China's local authorities diversify ways to help resume production

Ramping up credit support and deferring payments, cities across China have taken measures to help companies resume production as the country vowed to restore social and economic normalcy amid the coronavirus outbreak.

Such efforts are particularly gaining steam in the country's 20 industrial transformation demonstration zones, which are tasked with upgrading local industries to bolster growth.

To boost market confidence and soften the pinch on small and medium-sized enterprises (SMEs), cities including Changchun in northeastern Jilin province, Tongling in eastern Anhui province and Xiangtan in central Hunan province will lower interest rate by 10 to 30 percent, according to the National Development and Reform Commission.

The city of Loudi in Hunan injected risk compensation funds into the banking system to mobilize financing for SMEs of more than 1 billion yuan (about $142.8 million), and set aside 20 million yuan to discount interest payments for companies hit hard by the outbreak.

Local authorities have also sought to help companies lower spending, with the city of Shaoguan in Guangdong province cutting or scrapping real estate tax and urban land use tax.

Other measures include subsidizing power and logistic cost, as well as supporting start-up companies.

China's State Council on Feb 18 issued a guideline requiring local authorities to work out differentiated measures to fight the outbreak and resume economic and social order based on the risk level of the regional epidemic situation.

Low-risk regions shall focus on preventing an influx of the virus while fully restoring normal life and production, said the guideline.

The Ministry of Commerce reiterated in a circular on Feb 19 about enhanced support to help foreign-funded firms resume work by making good use of related policies in place.