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Chinese government boosts lending to forestry industry
29/05/2009
According to Shanghai security news, additional provisions for China’s forestry industry are to be provided by a number of government departments.
The People’s Bank of China and the Forestry Bureau are among the departments that issued the document detailing the provisions, which include an extension of the loan terms to 10 years while interest rates are to remain at just 1.3 times the benchmark rate.
Currently, lending to forestry businesses is limited to five years and rural residents can only get a loan for one year. However, as trees take a long time to grow, borrowers have been campaigning for longer loan terms.
However, funding has already begun to increase, with loans for forestry increasing by 41.3% last year to RMB 11.7 billion. The industry’s output totaled RMB 1.33 trillion in 2008.
Many of the country’s major forestry firms are recording an increase in share prices as a result of the new news on loans: Shenzhen International Enterprises boosted their trading by 8.28%, Yunnan Jinggu Forestry saw a 10% increase and Shengda Forestry Limited saw its trading increase by 3.99%. China Grand Forestry Green Resource Group saw trading increase by 4.40% and the Fujian Yongan Forestry Group’s price increased by 3.14%.
The People’s Bank of China and the Forestry Bureau are among the departments that issued the document detailing the provisions, which include an extension of the loan terms to 10 years while interest rates are to remain at just 1.3 times the benchmark rate.
Currently, lending to forestry businesses is limited to five years and rural residents can only get a loan for one year. However, as trees take a long time to grow, borrowers have been campaigning for longer loan terms.
However, funding has already begun to increase, with loans for forestry increasing by 41.3% last year to RMB 11.7 billion. The industry’s output totaled RMB 1.33 trillion in 2008.
Many of the country’s major forestry firms are recording an increase in share prices as a result of the new news on loans: Shenzhen International Enterprises boosted their trading by 8.28%, Yunnan Jinggu Forestry saw a 10% increase and Shengda Forestry Limited saw its trading increase by 3.99%. China Grand Forestry Green Resource Group saw trading increase by 4.40% and the Fujian Yongan Forestry Group’s price increased by 3.14%.
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