pre-pipeline Database. Projects in the Pre-pipeline Database haven’t entered the Management Database yet.


Body Text

    In accordance with requirements of the Notice on Standardizing the Operation of PPP Integrated Information Platform (CJ [2015] No. 166), China PPP Integrated Information Platform and Management Database was established. The whole life-cycle of a PPP project contains five phases, respectively identification, preparation, procurement, implementation and transfer. The Management Database includes the PPP projects that are in the preparation, procurement, implementation and transfer phases. As of the end of the third quarter of 2019, the report on Management Database is set out as follows:

 

I. Projects in Management Database

In the third quarter of 2019, there were 412 new projects included in the Management Database with total investment of RMB 689.5 billion. By deducting the number of projects removed from the Database by provincial governments, the net increase of project is 213 with the investment of RMB 442 billion compared with the data by the end of the second quarter of 2019. In September 2019, the Management Database project increased by 67 compared with that of August, with an investment of RMB 183.9 billion. the Management Database project added up to 8,843 with the total investment of RMB 13.4 trillion. As of the end of the third quarter of 2019, there were 9,249 projects in the Management Database, with investment of RMB 14.1 trillion.

The commercial closing rate means the rate of the sum of the projects reaching implementation and transfer stages to the sum of projects in Management Database. Compared with the data by the end of the second quarter of 2019, the net increase of commercial closing project is 228 with an investment of RMB 335.9 billion; compared with the data in the same statistic scope as that by the end of August, the net increase of project is 70 and net increase of investments is RMB 75.7 billion in September. By the end of the third quarter of 2019, there were 6,039 commercial closing projects with an investment of 9.2 trillion with a commercial closing rate of 65.3%. The increase of commercial close rate is 1 ppts compared with that by the end of the previous quarter, and 0.3 ppts higher than last month, and up 16 ppts from the end of the third quarter of last year.

The construction commencement rate refers to the ratio of the number of commercial closing projects that have started construction. In the third quarter, the net increase of projects that have entered into construction stage in the quarter is 113, compared with the previous quarter, and net increase of investment is RMB 204.5 billion. The number of projects started construction in September increased by 26 from August and the investment amount was RMB 24.3 billion. By the end of the third quarter, the number of projects started construction was 3,559, and the investment amount was RMB 5.3 trillion; the construction commencement rate of projects is 58.9%, down 0.4 percentage points from the end of the previous quarter, 0.3 percentage points lower than the previous month, and 13.4 percentage points higher than the end of the third quarter of last year.


(I) The Growth of the Projects in the Management Database Tends to Increase while Maintaining Stable.

    As of the end of the third quarter of 2019, there were 9,249 projects with approved value for money evaluation and fiscal affordability assessment, covering 31 provinces (autonomous regions, municipalities) and Xinjiang Corps as well as 19 sectors. Please see Figure 1-1-1 and Figure 1-1-2 for the number and investment amount from January 2018 to the end of September 2019.

Figure 1-1-1 Monthly net increased number of project in Management Database (Nr.)

Figure 1-1-2 Monthly net increased investment of project in Management Database (in RMB 100 million)


 (II) Local Governments Continue to Regulate the Project Entries

In the third quarter, 412 new projects entered with an investment of RMB 689.5 billion. In September, 123 projects entered with an investment of RMB 278.4 billion; 9 local governments had projects in the Database for the first time, involving 9 projects which were distributed in 9 provinces with an investment of RMB 10.6 billion, which means that the number of regions that actively adopt PPP mode is increasing. Meanwhile, a total of 56 projects had been removed involving an investment of RMB 98.7 billion. The investment amount changes due to the restructuring of the brown projects in the Management Database, therefore, the result of the investment amount of the new entries projects minus the investment of the withdraw projects is not consistent with the investment amount of the net increased/decreased projects.

