Yesterday, the CIRC and the National Development and Reform Commission jointly issued the Guiding Opinions on Matters Relating to Insurance Industry Support for Major Construction Projects (Development and Reform Investment [2015] 2179). It was clearly necessary to give full play to the unique advantages of long-term investment of insurance funds and insurance industry risk protection and support key construction projects.
Previously, the National Development and Reform Commission (NDRC) has jointly issued the Guiding Opinions on Major Construction Projects in Key Areas Supported by Banking Industry, and now the Guiding Opinions on Matters Related to Insurance Industry Supporting Major Construction Projects, which will open up channels for financial funds to flow to the real economy and alleviate the problem. Investment capital constraints provide effective support.
The Guiding Opinions put forward specific requirements for insurance industry to support key construction projects and promote the development of real economy from four aspects: increasing long-term financial support, giving full play to the function of risk guarantee, perfecting supporting policies and strengthening risk control.
First, increase long-term financial support. Give full play to the advantages of long-term investment of insurance funds, support insurance institutions to participate in major project investment through bonds, investment funds, infrastructure investment plans and asset support plans, further expand investment space, innovate investment methods, and meet the financing needs of major project construction.
The two is to play the role of risk protection. We will actively improve the insurance economic compensation mechanism, increase participation in disaster relief, and vigorously support insurance institutions to strengthen the protection of major construction projects through engineering insurance, catastrophe insurance and reinsurance.
The three is to improve supporting policies. With the support of relevant departments, efforts should be made to solve such obstacles as communication and coordination, information sharing, tax policy implementation, land security and real estate mortgage that have plagued insurance institutions for a long time in major project investment.
Four is to strengthen risk management and control. According to the principle of positive and prudent, we should strengthen the capacity-building of insurance institutions, strengthen territorial supervision, coordinate all over the country, and clarify the relevant responsibilities of market subjects, regulatory bodies and competent authorities.
Relevant officials of the National Development and Reform Commission said that since this year, investment growth has been under considerable downward pressure. In particular, due to poor financing channels, declining profits of enterprises and weakening local financing capacity, the sources of fixed assets investment funds have generally become tighter, which is one of the important factors restricting investment growth. In 1-8 months, the investment in funds increased by 6.8% compared to the same period last year, and the growth rate dropped 6 percentage points year-on-year. Among them, the national budget funds increased by 21.1%, the growth rate increased by 8.9 percentage points over the same period of last year; domestic loans decreased by 5.3%, and the growth rate fell by 17.9 percentage points over the same period of last year.
Next, the National Development and Reform Commission will intensify its efforts, strengthen dispatching and speed up progress, actively promote 11 major projects, six major areas of consumer engineering, three major strategies, international capacity and equipment manufacturing cooperation key projects, especially to promote the construction of major projects identified in the 13th Five-Year Plan as soon as possible. At the same time, we should make a three-year rolling plan for effective investment, set up a reserve mechanism for project planning, reserving, starting and constructing a batch of "four batches" to form a virtuous cycle of continuous and rolling implementation. In addition, we will strengthen the coordination between government, banks, enterprises and associations, promote the integration and docking of government funds, financial funds and social capital with major projects, promote the establishment of a cost-appropriate, time-matching, multi-sustainable fund guarantee mechanism, and smooth the channel of financial capital flows to the real economy.
