In the deteriorating international economic situation, how can China cope with the dilemma of economic growth slowing down and inflation risks still exist? How will the economic restructuring be realized? Since the beginning of August 2007, when the liquidity of the US and European currency markets was tight, the global financial crisis has been more than four years. The crisis has not eased, but it has become more and more intense. It is only the main form of its transformation from the subprime mortgage crisis of financial institutions to the sovereign debt crisis of Europe and the United States. The risk of a double dip in the global economy has increased. The fundamental reason for the global economic and financial system is unpredictable. The root cause is that the foundation of real growth has been shaken. How long can it be used for over-currency and fiscal overdraft? Can government rescue still work? China’s economic risks have already emerged. Is it a cross-strait view of the fire, or is it self-reflection to avoid similar mistakes? Can we deepen political and economic reforms, open up to the people, strengthen the protection of property rights and innovation mechanisms, find new growth drivers, and avoid the “middle income trapâ€? From November 11th to 12th, “2011 Caixin Summit: China and the World – Looking for Real Growth†is the way to explore the future of the Chinese economy in this context. Wu Jinglian, Research Fellow of the Development Research Center of the State Council, Li Yizhong, Deputy Director of the Economic Committee of the National Committee of the Chinese People's Political Consultative Conference, Guo Shuqing, Chairman of the China Securities Regulatory Commission, Liu Mingkang, former Chairman of the China Banking Regulatory Commission, Cai Esheng, Vice Chairman of the China Banking Regulatory Commission, Chen Wenhui, Vice Chairman of the China Insurance Regulatory Commission, former Deputy Prime Minister of Poland, Koledek, Assistant Secretary of the US Treasury Lago and other guests attended the conference and delivered keynote speeches. During the two-day summit, nearly 100 experts and politicians undertook a full discussion on the theme of “seeking real growthâ€, including the most important issues of 2012, financial turmoil, change and growth, saving the debt crisis, global governance. Hot topics such as China's role, economic cycle and political cycle. Not going back. Given that the lack of monetary and fiscal discipline is the root cause of the financial crisis, and the Chinese economy is in the delicate balance of “guaranteeing growth†and “controlling inflation,†discussions on monetary policy have become hot spots for the summit. In the opinion of many participating experts, although the current domestic inflationary pressure has eased, the inflation risk has not been completely eliminated, which restricts the space for monetary policy to move forward. The most urgent task of policy response is to use monetary policy tools more flexibly, and at the same time speed up the process of financial marketization, so that regulation is more efficient. “The money supply rate has been too fast in the past three years. The cumulative money growth rate exceeds the GDP growth rate by 50%. It is normal for the money growth rate to slow down than the GDP growth rate. It is a correction to the mistakes of the past three years.†Investment in Goldman Sachs According to Ha Jiming, China's vice chairman of the management department, inflation will still be higher next year, labor costs will rise rapidly, and oil prices and commodity prices will rebound in the near future, which means that monetary policy cannot be easily turned. “The growth of credit in the eyes has accelerated, how can the surplus of the past surplus be digested?†Fan Jianping, chief economist of the National Information Center, believes that China’s monetary policy will not go back, and the ideal state is to maintain stability. The monetary authorities should lower the deposit reserve ratio while moderately raising interest rates and use the two currency instruments together. In this way, it is possible to clearly signal to the market that it will no longer continue to tighten liquidity, and it can further control the level of inflation. Fan Jianping said that it is not necessary to make major adjustments in the policy intensity, but to make adjustments in the structure. For example, giving directional easing to SME credit; adjusting the ratio of direct financing and indirect financing, and supporting the need for debt issuance, listing and refinancing for the normal development of enterprises. The domestic financial system has not yet fully realized marketization, which has restricted the efficiency of the use of macro-policy tools. “Either price limit or price limit; either purchase limit or purchase limit, our policies are mostly 'binary', and there are few tools suitable for fine-tuning.†The most important thing is the “fine-tuning tool†that Ha Jiming refers to. interest rate. To make interest rates an effective tool for fine-tuning, the right price signal is very important, so the task of accelerating the process of financial marketization is very urgent. Huang Yiping, chief economist of Barclays Capital's emerging Asian market, believes that China's most urgent task is to liberalize interest rates, that is, to eliminate the control of bank deposit and loan interest rates. But before, management needs to vigorously develop the interbank lending market and bond market. Only in this way can monetary policy tools have a strong place. In his view, many institutions that borrow money from banks, such as government financing platforms and large state-owned enterprises, are mostly long-term projects. These projects, borrowing money from banks, are not the optimal financing channels. This is because while they borrow money from banks, they also limit the flexibility of interest rates. The development of the bond market will not only provide them with a wider range of financing channels, but also help the market to find the true level of interest rates after interest rate liberalization. Another important task