Mengniu, Yili to receive US$8 million in interest subsidies

China's top two dairy producers, Mengniu Dairy Co Ltd and Yili Industrial Group Co Ltd, will receive interest subsidies totalling US$8 million from the Chinese government, benefiting from the central government's new policy on loan interest reduction.

The central government Tuesday (Mar 31) announced a new loan interest policy specially tailored for the dairy industry. The payment period of the loans, which enabled dairy enterprises to purchase raw milk, has been extended from three months to six months.

To date, Mengniu has borrowed about US$231.2 million from financial institutions while Yili has borrowed about US$292.7 million. According to the new policy, they can enjoy loan interest reductions of US$3.5 million and US$4.5 million respectively.