A government-run think tank said urban fixed-asset investment (FAI) may decelerate in 2009 despite heavy government spending, Reuters reported. In a report published in the China Securities Journal, the State Information Center (SIC) said there was a risk investors would not follow the government’s lead. Lower profits and poor stock market performance are seen as dampening enthusiasm for capital spending. Urban FAI increased 26.8% year-on-year in the first 11 months of 2008. Private investment made up more than 77% of total spending, with government spending contributing only 3.88%. The rest came from bank loans and foreign investors.
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