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Shi Jianhui: Give full play to the financial functions to support the construction of industrial projects

Industry construction is the source of financial resources and a key support to hedge against the impact of COVID-19. In recent years, hunan provincial party committee, provincial government power projects in the industry, leading the up and down the province industry concentration, and seeks the development wholeheartedly, built with industry than strength, with thick atmosphere of project about hero, a large number of major workplace industrial projects completed and put into production in hunan, and laid a solid foundation for the provincial finance and economic development of high quality, accumulated steam. Hunan province's finance focuses on the construction of industrial projects in the main battlefield, improves the quality and efficiency of the implementation of proactive fiscal policies, to promote the construction of industrial projects to a new level.


1. Sparing no effort in financial investment


The current situation is complex and there is a serious gap between government revenue and expenditure. We must maintain strategic focus, actively develop and expand industries to lay a solid foundation for financial resources, and promote both quantitative and qualitative growth of government revenue. In recent years, The finance of Hunan province has actively optimized the expenditure structure and promoted the financial funds to be more inclined to the real economy and closer to the industrial projects. We will coordinate and integrate funds to support the construction of the "five hundred" major industrial projects. The policy on awards and subsidies for the upgraded version of the "135" project has been introduced, with the aim of raising 3.3 billion yuan of awards and subsidies to support the development of industrial parks across the province. The first batch of awards and subsidies totaling 540 million yuan has been issued this year. We will speed up the issuance and use of local government bonds, and better leverage the role of special bonds in stabilizing investment, shoring up weak links, and promoting industrial project construction. Since 2018, hunan province has lent about 70 billion yuan in bonds to cities and counties. In 2019, 560 enterprises received 376 million yuan in additional tax awards and subsidies for technological upgrading of industrial enterprises. The highest reward of 10 million yuan will be given to the enterprises that enter the list of "Top 100 Provincial High-tech Enterprises" and the enterprises that enter the list of "Top 100 Provincial Enterprises' Tax Contribution" for the first time. For the regions with outstanding annual performance in industrial project construction, the provincial finance will reward 10 million yuan; Special rewards will be given to the management teams of newly entered profitable enterprises of "Top 500 Chinese Enterprises" and "Top 500 Chinese Private Enterprises".


In the next step, hunan provincial finance will closely focus on the decision and deployment of Hunan Provincial Party Committee and provincial government, pay close attention to the construction of provincial industrial projects and promote the implementation of the spirit of the on-site observation meeting. By implementing more active and promising financial policies, hunan provincial finance will push the provincial industrial construction to a deeper and more effective level. We will further strengthen the integration of provincial-level industrial projects, pool financial resources to recruit and attract more powerful industries, and ensure that investment has a clearer direction, more concentrated effort, and more prominent effects. We will optimize the allocation of government funds, with the focus on supporting public service platforms, public infrastructure development, and the development of strategic emerging industries. Seize the development opportunities in the post-epidemic era, and cultivate leading enterprises in the digital economy, online economy, platform economy and unicorns. We will improve the allocation and use of government funds, and adopt more methods such as competitive project approval, third-party evaluation and financial performance evaluation, so as to further improve the fairness, transparency and effectiveness of industrial capital arrangements.


2. "Use more chocolate" in support mode


With large investment in the early stage of industrial projects and long return cycle, financial funds alone are far from enough. We should draw on the invisible hand of a good market to attract more social capital to participate. In recent years, the finance of hunan province actively promote financial support industry development way transformation, widely used in government investment fund, the PPP, replace subsidies with awards and risk compensation way, speed up the implementation from direct to indirect investment, free of charge to guide the leverage change, further enlarge financial capital "multiplier effect", effectively play financial fund "four two dial one thousand jins" role. Relying on Caixin Financial Holding Group, it established and operated investment funds for emerging industries. The total size of the sub-funds reached 39 billion yuan, focusing on new energy, new materials, mobile Internet, cultural and creative industries and other key industries. We will invest 5 billion yuan in a national fund for manufacturing transformation and Upgrading to help build strong manufacturing provinces. We will invest 1 billion yuan in the establishment of the National Green Development Fund to accelerate the development of green industries. By the end of 2019, there were seven industrial investment funds directly funded by the provincial level, with 252 investment projects with a total investment amount of 6.78 billion yuan. We will encourage all localities in Hunan to use the standard PPP model, and the provincial finance will subsidize the initial expenses to attract social capital to invest in the construction and operation of local industrial parks.


In the next step, hunan provincial finance will further clarify the boundary between the government and the market, identify the meeting point between industrial construction and social capital investment demand, innovate investment and financing methods, enlarge the scale of social investment, and promote industrial development. We will speed up the establishment of the Liangshan Fund, which will be mainly invested in innovative high-growth small, medium and start-up enterprises located in Liangshan. We will support private equity investment institutions in the province to increase investment and make regional equity markets better and stronger. On the premise of adhering to the management of negative list of PPP projects, we will actively explore the combination of PPP, REITs and special debts, prudently promote the application of PPP in key areas such as infrastructure and public services, and improve the industrial development environment.


