24 May 2019

Official appraisal reform reveals new centers of gravity

As China says goodbye to the era of breakneck economic growth, it is also striving to find a more sustainable development model that will prevent the economy from stalling all of a sudden. The structural transformation gives investors an idea of where the centers of gravity will be.

The Organization Department of the Communist Party of China Central Committee on Monday released a list of criteria that it will use in assessing the performance of regional leadership. Several priorities were highlighted: technological innovation, education and culture, employment, social security and public healthcare.

Basically, all these weight-bearing areas point to the objective of raising the people’s sense of well-being, and it is on this parameter that the promotion prospects of officials will rest.

Given the rapid environmental degradation in the country, it is expected that local authorities will charge full steam ahead in the coming years to improve the quality of water and air in their respective jurisdictions.

Guodian Technology & Environment Group (01296.HK), the solution provider for desulfurization, denitrification and dust removal, and China Everbright International Ltd. (00257.HK), main contractor for projects of waste-to-energy and wastewater treatment, are likely to see an influx of orders as a result.

Meanwhile, optimizing both the social security net and public healthcare system means that domestic insurers such as China Life Insurance Co. Ltd. (02628.HK) stand a good chance of being awarded more group contracts, which often refer to jumbo insurance policies.

– Contact the writer at [email protected]




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