Paper

The Creation of a Favourable Environment for Investment in Rural China: Current Situation and Future Prospects

An overview of rural investments in China
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This paper deals with the sources and use of rural investment in China, focusing on the main problems that exist at the moment and the future direction of the development policy.

As per the paper, the current channels for rural investment in China include investments by:

  • Individual peasants;
  • Government financial channels;
  • Banking channels;
  • Foreign capital;
  • Stock market.

According to the author, some of the main problems being faced that are detrimental to the rural investment climate in China include:

  • Low financial funding support of agriculture by the Chinese Government;
  • Unbalanced internal credit structure of rural financial institutions;
  • Difficulty in obtaining loans from financial institutions;
  • Inability of agricultural insurance to meet the requirements of agricultural development;
  • Low proportion of foreign commercial investment in agriculture;
  • Limited use of the stock market for raising funds for agriculture.

The author concludes by suggesting the following measures as future direction for China's rural policy development:

  • Formation of channels for the stable growth of investment in basic agricultural facilities;
  • Appropriate use of public financial funds for supporting agriculture;
  • Comprehensive reform of the rural financial system as a whole;
  • Establishment of a policy-related agricultural insurance system;
  • Widening the channels for funding resources to support agriculture.

About this Publication

By Jun, H.
Published