 (III) Regional Distribution of Projects in the Management Database

By net increase of projects in the third quarter of 2019, Henan (46), Jiangxi (18), Yunnan (16), Xinjiang (13) and Sichuan (13) ranked the top five in the list; by investment amount of project entries, Guizhou (RMB 71.7 billion yuan), Tianjin (RMB 67.1 billion yuan), Henan (RMB 60.2 billion yuan), Hebei (RMB 48.6 billion yuan) and Gansu (RMB 45.3 billion yuan) ranked the top five provinces, as shown in Figure 1-3-1 and Figure 1-3-2.

Figure 1-3-1 Net increase of projects in Management Database by region in each quarter of 2018 (Nr.)

 

Figure 1-3-2 Net increase of investment in Management Database by region in each quarter of 2018 (in RMB 100 million)

 

By total number of projects, Shandong (including Qingdao) (761), Henan (726), Sichuan (558), Guizhou (515) and Guangdong (510) ranked the top five and accounted for 33.2% of total projects in the Management Database; by total investment amount, Guizhou (RMB 1.2 trillion yuan), Yunnan (RMB 1.1 trillion yuan), Sichuan (RMB 1 trillion yuan), Zhejiang (RMB 974.9 billion yuan) and Henan (RMB 950.5 billion yuan) ranked the top five and accounted for 37.2% of total investment amount. The comparison of number of project and investment amount of all regions by the end of the second quarter of 2019 and the end of the third quarter of 2019 in each place are shown in Figure 1-3-3 and Figure 1-3-4.

 

Figure 1-3-3 Comparison of number of projects in Management Database between the end of the second quarter and the end of third quarter of 2019 (Nr.)

Figure 1-3-4 Comparison of investment amount in Management Database between the end of the second quarter and the end of third quarter of 2019 (in RMB 100 million)


 

    (IV) Sectoral Distribution of Projects in the Management Database

The Project Database includes a total of 19 primary industries such as energy, transportation, water conservancy, ecological construction and environmental protection, municipal works, integrated urban development, agriculture, forestry, science and technology, affordable housing, tourism, healthcare, senior care, education, culture, sports, social security, government infrastructure and others.

In the third quarter, municipal works (94), transportation (27), ecological construction and environmental protection (26), integrated urban development (25) and forestry (22) ranked the top five by number of projects increased, as shown in Figure 1-4-1.

1-4-1 Number of projects increased in Management Database by industries in the third quarter of 2019 (Nr.)

By increase in investment amount of project entries, transportation (RMB 225.5 billion yuan), municipal works (RMB 109.7 billion yuan), integrated urban development (RMB 62.2 billion yuan), forestry (RMB 35.3 billion yuan) and ecological construction and environmental protection (RMB 19 billion yuan) ranked top five, as shown in Figure 1-4-2.

1-4-2 Increase in investment of projects in Management Database by industries in the third quarter of 2019 (in RMB 100 million)

The number of PPP projects and investment amounts in the Management Database by sector are shown in Figure 1-4-3 and Figure 1-4-4. Among them, municipal works, transportation, ecological construction and environmental protection, integrated urban development and education ranked the top five by number of projects and accounted for 75% of total; transportation, municipal works, integrated urban development, ecological construction and environmental protection and tourism ranked the top five and accounted for 84.3% of total investments.

1-4-3 Number of projects entries in Management Database by industries by the end of the third quarter of 2019 (Nr.)

1-4-4 Investment of projects entries in Management Database by industries by the end of the third quarter of 2019 (in RMB 100 million)

 

(V) The commercial closing Projects

In the first quarter, compared with the data in the same statistic scope as that by the end of last quarter, the net increase of commercial closing project is 228 with total investment of RMB 335.9 billion yuan, and the commercial closing rate is 1 ppt higher than the end of the previous quarter. By the end of the third quarter, there were 6,039 commercial closing projects with total investment of RMB 9.2 trillion yuan, with a commercial closing rate of 65.3%, covering 30 provinces (autonomous regions, municipalities) and Xinjiang Corps except Tibet and 19 sectors. There were currently no projects in the transfer phase. The number of projects at the end of the second quarter and the end of the third quarter of 2019 are shown in Figure 1-5-1.


