In February 2023, the People’s Bank of China, the Ministry of Transport and the China Banking and Insurance Regulatory Commission jointly issued the Notice on Further Improving Financial Support and Services in the Field of Transportation and Logistics (“the Notice”), driving the high-quality development of the transportation and logistics industry and the construction of a transportation power.

The Notice emphasizes that the financial sector should give priority to financial services in the field of transportation and logistics, make full use of all policy tools, increase financial support, help smooth the circulation of the national economy, stabilize the industrial chain and supply chain, and promote the coordinated and sustainable development of transportation and logistics with the economy and society.

The Notice requires that banking financial institutions should improve organizational guarantee and internal incentive mechanism, innovate and enrich credit products that meet the needs of the transportation and logistics industry, and earnestly increase credit support. Banks are encouraged to reasonably determine the down payment ratio and loan interest rate of truck loans, appropriately improve the tolerance of non-performing loans within a specific time period of epidemic and economic recovery, and implement arrangements of due diligence and exemption from liability.

The Notice points out that it is necessary to play the guiding role of structural monetary policy tools and the supporting role of bond market financing. The special refinancing for transportation and logistics will continue to be implemented until the end of June 2023, bringing special road freight transport operators, road large object transport operators, road dangerous goods transport enterprises, road freight transport station operators and micro, small and medium-sized logistics warehousing enterprises into the scope of support, and simplifying the application conditions with refinancing application on a monthly basis. Local legal person financial institutions are supported to issue loans related to transportation and logistics by means of refinancing and rediscounting for assisting agriculture and small and micro businesses. Transportation and logistics enterprises are encouraged to issue corporate credit bonds for financing, so as to reduce the financing cost by issuing bonds and improve the convenience.

The Notice proposes to increase market-oriented financial support for transportation and logistics infrastructure and major project construction, so as to help build China into a transportation power. It is required to strengthen the financing support for policy-oriented development financial instruments to invest in transportation and logistics projects, and encourage financial institutions to provide support for improving the layout of comprehensive transportation network, executing major projects in the “14th Five-Year Plan”, and accelerating the construction of rural road network and water transport logistics network.

The Notice requires establishing a sound information sharing mechanism in order to reduce the cost of information collection. Local transportation authorities should promote the improvement of the transportation and logistics “white list” mechanism to facilitate the communication between banks and financing guarantee institutions; establish information sharing and batch verification mechanism with banks within their jurisdiction to reduce the operating costs of banks and market entities. China Transport Telecommunications & Information Center and other units should strengthen information sharing with banks.

The Notice emphasizes that it is necessary to exert the joint efforts of all related parties and provide support and services. Qualified provinces and cities should actively increase supporting policies such as interest subsidy, guarantee and credit enhancement. Branches of the People’s Bank of China, local transportation authorities, and China Banking and Insurance Regulatory Commission should promote the government-bank-enterprise docking and policy publicity and interpretation, and establish a multi-level work docking mechanism, so as to coordinate, promote and follow up the implementation of tasks, and enhance the policy implementation effect.