(Yicai) Dec. 12 -- The stabilization and recovery of investment was one of the key economic tasks for next year laid out at the Chinese government’s Central Economic Work Conference held from Dec. 10 to Dec. 11.

Stabilizing investment will involve appropriately increasing central budget investments, optimizing the implementation of "dual-priority" projects such as major national strategic initiatives and key areas for security capability building, better managing the use of local government special bonds and continuing to leverage new policy financial instruments, so as to effectively boost private investment, the conference report said.

Next year marks the beginning of the 15th Five-Year Plan, said Luo Zhiheng, chief economist at Yuekai Securities. A large number of reserve projects are set to begin and large projects will need central government funding. The financing scale of "dual-priority" projects is expected to increase.

The conference also emphasized the continued role of new policy financial instruments. Focusing on expanding infrastructure and manufacturing investment will ease local fiscal pressure, said Wang Qing, chief macroeconomic analyst at Golden Credit Rating International. Similar quasi-fiscal financial tools could be introduced in 2026, likely on a larger scale than in 2025.

Fiscal spending in 2026 is likely to lean more towards "investing in people," with a higher share going into areas such as social security, education, healthcare and technology. Spending on technology, long-term loans for manufacturing, technology loans as well as science and technology innovation bonds is expected to grow rapidly. All these areas will be key to boosting effective investment and stabilizing overall investment.

With stronger policy support and China’s massive market advantage, private investment will usher in a new round of development opportunities, said Sheng Lei, deputy director of the Academy of Macroeconomic Research's Investment Research Institute. Emerging and future industries like new energy, new materials and smart manufacturing are expected to become main drivers of investment and innovation.

Investment fell this year due to ongoing adjustments in the real estate market, intensified domestic competition and declining investment returns. China's fixed-asset investment dipped 1.7 percent in the first 10 months from a year earlier to CNY40.8 trillion (USD5.8 trillion). Of this, private fixed-asset investment tumbled 4.5 percent.

Real estate development investment decreased by 14.7 percent over the period. When excluding real estate, project investment still grew by 1.7 percent. The decline in real estate development investment dragged down overall investment by 3 percentage points.

Editor: Kim Taylor