Figure 1-5-1 Number of projects in preparation, procurement and implementation phase in Management Database at the end of the second quarter and the third quarter of 2019

 

    Regional Distribution. By net increase of closing commercial projects in the third quarter, Jiangxi (30), Anhui (27), Sichuan (27), Zhejiang (17) and Hebei (15) ranked the top five; by net investment of closing commercial projects, Yunnan (RMB 44.6 billion yuan), Gansu (RMB 42 billion yuan), Guangdong (RMB 34.5 billion yuan), Hebei (RMB 33 billion yuan) and Jiangxi (RMB 30.6 billion yuan) ranked the top five, as shown in Figures 1-5-2 and 1-5-3.


 


Figure 1-5-2 Net increase of commercial closing projects by regions in the third quarter of 2019 (Nr.)

 


Figure 1-5-3 Investment of net increased commercial closing projects by regions in the third quarter of 2019 (in RMB 100 million)


    By number of total commercial closing projects in the Management Database, Shandong (including Qingdao) (522), Henan (419), Zhejiang (396), Anhui (377) and Guangdong (373) ranked top five; by total investment amount of commercial closing projects, Zhejiang (RMB 750.5 billion yuan), Yunnan (RMB 745.5 billion yuan), Guizhou (RMB 720.2 billion yuan), Jiangsu (RMB 590 billion yuan) and Henan (RMB 576.7 billion yuan) ranked top five. The number of commercial closing projects and investment in various provinces are shown in Figure 1-5-4 and 1-5-5.

    Commercial closing rate. Beijing (60/67) ranked the first place with 89.6% commercial closing rate; Hainan (84/95) ranked the second place with 88.4% commercial closing rate; Ningxia (40/47) ranked the third place with 85.1% commercial closing rate; Fujian (276/339) ranked the fourth place with 81.4% commercial closing rate; and Anhui (377/475) ranked the fifth place with 79.4% commercial closing rate.


 


Figure 1-5-4 Number of commercial closing projects and commercial closing rate by regions by the end of the third quarter (Nr.)


Figure 1-5-5 Investment of commercial closing projects by regions by the end of third quarter (in RMB 100 million)


Industrial Distribution. By number of commercial closing projects increased in the third quarter of 2019, municipal works (95), transportation (31), integrated urban development (22), ecological construction and environmental protection (16) and as water conservancy (10) as well as healthcare (10) ranked top five. By investment of commercial closing projects increased in the third quarter of 2019, transportation (RMB 125.1 billion yuan), municipal works (RMB 80.5 billion yuan), integrated urban development (RMB 54.8 billion yuan), ecological construction and environmental protection (RMB 17.5 billion yuan) and other (RMB 17.1billion yuan) ranked top five, as shown in Figure 1-5-6 and Figure 1-5-7.

Figure 1-5-6 Net increased number of commercial closing projects

by sectors in the third quarter of 2019 (Nr.)

Figure 1-5-7 Net increased investment of commercial closing projects

by sectors in the third quarter of 2019 (in RMB 100 million)

 

By number of total commercial closing projects, municipal works (2,495), transportation (867), ecological construction and environmental protection (571), integrated urban development (384) and education (276) ranked top five and accounted for 76.1% of the total. By investment of commercial closing projects, municipal works (RMB 3.0 trillion yuan), transportation (RMB 2.5 trillion yuan), integrated urban development (RMB 1.4 trillion yuan), ecological construction and environmental protection (RMB 653.9 billion yuan) and tourism (RMB 212.5 billion yuan) ranked top five and accounted for 84.6% of total investment, as shown in Figure 1-5-8 and Figure 1-5-9.

Figure 1-5-8 Number of commercial closing projects by sector

by the end of the third quarter of 2019 (Nr.)

