China’s central bank said on Wednesday it has set up a relending facility worth more than RMB 200 billion ($27.59 billion) to help manufacturers and other companies upgrade their equipment, as part of a push to revive flagging demand, reports Reuters. The People’s Bank of China (PBOC) said in a statement that it will provide low-cost funds to financial institutions and guide them to lend to firms to support such upgrades.
The loans will be issued on a monthly basis, and the interest rate for qualified firms will be no higher than 3.2% from September 1, 2022 to December 31, 2022, the central bank added. China’s one-year loan prime rate (LPR) is currently 3.65%.
The lending facility will support sectors including education, health, culture, tourism and sports, electric vehicle chargers, urban underground facilities, new infrastructure and industrial digital transformation, the central bank said.