Workers install gear inside a tunnel in Huzhou, East China's Zhejiang Province on February 2, 2023 for the 25.6-kilometer suburban railway in Hangzhou. Some analysts say infrastructure investment in the first quarter could see double-digit growth as localities ramp up projects across China. Photo: cnsphoto

China has accelerated infrastructure investment in the first quarter of this year to propel economic growth, launching more than 10,000 projects throughout the country.

Analysts estimated that infrastructure investment grew 10 percent year-on-year in the first three months, driving up activity of many associated downstream enterprises and broad market demand for basic materials.

According to incomplete statistics, 14 provinces had announced data on major projects for the first quarter as of Monday, launching a total of 12,571 major projects in sectors including transport, water conservation, advanced manufacturing, modern services and new types of infrastructure. 

The combined investment reached approximately 7 trillion yuan ($1.03 trillion), according to media reports.

Fixed-asset investment in railways totaled 113.55 billion yuan in the first quarter, an expansion of 6.6 percent on a yearly basis, according to data China State Railway Group Co sent to the Global Times.

During this period, track-laying work for the main lines of three high-speed railways was completed, the group said, and breakthroughs were made in a number of key projects.
The sound and stable growth of infrastructure investment in a relatively slack season underscores the improvement in project construction following the adjustment of COVID-19 measures, the government's continuous support in financing, such as increased efficiency of special-purpose local government bonds, Lian Ping, chief economist and head of the Zhixin Investment Research Institute, told the Global Times on Monday.

"A good number of other projects are still in the pipeline," he said.

Recently, work on State Grid Corp of China's two pumped storage projects kicked off in Taishun in East China's Zhejiang Province and Fengxin in East China's Jiangxi Province.

With a combined investment of 14.77 billion yuan, the projects will effectively improve local transport and living infrastructure and drive investment and the development of relevant industries. It's estimated that more than 8,000 jobs will be created, while driving local GDP up by more than 30 billion yuan.

"This sends a positive signal that the authorities are making earnest efforts to prioritize employment in 2023 as mandated in this year's central government work report," Li Changan, a professor at the Academy of China Open Economy Studies at the University of International Business and Economics, told the Global Times on Monday.

He said infrastructure investment will create more jobs and indirectly drive up workers' income, a prerequisite for expanding domestic expenditure. 

"As the country aims to create around 12 million jobs this year, it's expected an average of 1 million jobs will be created each month," he said, urging the authorities to step up efforts to stimulate private investment and expand new infrastructure buildup including 5G, artificial intelligence and the Internet of Things.

Thanks to the government's pro-growth fiscal and monetary policies like the reserve requirement ratio cut and a hike in special-purpose local government bonds, as well as capital market innovations, Chinese enterprises' confidence has revived notably. "Given the sound recovery momentum, GDP growth may have reached 5 percent year-on-year in the first quarter," Li said.