China approves $112.1bn in subway projects

China has approved 25 subway projects in cities across the mainland as part of Beijing’s push to increase growth as the domestic economy slows, The Wall Street Journal reported. The National Development and Reform Commission approved US$112.1 billion in projects by 18 local governments between June and August, the commission said in a statement on its website Wednesday. Local governments will pay for 40% of funding required on the projects with an expected average construction time of 4.6 years. Nomura economist Zhang Zhiwei compared the project to the ramp up in subway construction around the time of China’s 2009 stimulus package that amounted to RMB4 trillion, saying the news “suggests that the pace of fiscal policy easing has picked up.” Standard & Poor’s Ratings Services recently noted that these planned projects could prompt local governments, logistics companies and the utilities sector to seek new funding sources other than bank loans.