Figure 1-5-9 Investment of commercial closing projects by sector

by the end of the third quarter of 2019 (in RMB 100 million)

 

(VI) Ownership Structure of Commercial Partners

The type of commercial partners. There were a total of 5,990 out of 6,039 commercial closing projects completing their commercial partners’ ownership information in the database, including 10,713 commercial partners and 3,705 of them are private enterprises, 147 of them are Hong Kong, Macao, Taiwan enterprises, 78 of them are foreign enterprises, 5,537 of them are state-owned enterprises, and 1,246 of them are not easy to be attributed to the above categories, and 34.6% of them are private enterprises (see Figure 1-6-1).

(VI) Ownership Structure of Commercial Partners

The type of commercial partners. There were a total of 5,990 out of 6,039 commercial closing projects completing their commercial partners’ ownership information in the database, including 10,713 commercial partners and 3,705 of them are private enterprises, 147 of them are Hong Kong, Macao, Taiwan enterprises, 78 of them are foreign enterprises, 5,537 of them are state-owned enterprises, and 1,246 of them are not easy to be attributed to the above categories, and 34.6% of them are private enterprises (see Figure 1-6-1).

Figure 1-6-1 Identification and proportion of 10,713 commercial partners

 

Breakdown of sectors with private enterprises’ participation. Private enterprises participated in 2,607 projects with total investment of RMB 3 trillion yuan, sharing 43.5% and 32.6% of those of the commercial closing projects.



 


 



Private-owned and private holding partners were involved in 19 sectoral sectors, as described in Figure 1-6-2 and 1-6-3. Municipal works projects (1,114), ecological construction and environmental protection projects (259), transportation (216), integrated urban development (167) and education (143) ranked top five by number of projects involved with exclusive private capital. Integrated urban development (RMB 822.2 billion), municipal works (RMB 712.6 billion), transportation (RMB 550.7 billion), ecological construction and environmental protection projects (RMB 240 billion) and tourism (RMB 144.8 billion) ranked top five by investment amount of projects involved with exclusive private capital.

Figure 1-6-2 Breakdown of commercial closing demonstration projects participated with private enterprises by sectors (Nr.)

Figure 1-6-3 Breakdown of investment of commercial closing demonstration projects participated with private enterprises by sectors (in RMB 100 million)

 

(VII) Consumption Sector Basic Public Service Projects in the Field of Consumption

The main scope of the consumption sector basic public services covers culture, tourism, sports, healthcare, senior care and education. There were 22 projects, with an investment of RMB 3 billion, increased in the third quarter compared with that of the last quarter. There were total 1,462 basic public services projects with investment of RMB 1.3 trillion yuan, representing 15.8% and 9.1% of total projects and investments in Management Database. By the number of projects, education (440), tourism (320), and healthcare (280) ranked the top three; by investment amount, tourism (RMB 449.8 billion yuan), education (RMB 250.1 billion yuan), and healthcare (RMB 209.9 billion yuan) ranked the top three. See figure 1-7-1.

Figure 1-7-1 Consumption sector basic public service projects in Management Database

 

There were 883 basic public services projects reaching commercial close in the Management Database with investment of RMB 712.8 billion yuan, respectively sharing 14.6% and 7.8% of that in the Management Database. Education projects (276), healthcare projects (186) and tourism projects (171) ranked the top three by the number of projects; by investment amount, tourism (RMB 212.5 billion yuan), education (RMB 161.6 billion yuan), and healthcare (RMB 121.9 billion yuan) ranked the top three. See figure 1-7-2.

