China cool-headed in face of meltdown

BEIJING - The plunge of China's stock market on Thursday has bred as much anxiety in investors as the recent meteoric rise brought them euphoria.

The benchmark Shanghai Composite Index nosedived 6.5 percent by the close, with analysts loudly advising against panic, crying that short-term volatility does not alter a long-term run supported by economic restructuring and new growth potential.

"Don't panic!" applies to policymakers too, who are expected to stay cool-headed, focused and attentive.

New growth engines, a consumer-led marketplace, industrial cooperation overseas and business-friendly reforms have combined to leave China well placed to cope with the slowdown. Investment in railways, waterways, roads and airports are a strategic device to leverage urbanization, balance regional development and ultimately, drive growth.

Investment leads the way

The National Development and Reform Commission (NDRC), the country's top economic planner, is masterminding three strategic transport projects.

The ambitious Belt and Road transport corridor will connect China and neighboring countries including Thailand, Russia and India. Port cities will expect investment if the maritime Silk Road is to become a reality.

The Beijing-Tianjin-Hebei regional integration in the north and the Yangtze River project in the south both require the building of large transport networks.

"Since the end of last year, policymakers have been well aware of the slowdown. Projects on such a scale indicate the government's desire to stabilize growth through investment," said Zhang Hanya, president of the Investment Association of China.

China spent 2.5 trillion yuan ($407 billion) on railways, highways and waterways last year. Premier Li Keqiang said in March that transport investment this year will be raised further and opened to private investors.