China’s Finance Ministry to launch rewards system for PPP projects

BEIJING - To encourage the spread of public-private partnership (PPP) projects, China’s Ministry of Finance (MOF) has announced that it will begin providing rewards instead of subsidies in a pilot programme that will begin next year. The three-year trial will see the Central Government phasing out previous subsidy measures in lieu of three-tier rewards based on the scale of investment.

For a PPP project with investment of less than RMB300 million (USD 46.3 million), the Central Government will provide RMB3 million in rewards; for a project between RMB 300 million and RMB 1 billion, the reward will be RMB5 million; and project above RMB1 billion, the reward is RMB8 million.

The Ministry said it will also encourage uncompleted locally-funded public service projects to transform into PPP model projects. Those projects that manage to successfully transform will be provided with an additional reward of 2% of the debt reduction the transformation has brought to the local government. www.webershandwick.cn (ATI).