(Yicai) Sept. 4 -- Shanghai will grant a record CNY4 billion (USD562 million) in subsidies to support the trade-in of consumer goods, such as cars and home appliances.

Eighty-five percent of the subsidies will be funded by ultra-long special treasury bonds issued by the central government, while the remaining 15 percent will be provided by supplementary funds from Shanghai’s finance department, according to a document issued by the Shanghai Municipal Development and Reform Commission and the Shanghai Municipal Finance Bureau yesterday.

The existing subsidies to replace old cars with new energy vehicles will be increased to CNY15,000 from CNY10,000 (USD2,110 from USD1,405), while those to replace them with fuel cars that meet the National VI B Emission Standard will be tripled to CNY12,000, according to the document.

At the same time, the city will implement the latest national car scrapping subsidy policy, which grants consumers discarding vehicles meeting certain conditions with CNY20,000 if they purchase a NEV and CNY15,000 if they buy a fuel car with an engine displacing 2.0 liters or less.

Consumers can enjoy both scrapping and trade-in car subsidies at the same time.

For the trade-in of home appliances and furniture, consumers buying new refrigerators, washing machines, televisions, air conditioners, computers, water heaters, household stoves, and range hoods can receive subsidies of up to CNY2,000, equal to 15 percent to 20 percent of the sales price, based on the energy efficiency level of the appliances.

Moreover, consumers purchasing sofas, mattresses, cabinets, bathtubs, toilets, sweeping robots, vacuum cleaners, and air purifiers that meet specific requirements can enjoy a subsidy of 15 percent of the sales price, with a limit of CNY2,000 per item.

China’s State Council announced a new round of large-scale equipment renewal and trade-in of consumer goods in March. Last month, the National Development and Reform Commission and the Ministry of Finance said they would allocate CNY300 billion (USD42.1 billion) funds from the issuance of ultra-long special treasury bonds to support the implementation of the State Council policy.

Ultra-long special treasury bonds are treasury bonds with a maturity of more than 10 years that are used for specific purposes. China is expected to issue ultra-long special treasury bonds with a total amount of CNY1 trillion (USD140.7 billion) this year, of which CNY250 billion were issued in the first half, according to the MOF.

Editors: Dou Shicong, Futura Costaglione