Original Title: Implementation Opinions (Trial) on Implementing the "Grant-Investment-Loan" Linkage Model to Promote the Development of Strategic Emerging Industries

To All Towns, Development Zones, and District-Affiliated State-Owned Enterprises:

These Implementation Opinions are formulated to implement the strategic objectives of the District Party Committee and District Government to build an investment-oriented and collaborative government, and to further optimize the business environment.

I. Guiding Principles

To innovate the methods of fiscal and financial support for economic development, fully leverage the role of fiscal funds in industrial support, policy guidance, and the synergy among fiscal, financial, state-owned assets, and state-owned enterprises, improve the efficiency of fund utilization, effectively address the financing difficulties of small and medium-sized enterprises, and promote the adjustment of our district’s industrial structure and the development of strategic emerging industries, a special fund for the “Grant-Investment-Loan” linkage is hereby established.

II. Basic Principles

The “Grant-Investment-Loan” Linkage Special Fund adheres to the principles of “government guidance, market-driven operations, and standardized management.”

III. Scope of Application

"Grant-Investment-Loan" linkage refers to a comprehensive policy-based fund that integrates multiple capital mobilization methods—including fiscal "grants," state-owned enterprise equity "investments," and financial institution credit "financing"—to enhance policy effectiveness, guide the development of high-tech industries and strategic emerging industries, improve enterprises’ independent innovation capabilities, and promote technological innovation and industrial transformation and upgrading.

The “Grant-Investment-Loan” linkage funds are primarily used to support strategic emerging industries aligned with Fengxian District’s industrial development direction, as well as innovative small and medium-sized enterprises (SMEs) in the start-up or growth stages that demonstrate exemplary leadership and a driving effect.

Projects under the "Grant-Investment-Loan" linkage initiative are sourced from high-quality enterprises identified and recommended by industrial departments, as well as enterprises in the district-owned state-owned enterprise investment project database. During the enterprise selection process, the district’s finance department, industrial departments, and district-owned state-owned enterprises adhere to information sharing and collaborative coordination.Enterprises eligible for “Grant-Investment-Loan” linkage policy support must align with the aforementioned industrial priorities and have their tax registration within Fengxian District. They must also comply with national corporate financial and accounting regulations and maintain sound internal financial management systems and accounting practices.

IV. Funding Sources

The sources of funding for the “Grant-Investment-Loan” linkage primarily include: district-level special fiscal funds, with the district finance department allocating a total of 200 million yuan; special investment funds from state-owned enterprises, comprising fiscal funds contributed by district-affiliated state-owned enterprises such as the Industrial Development Zone, Hangzhou Bay, and Oriental Beauty Valley, as well as Digital Jianghai Company (800 million yuan);investment returns and other appreciation gains from the “Grant-Investment-Loan” linkage funds; and other funding sources. Specific funds will be disbursed gradually based on the project pipeline. Biopharmaceutical enterprises with loan requirements that meet the eligibility criteria for the “Oriental Beauty Valley Loan” may be given priority access to this policy, with the district government providing interest and fee subsidies.

V. Operational Mechanism

A working group composed of the district’s industrial department and the District Finance Bureau will be responsible for specific management and implementation. When utilizing funds directly disbursed by the District Finance Bureau, the working group shall submit an application to the district leaders in charge of finance and industry. Upon approval by these leaders, the District Finance Bureau will disburse funds based on the recommendations in the “Special Fund Project Approval Form for Allocation-Investment-Loan Linkage.”Where fiscal funds from state-owned enterprises are utilized, the relevant state-owned enterprises shall follow the investment procedures stipulated by the District State-owned Assets Supervision and Administration Commission. Special investment funds from state-owned enterprises shall primarily be invested in enterprises through equity investment, with the investment ratio generally not exceeding 5% of the investee’s registered capital, and the state-owned enterprise shall not become the largest shareholder. Financial institutions within the district shall provide corresponding investment-loan linkage financial support based on the disbursed funds and investment funds obtained by the enterprise."Grant-Investment-Loan" linkage funds may also utilize financial leverage such as credit enhancement, re-guarantees, risk compensation, and interest/fee subsidies to establish credit-enhancement financial products aimed at lowering financing barriers and costs for small, medium, and micro enterprises, operating through various methods including credit enhancement amplification, re-guarantees, and risk compensation.

"Grant-Investment-Loan" linkage funds provide targeted services based on the "one enterprise, one policy" principle; in principle, the amount of special fiscal funds received by a single enterprise shall not exceed 10 million yuan.

VI. Supervision and Management

Relevant departments of the District Government shall conduct annual performance evaluations of the “Grant-Investment-Loan” linkage funds, assessing the degree of target achievement and investment operations, and submit a written report to the District Government. Comprehensive assessments of the “Grant-Investment-Loan” linkage funds shall emphasize social contribution indicators such as the guiding role and leverage effect of the funds, the promotion of entrepreneurship and innovation, and the enhancement of technology commercialization.

The District Finance Bureau is responsible for interpreting these Measures. These Measures shall take effect from the date of issuance and shall be implemented on a trial basis for one year.

Fengxian District Finance Bureau, Shanghai

Shanghai Fengxian District Economic Commission

May 31, 2022