Figure 1-7-2 Consumption sector commercial closing basic public service projects in Management Database

 




(VIII) Pollution Prevention, Green and Low-carbon Projects

PPP projects in a number of fields, including public transportation, water supply and drainage, ecological construction and environmental protection, water conservancy, renewable energy, education, science and technology, culture, senior care, healthcare, forestry and tourism, play a role in promoting a pollution prevention, green and low-carbon economic structure. According to such a criterion, there were 169 projects, with an investment of RMB 186.7 billion, increased in the third quarter compared with that of the last quarter; there were total 5,248 pollution prevention, green and low-carbon projects entering the Management Database with investment of RMB 5.0 trillion yuan, accounting for 56.7% and 35.9% of national totals respectively. The commercial closing projects are 3,249 with total investment of RMB 3.1 trillion yuan, accounting for 53.8% and 33.9% of national totals respectively. The comparison between the number and investment amount of the pollution prevention, green and low-carbon projects by the end of the third quarter and the second quarter in 2019 is shown in Figure 1-8-1 and 1-8-2.

Figure 1-8-1 Number of projects at the end of the second quarter and the end of the third quarter (Nr.)

Figure 1-8-2 Investment of pollution prevention, green and low-carbon projects at the end of the second quarter and the end of the third quarter (in RMB 100 million)




(IX) PPP in Yangtze River Economic Zone

The Yangtze River Economic Zone covers 11 provinces/cities, i.e. Shanghai, Jiangsu, Zhejiang, Anhui, Jiangxi, Hubei, Hunan, Chongqing, Sichuan, Yunnan and Guizhou. There were 93 projects, with an investment of RMB 181.9 billion, increased in the third quarter compared with that of the last quarter. By the end of the third quarter of 2019, the total number of project in this region is 4,145 with total investment of RMB 7.3 trillion, sharing 44.8% and 51.5% of those of the Database projects. By the number of projects in the Management Database, Sichuan (558), Guizhou (515), and Zhejiang (507) ranked the top three; by investment amount of the projects, Guizhou (RMB 1.1839 trillion yuan), Yunnan (RMB 1.1183 trillion yuan), and Zhejiang (RMB 1.0079 trillion yuan) ranked top three, as shown in Figure 1-9-1.

Figure 1-9-1 PPP projects in Yangtze River Economic Zone

 by the end of the third quarter of 2019

 

By the end of the third quarter of 2019, the total number of commercial closing projects in this region is 2,713 with total investment of RMB 4.8 trillion, sharing 44.9% and 52.3% of those of the Database projects. Zhejiang (396) ranked the first place by the number of commercial closing projects; followed by Anhui (377) and Sichuan (344); by investment amount of commercial closing projects, Zhejiang (RMB 750.5 billion yuan), Yunnan (RMB 745.5 billion yuan), and Guizhou (RMB 720.2 billion yuan) ranked the top three. See Figure 1-9-2.

Figure 1-9-2 Commercial closing projects in Yangtze River Economic Zone

by the end of the third quarter

 

(X) PPP in Beijing-Tianjin-Hebei Region

There were 17 projects, with an investment of RMB 111.3 billion, increased in the third quarter compared with that of the last quarter. By the end of the third quarter, the total number of project in this region is 489 with total investment of RMB 1.0331 trillion, sharing 5.3% and 7.3% of those of the Database projects. The total number of commercial closing project is 341 with total investment of RMB 700.6 billion, sharing 5.6% and 7.6% of the Management Database projects. See Figure 1-10-1 and 1-10-2.

Figure 1-10-1 PPP projects in Beijing-Tianjin-Hebei Region

 by the end of the third quarter

 

Figure 1-10-1 Commercial closing projects in Beijing-Tianjin-Hebei Region

 by the end of the third quarter




(XI) An Analysis on Return/Payment Mechanisms

By three return/payment mechanisms, in the third quarter, the user-pay projects in the Management Database decreased 1 compared with that of the last quarter, with total investment of RMB 80.1 billion yuan increased; the viability gap funding (VGF) projects increased 194 compared with that of the last quarter, with total investment of RMB 373.4 billion yuan; government-pay projects increased 20 compared with that of the last quarter, with total investment of RMB 11.5 billion yuan. Please see Figure 1-11-1 and 1-11-2.

Figure 1-11-1 Number of projects in Management Database by return/payment mechanisms at the end of second quarter and the end of third quarter of 2019 (Nr.)

