China’s housing regulator has given the green light to 123.6 billion yuan ($17.20 billion) in development loans and disbursed 29.4 billion yuan through a special programme ‘whitelist’ aimed at providing liquidity to the struggling real estate market, Reuters reported on Wednesday.
The programme, introduced on January 26, enables local governments to suggest housing projects to banks for funding and collaborate with financial entities to fulfil project requirements.
These measures are part of the Chinese government’s initiatives to address the debt issues in the real estate sector and enhance trust in an industry that contributes significantly to the country’s economy.
Currently, 214 cities nationwide have implemented this mechanism, recommending over 5,300 projects to banks. Out of this total, loans amounting to 29.4 billion yuan have been issued for 162 projects in 52 cities.
So far, 214 cities across the nation have set up the mechanism, recommending more than 5,300 projects to banks. Of this total, 29.4 billion yuan of loans involving 162 projects in 52 cities have been issued.
China is looking to boost funding for residential projects, but banks’ unwillingness to lend to the sector could be a significant hurdle for struggling developers.
Developers and analysts have emphasised that these loans are intended to be used specifically for completing certain projects and cannot be used to pay off debt or improve financial stability.
