China unveils incentives to boost private investment

China said Friday it will provide subsidies and discount loans to encourage private investment, in the latest step by policymakers to shore up the slowing economy. Private investment accounts for more than 60 percent of China's total fixed-asset investment, the National Development and Reform Commission, the country's top economic planning agency, said in a statement. China's policy makers are stepping up efforts to boost the world's second-largest economy after growth fell to 8.1 percent in the first quarter of 2012 -- its slowest pace in nearly three years. The central bank announced Thursday its first interest rate cut in over three years, after last month slashing the amount of money banks are required to keep in reserves for the third time since December. The State Council, or cabinet, said last month Beijing would encourage private investment in sectors such as the transport, energy, telecommunications and mining industries, which were previously controlled tightly by state firms. The NDRC said investment by the private sector had become "an active force in promoting the stable and fast growth of the national economy". The government will offer subsidies and discount loans to qualified private investment projects and support private venture capital firms by taking a stake or providing financing guarantees, it said. It will also help eligible private investment projects get credit from international financial organisations and foreign governments.