of financial marketization is to accelerate the pace of building multiple levels of capital markets and increase the proportion of direct financing through multiple channels. Fang Fenglei, chairman of Houpu Investment Management Co., said that the current focus on improving the multi-level capital market is the new board market and the international board. He believes that the new board market should be accelerated first. This market can rely on the existing three-board market and draw on the Nasdaq system to provide direct financing services to hundreds of thousands of eligible SMEs. On the other hand, it is also necessary to speed up the pace of the international board and integrate it with the internationalization of the RMB and the reform of the foreign exchange system. The government should also promote the opening of other markets. In the bond market, public offerings, private placements, investment grades, and non-investment grades should be allowed. Private equity funds should also be actively developed to allow institutional investors to establish funds for funds. This can avoid the administration of large institutions such as social security funds, insurance companies and other investment entities. Reforms start again China's economy is overly dependent on government-led investment and exports, and it has also paid huge social, environmental and economic costs while achieving rapid growth. This model is recognized as unsustainable, and transformation is the only way for the long-term sustainable development of China's economy. This is further evidenced by the internal and external problems faced by the current economy. The deterioration of the external economic situation has caused problems for exports, but it also provides an opportunity for China's economic restructuring. However, fish and bear's paw can't have both, and the improvement of growth quality will inevitably mean a slowdown in growth rate, which is a pain that is difficult to get rid of during the economic transformation. Under the situation that exports are inevitably declining, how to increase the share of consumption in the economy and guide more efficient investment growth will undoubtedly become the top priority. Li Yang, vice president of the Chinese Academy of Social Sciences, judged that China's economic restructuring and the deterioration of the external environment will continue. Compared with investment and consumption, the export factor will greatly weaken the economy. “Compared with the average of the past 32 years, it is normal for GDP to fall by 1 to 2 percentage points. In the next decade, China may only expect an average growth rate of 8% to 8.5%.†In his view, the economy The adjustment of the growth structure has become an urgent task. An important factor that currently leads to distortions in the investment structure is that in terms of capital allocation, investment is more inclined to government and debt funds than to market and equity funds. From the perspective of the relationship between the central and local governments, funds are mainly in the central government, but urbanization investment is more frequent. "These distortions will undoubtedly restrict the future urbanization process, so it is time to adjust." Li Yang said. The problem with China's economic structure is that, on the one hand, the structural difficulties of economic growth are broken; on the other hand, the excessive administrative influence of the government has led to aggravation of the negative impact of resource mismatch. Xu Chenggang, a professor at the University of Hong Kong, said that the market for administrative intervention in China has continued to strengthen in recent years, resulting in a significant retrogression in resource allocation efficiency. The most distorted resource allocations before were concentrated in state-owned enterprises. In recent years, resource allocation distortions have also grown rapidly in the private sector. This has caused the distortion of the resource allocation of China's national economy to have regressed to the level of the mid-1980s. Taking the real estate market as an example, Xu Chenggang analyzed that the special high price of the Chinese real estate market is fundamentally due to the government's restrictions on land supply, especially the strict restrictions on land supply after 2005, which has led to a very rapid rise in real estate prices. This in itself is due to the distortion of resource allocation caused by the administrative intervention market. But in the end, in order to reduce housing prices, the government has again used the administrative measures such as purchase restrictions to intervene in market demand. When the two methods are superimposed, the government conducts administrative intervention on both supply and demand, and the final result must be the overall shrinkage of the real estate industry. This has greatly weakened China's domestic demand and has led to an increase in structural imbalances. The key to solving the problem is that the government should change its role, reduce administrative interventions, and let the market adjust. In recent years, the progress of the reform has not been satisfactory. Reforms in some important areas such as resource price reform, reform of monopoly industries, reform of income distribution, reforms in the medical and education fields have been slow, and some areas have even experienced a retrogression in reforms. The tendency of executive dominance is further strengthened, and the combination of administrative power and monopoly interests hinders the advancement of reform and the fair sharing of reform benefits. On the one hand, social public opinion calls for speeding up reforms; on the other hand, it lacks confidence in reform. How to condense the consensus on reform and push the reform further into the depths is of great significance. Adjustments to the existing economic structure will inevitably face many obstacles. How should we choose the order, reduce the resistance, and speed up the pace? Cai Wei, director of the Institute of Population and Labor Economics of the Chinese Academy of Social Sciences, believes that