Caijing magazine has reported that the Chinese government is to strengthen credit support for petrochemical enterprises, and has pledged to promote the stable development of the petrochemical industry.
A revitalization plan for petrochemical industry was approved on Feb 19. The plan sees petrochemicals playing a significant role in boosting China's economy. Its main provisions are: to initiate large-scale refining projects, stimulate consumption of petrochemical products, improve the fertilizer reserve system in the off-season, and build up reserves of refined oil.
A research report from Guojin Securities said that in a climate of falling foreign demand and structural changes in domestic demand, the real aim of the revitalization plan is not boosting the chemical industry, but maintaining the economic and social stability.
Liu Bo, an analyst from Guojin, said one of the government's aims was to secure domestic supplies in advance of an increase in demand as the economy recovers.
Liu said there is no doubt that financial support for the petrochemical industry will also boost the steel, electronic information, and petrochemical equipment manufacturing; but as regards creating demand, the government should aim to phase out backward production facilities from the market.
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(China.org.cn by Fan Junmei February 23, 2009)