Figure 1-11-2 Investment of projects in Management Database by return/payment mechanisms at the end of second quarter and the end of third quarter of 2019 (in RMB 100 million)

 

In the Management Database, there were 621 user-pay projects with investment of RMB 1.3 trillion yuan, accounting for 6.7% and 9.4% of the Management Database respectively; there were 5,266 viability gap funding projects with investment of RMB 9.4 trillion yuan, accounting for 56.9% and 66.8% of the Management Database respectively; there were 3,362 government-pay projects with investment of RMB 3.4 trillion yuan, accounting for 38.2% and 26.1% of the Management Database respectively. See Figure 1-11-3 and 1-1-4.

Figure 1-11-3 Breakdown of projects in Management                              Figure 1-11-4 Breakdown of investment in

Database by   return/payment   mechanism                                projects in Management Database by return/payment

at the end of the third quarter (Nr.)                                 mechanism at the end of   third quarter (in RMB 100 million)


Commercial Closing Projects. In the third quarter, the number of user-pay commercial closing projects increased 9 with total investment of RMB 43.1 billion yuan; the number of VGF (i.e. viability gap funding) commercial closing projects increased 168 with total investment of RMB 269.2 billion yuan; the number of government-pay projects increased 51 with total investment of RMB 23.6 billion yuan.
 

There were total 385 user-pay commercial closing projects with investment of RMB 545.7 billion yuan; 3,011 VGF commercial closing projects with investment of RMB 5.8 trillion yuan; 2,643 government-pay commercial closing projects with investment of RMB 2.8 trillion yuan. See Figure 1-11-5 and 1-11-6.

Figure 1-11-5 Projects in Management                           Figure 1-11-6 Investment of projects in

Database by return/payment mechanism at the               Management Database by return/payment

end of the second   quarter and  at the end of                     mechanism at the end of the second quarter

                  third quarter (Nr.)                                                       and at  the end of third (in RMB 100 million)


(VI) Over Half of the Commercial Closing Projects Have Started Construction 

There were 113 projects, with an investment of RMB 204.5 billion, increased in the third quarter compared with that of the last quarter. By the end of the third quarter of 2019, the total number of project in this region is 3,559 with total investment of RMB 5.3 trillion, sharing 58.9% and 58.0% of those of total commercial closing projects. The rate of projects starting construction decreased by 0.4 percentage points from the previous quarter.

By the number of projects in the Management Database, Shandong (including Qingdao) (400), Sichuan (278), Anhui (273), Guangdong (256) and Zhejiang (225) ranked the top five, with a construction commencement rate of 76.6%, 80.8%, 72.4%, 68.6% and 56.8% respectively; by investment amount of the projects, Yunnan (RMB 502.2 billion yuan), Shandong (including Qingdao) (RMB 414.5 billion yuan), Sichuan (RMB 398.2 billion yuan), Zhejiang (RMB 372.9 billion yuan) and Henan (RMB 307.5 billion yuan) ranked the top five. See Figure 1-12-1 and Figure 1-12-2.

 

Figure 1-12-1 Number of projects entering into construction phase by regions by the end of the third quarter (Nr.)

 

Figure 1-12-2 Investment of projects entering into construction phase by regions by the end of the third quarter (in RMB 100 million)


II. National Demonstration Projects

As of the end of the third quarter of 2019, four batches of National Demonstration Projects totaled 976 with a total investment of RMB 2.1 trillion, covering 31 provinces (autonomous regions, municipalities) and Xinjiang Corps, and 19 sector areas. In particular, the first batch in 2014 totaled 18 (30 at first, 12 of which were subsequently excluded) with a total investment of RMB 51.8 billion; the second batch in 2015 totaled 157 (206 at first, 49 of which were subsequently excluded) with a total investment of RMB 449.9 billion; the third batch in 2016 totaled 421 (516 at first, 95 of which were subsequently excluded) with a total investment of RMB 904.2 billion yuan; the fourth batch totaled 380 (announced in February 2018, 396 at first, 16 of which were subsequently excluded) with a total investment of RMB 598.9 billion yuan. The commercial closing projects totaled 910 with total investment of RMB 2 trillion, covering 19 sector areas.

