Moreover, investors may be able to capture the increased growth opportunity as governments throw more money into upgrading their infrastructure.
For instance, China recently authorized policy banks to issue new bonds to fund increased infrastructure spending, reports Lucy Hornby for the Financial Times. The first batch of Rmb300 billion, or $48 billion, out of a planned Rmb1 trillion will be issued by policy banks that were recapitalized this spring.
The added spending may be implemented to help stem concerns of a possible slowdown in the Chinese economy, especially after the June sell-off in the A-Shares market.
“Fiscal policies will be the key to growth stabilization measures in the second half,” Zhu Qibing, a macroeconomic analyst at China Minzu Securities Co., told Bloomberg. “The government’s recent signals and policy direction clearly show that a new round of fiscal stimulus is coming.”
Financial advisors who are interested in learning more about infrastructure investments can register for the Thursday, August 6 webcast here.