BEIJING — China has been accelerating infrastructure construction for water conservancy, which is expected to spur employment, safeguard grain security and facilitate green development, as the country works to overcome the impacts of COVID-19 with its economy showing momentum in its recovery.

People's Bank of China (PBOC)－China's central bank－will provide better financing for water conservancy projects, as the projects can help absorb large investments and create intensive jobs in the short term, while safeguarding food security, facilitating green development, and relieving natural disasters in the long run, according to a meeting jointly held by the PBOC and the Ministry of Water Resources on June 13.

The central bank urged financial institutions to cooperate with water resource authorities and enterprises and expand effective investments in the construction of water conservancy infrastructure to bolster economic growth.

Policy and development banks should make good use of the newly-granted 800 billion yuan ($119.4 billion) credit line and increase support for major national water conservancy projects.

Commercial lenders should scale up loans for sustainable water conservancy projects, while small and medium-sized banks should provide necessary financial support for local farmland irrigation and water conservancy projects, said the central bank.

The moves are in line with a package of detailed policy measures unveiled by the government last month to further stabilize the economy and better coordinate COVID-19 control and economic development, including accelerating some approved water conservancy projects and speeding up investment in transportation infrastructure.

From January to May, the country initiated 10,644 new water conservancy projects, including 609 projects each with an investment of more than 100 million yuan, according to the Ministry of Water Resources.

China's investments in new water conservancy projects totaled 414.4 billion yuan in the first five months, and the country is expected to complete investments worth more than 800 billion yuan in water conservancy construction in 2022.

The projects will serve purposes such as diverting water from major rivers to regions prone to water shortages, ecological restoration of rivers, flood control, irrigation and safe water supply for rural residents.

Major water conservancy projects usually face difficulties in advancing preliminary work as the process involves multiple departments. The projects also encounter fundraising pressure, which means they rely mainly on government investment.

To address these difficulties, the Ministry of Water Resources and relevant departments have established communication mechanisms to discuss issues concerning the preliminary work of the projects. They have also endeavored to increase financing channels such as special-purpose bonds for local governments, financial capital and social capital while striving to enhance central government fiscal support.

In addition, China is tapping into the sewage treatment market in its vast rural regions as the country plans to ensure that 40 percent of domestic sewage in rural areas is treated by 2025, up from 28 percent in 2020, according to the Ministry of Ecology and Environment.