(I) National Demonstration Projects in Different Phases

Since June 2018, demonstration projects all have been in the procurement or implementation phase. By the end of the third quarter, the number of demonstration projects in the procurement and implementation phases was 66 and 910 with a total investment of RMB 110.9 billion and RMB 2.0048 trillion respectively. The number and investment amount of National Demonstration Projects in different phases at the end of the third quarter and at the second quart of 2019 is set out in Figure 2-1-1 and Figure 2-1-2.

Figure 2-1-1 Number of demonstration projects in each phase (Nr.)

 

Figure 2-1-2 Investment of demonstration projects in each phase

(in RMB 100 million)

(II) More than 90% of the National Demonstration Projects Reached Commercial Close

In the third quarter, there is a net decrease of 2 commercial closing national demonstration project with total investment of RMB 32.7 billion yuan, the commercial closing rate increased 4.8 ppts on year-on-year basis. In September, the number of demonstration projects was the same as the previous month, but total investment decreased by RMB 9.8 billion yuan, and the commercial closing rate increased 0.1 ppts. By the end of the third quarter, total commercial closing projects totaled 910 with total investment of RMB 2 trillion and commercial closing rate of 93.2%. There was currently no project in transfer phase. See Figure 2-2-1 for changes of the overall commercial closing rate of demonstration projects.

Figure 2-2-1 Changes of overall commercial closing rate of demonstration projects

The first batch of the 18 demonstration projects have all reached commercial close since the end of 2016, and the second batch of 157 demonstration projects have all reached commercial close since the end of April 2017; the third batch of 421 demonstration projects have all reached commercial close since April of 2018. 314 of the fourth batch demonstration projects have reached commercial close, and the commercial closing rate is 82.6%. See Figure 2-2-2 for the commercial closing rate of each batch of the National Demonstration Projects.

Figure 2-2-2 Commercial closing rates of four batches of demonstration projects as of the end of the third quarter

(III) Municipal works continued to take the lead

The commercial closing demonstration projects have covered all 19 sector areas. There were 402 municipal works projects out of 910 commercial closing demonstration projects, accounting for 44.2% of the total; there were 94 transportation projects, accounting for 10.3% of the total; there were 87 ecological construction and environmental protection projects, accounting for 9.6% of the total; there were 327 remaining projects, accounting for 36.0% of total commercial closing demonstration projects. See Figure 2-3-1 and Figure 2-3-2 for number and investment of demonstration projects in each sector by the end of the third quarter.

Figure 2-3-1 Number of demonstration projects by sectors

by the end of the third quarter (Nr.)

Figure 2-3-2 Investment of demonstration projects by sectors

by the end of the third quarter (in RMB 100 billion)

 

(IV) Shandong, Henan and Yunnan Ranked Top Three by the Number of Commercial Closing Demonstration Projects

According to regional statistics on commercial closing projects, Shandong (including Qingdao) ranked the first across China with 77 National Demonstration Projects entered the implementation phase, followed by Henan with 74, Yunnan with 72, Hebei with 58, Anhui with 54, Hubei with 52. The remaining provinces are less than 50. See Figure 2-4-1 for the number of demonstration projects and the number of commercial closing projects in each region.

Figure 2-4 Investment of demonstration projects by regions as of the end of the third quarter (in RMB 100 million)


(V) Private Enterprises Participating in the Demonstration Projects Reached about 40%

The type of commercial partners. 910 commercial closing projects are composed of 469 exclusive private capital projects and 451 with a consortium led by private capital. There were 1,630 private partners signing PPP contracts, in which 647 partners were private enterprises, 44 from Hong Kong, Macao and Taiwan, China, 18 from foreign countries, 881 were state-owned, and another 40 enterprises with undefined category. The private enterprises take 39.7% of all the private partners signing PPP contracts with a growth of 0.1 ppts on year-on-year basis (see Figure 2-5-1).