3. "Targeted power" in policy support


Industrial development involves a wide range of areas and long lines. We must give guidance according to different categories, respond to specific problems, use a combination of fiscal policy toolkits, focus on key areas and take targeted measures to achieve better results. In recent years, hunan financial lead, the rise of open strategy, in-depth implementation of innovation push for financial support of innovation and opening 20, innovative financial 10 provinces construction, promote the development of the open economy 16 and a series of policies and measures to improve the china-eu trains, international routes and other international logistics channel fill award way, hit series policy "combination", push open pace quickened in hunan province, a major innovation constantly emerging, a large number of enterprises "means to sea". We will give priority to supporting the development of 20 emerging industrial chains with strong industrial strengths by putting the existing ones to good use, optimizing their structure, and focusing on investment. We introduced 10 measures to support the development of the road freight and logistics industry, and focused on shoring up weak links in the logistics and transportation industry. We will increase rewards and subsidies to promote the promotion and application of "green public transport" and promote the explosive growth of new energy vehicles in our province. The three levels of provincial and municipal finance are working in the same direction to promote the clustered development of the mobile Internet industry in Changsha, making Changsha the "fifth city of mobile Internet" after Beijing, Shanghai, Shenzhen and Hangzhou. Support the establishment of Red Earth Airlines in Hunan province, to achieve the province's airlines zero breakthrough. Special funds, bond funds, tax rebates and other financial measures will be used to support the construction of yuelu Mountain University Science and Technology City and Malan Mountain Video Creative Park.


In the next step, Hunan provincial finance will aim at the needs of industrial development, focus on the "refinement" and "precision" of policy support, support the deepening of the "per-mu theory hero" reform, promote the combination of industrial development and tax growth, and enhance the fiscal and tax contribution of industrial development. We will continue to increase investment in building innovative provinces and in building an open economy, and support the development of the domestic market for marketable export commodities. "One Enterprise and one Policy" introduced a group of leading projects with strong effect driven by clusters in the fields of electronic information, construction machinery, automobile manufacturing, etc., to upgrade the modernization level of the industrial chain. We will implement well-classified and precise awards and subsidies to build a number of distinctive and competitive industrial parks, making them poles of growth for industrial clusters and driving development.


4. "make every effort" to solve problems for the company.


We will focus on the pain points, difficulties and blocking points faced by enterprises in their development, give full play to the role of public finance, and help enterprises solve practical problems. To address the heavy burden of taxes and fees on enterprises, we will resolutely implement the central government's policy of reducing taxes and fees, and reduce government revenue in exchange for increasing business efficiency and multiplying market vitality. We will reduce taxes and fees by 53 billion yuan in 2019. We will cut taxes and fees even more aggressively this year, and the total is expected to reach 55 billion yuan. To address the problem of difficult and expensive financing for enterprises, we will improve the system of government financing guarantee and re-guarantee, improve the efficiency of guarantee institutions, and reduce financing costs for real enterprises. We explored and launched a series of products, including foreign trade Caiyinbao, Park Caiyinbao, agricultural credit Tan-grain Loan, and hunongtan-Oil tea Loan, and extensively used policy tools, such as financing by pledge of intellectual property rights and financing by government procurement contracts, to help alleviate the financing difficulties of new business entities. We will establish a financial credit risk compensation mechanism at the provincial and county levels to guide financial resources toward private and small and micro enterprises. In view of the difficulty in product sales of small and medium-sized enterprises, government procurement has been intensified. The amount awarded to small and micro enterprises in provincial government procurement contracts accounts for 90% of the total procurement amount, so as to promote the development and growth of small and micro enterprises. We took the lead in the country in introducing the policy for the first purchase of two-type (green) government procurement products, and supported the accelerated development of environmental protection technology enterprises. In view of the enterprise for the fiscal and taxation policy to master problems such as not timely, incomplete, take "tew tax cuts JiangFei" publicity materials, a financial support innovation and opening press conference, combing tax preferential policies during the 290 list, a epidemic prevention and control tax preferential policy guidance and so on a variety of ways, to promote financial enterprise policy is deeply rooted in the hearts of the people.


In the next step, the finance department of Hunan Province will fully promote the reform of "one thing at a time", deepen the reform of "delegating control and services", and further optimize the business environment. We will closely track the implementation of the tax and fee reduction policies, strengthen supervision and guidance, and ensure that preferential tax and fee policies are fully implemented. The function of government procurement policy can be used to attract investment, innovate technology, promote the development of small and medium-sized enterprises and improve the industrial structure. We will continue to reform the ways of providing financial support, such as loan risk compensation, emergency lending, and discount interest on loans, to further reduce financing costs for small and medium-sized enterprises. We will promote the re-guarantee system to cover all eligible counties and urban areas, and actively expand policy-based financing guarantee businesses and market-oriented guarantee businesses. We will expand the coverage of credit risk compensation mechanisms at the provincial and county levels to allow more small and medium-sized enterprises to enjoy policy dividends.


Source: Ministry of Finance, PRC