Figure 2-5-1 Identification and proportion of 1,631 commercial partners

 

Breakdown of sectors with private enterprises’ participation. Private enterprises participated in 474 projects with total investment of RMB 779.8 billion yuan, sharing 52.1% and 38.9% of those of the commercial closing projects. Private-owned and private holding partners were involved in 19 sectoral sectors, as described in Figure 2-5-2 and 2-5-3. Municipal works projects (189), ecological construction and environmental protection projects (52) and senior care projects (27) as well as integrated urban development (27) ranked top three by number of projects involved with exclusive private capital. Transportation (RMB 201.5 billion), integrated urban development (RMB 174.0 billion) and municipal works (RMB 151.4 billion) ranked top three by investment amount of projects involved with exclusive private capital.

Figure 2-5-2 Breakdown of commercial closing demonstration projects participated with private enterprises by sectors (Nr.)

Figure 2-5-3 Breakdown of investment of commercial closing demonstration projects participated with private enterprises by sectors (in RMB 100 million yuan)

 

(VI) Shandong takes the lead by number of commercial closing demonstration projects

By the end of the third quarter, 674 commercial closing demonstration projects with total investment of RMB 1.5 trillion have been started, accounting for 74.1% of total, increasing 0.1 ppts on year-on-year basis. Among them, Shandong (including Qingdao) (66), Yunnan (54), and Anhui (51) ranked the top three by number of projects that started construction, accounting for 85.8%, 75.0% and 94.4% of their commercial closing demonstration projects, respectively. Yunnan, Hebei and Beijing ranked the top three by investment amount of demonstration projects that started construction with investment of RMB 193.5 billion, RMB 140.5 billion and RMB 123.5 billion respectively, as shown in Figure 2-6-1 and Figure 2-6-2.

Figure 2-6-1 Number and shares of demonstration projects that have started construction by regions as of the end of the third quarter

Figure 2-6-2 Investment of demonstration projects that have started construction by regions by the end of the third quarter (in RMB 100 million)


III. Fiscal Affordability

To facilitate financial risks management, the National PPP Integrated Information Platform has developed functions of dynamically monitoring local governments’ fiscal expenditure responsibility of PPP projects and consequently fiscal affordability.

According to the monitoring data by the end of October, 2019, there were 2,602 local governments (including provincial level, municipal level, district and county level) have developed PPP projects. Among them, 2,583 local governments’ fiscal affordability indicator are under 10%, the ratio cap (also called redline) set by the Ministry of Finance of China, accounting for 99.3% of total; and the indicator of 1,866 local governments is below 7%, accounting for 71.7% of total, which means their fiscal affordability stays in safety intervals, including 1,415 local governments’ fiscal affordability below 5%. According to Implementation Opinions on Promoting Standardized Development of Public Private Partnership (Cai Jin [2019] No.10), local governments in these places are qualified to apply for new government-pay projects entering the Database. There were another 19 local governments’ fiscal affordability indicator is higher than 10% in certain future years, accounting for 0.7% of total; as a result, their new projects are forbidden to entering the Management Database. As a result of tax cuts and fee reductions and the reduction in the amount of government debt included in the general public budget, expenditures in the general public budgets of some regions in 2018 experienced negative growth compared with 2017, with a small increase in a few regions. In general, the potential financial risks of PPP projects are effectively monitored and controlled.

 

IV. Others

    The third quarter of 2019 witnessed a net decrease of 523 projects with an investment of RMB 682.4 billion in the Pre-pipeline Database; 18 net decrease projects in September compared to August with an investment of RMB 74.3 billion; there were 2,994 projects in the Pre-pipeline Database with an investment of RMB 3.3 trillion.


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6,421

Number of Projects Reaching Commercial Close

10.2

Investment of Projects Reaching Commercial Close
(trillion yuan RMB)

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