reform should start from the “lowest place to pick the fruit†and start from the most easily changed place, while social reforms, such as household registration system reform, education reform, and social security system. Reforms, reform of the income distribution system, and changes in the way basic public services are provided are the most visible. John Brookings Institute of America? Kenneth Lieberthal, director of the Thornton China Research Center, believes that China needs major changes, and changes will inevitably cost. Under the current economic model, it is crucial to establish a new incentive system for local governments. Local governments, including provinces, cities, and counties, need to propose new incentives that do not use economic growth as the main indicator, such as encouraging service industry development, improving intellectual property protection, and implementing environmental laws. Some scholars have also suggested that the key to improving investment efficiency lies in opening up the market and introducing competition. Liu Shijin pointed out that the transformation of the mode of economic growth means that economic growth must be driven by low-cost factors and innovation. The focus is on the need to promote the flow of funds and other resources to innovation and industry, and to SMEs. To achieve this goal, it is a necessary precondition to relax access conditions. “Especially to relax the access of basic industries and services, encourage and strengthen competition in these areas, so that we can provide space for the Chinese economy to enter a new stage of growth and demand.†Cautious to deal with risks at home and abroad is another A priority. Since the beginning of this year, the US sovereign debt rating has been lowered, the European debt crisis has intensified, and the global capital market has been in a series of earthquakes. The financial risks of developed economies have risen sharply, but there is no room for monetary policy. Most countries are facing electoral pressures, the political situation is rigid, policy making is slower, and the economic outlook is worrisome. The weak prospects of advanced economies pose more challenges for emerging economies. In the face of the decline in exports, the risk of slowing economic growth, will economic restructuring induce more risks? In this regard, how will policy makers respond? In Liu Shijin's view, the Chinese economy will face the risk of a slowdown in external demand and a decline in export growth in the coming year, but endogenous risks should not be underestimated. In addition to the risk of localized financing and financing of local financing platforms, the sharp fluctuations in real estate prices and the slowdown in growth have caused the risk of overcapacity in some industries to be taken seriously. At present, the regulation of housing prices is still in the stalemate. Although the volume of trading in the housing market has gradually declined, the housing prices in some cities have begun to fall, but in the eyes of experts at the meeting, the regulation is far from over. "At least until the end of the year, the regulation will never quit." Nie Meisheng, president of the Real Estate Chamber of Commerce of the All-China Federation of Industry and Commerce, believes that for a long time, the macro-control of the real estate industry will not relax, in the next 6 months or 12 In the month, the real estate industry capital chain will be very tight. However, she does not believe that this round of regulation will break the big developer's capital chain. “The developer charging was still very good last year. There are some small developers who may have some problems, but the real estate industry mergers and acquisitions are obvious, like Vanke has merged many small developers.â€
Wang Tao, head of China's economic research at UBS Securities, believes that the government's regulation of real estate is not yet withdrawn, and a blast-up may occur once it exits. "If you withdraw now, the two-year regulation and control policy will fail." As for when the regulation and control policy is appropriate to withdraw, she believes that after the housing boom has passed, we will pay attention to the development of commercial housing. "If you do not change the low interest rate, do not accept the property tax, real estate regulation can not be cut into the fundamentals. The bubble will certainly appear, and finally the people have to pay the bill. The government can not be a new policy this year, next year is also a new policy, or to change the most basic things. Similar to the housing price bubble, in many endogenous risks, the solution to the problem of local financing platforms is also very urgent. Liu Yuhui, director of the Key Laboratory of Finance of the Chinese Academy of Social Sciences, believes that to resolve the local debt risk, the central government's long-term credit can be used to replace the short-term credit of the local government, that is, to solve the short-term risks of maturity mismatch. On this basis, we will consider a series of system constructions such as the local government debt governance model, and free up the necessary time and space for macroeconomic policies. Liu Yuhui believes that the recent policies have given the local financing platform some space, such as four cities to issue bonds independently. "But this is mainly for the issue of future increments, and there is no substantial help for the already existing debts that have exploded in the last two years." He believes that although the new policy of the China Banking Regulatory Commission allows platform debt to be renewed, such an extension has a limited effect on solving huge stock debts. At the time of the repayment period, the same problem will still be faced. Therefore, the long-term credit of the central government and the replacement of short-term credit by local governments are the most critical. Wang Zhihao, head of research at Standard Chartered Bank Greater China, said the central government should also support local government fiscal reforms to allow local governments to have more stable sources of revenue, such as property taxes. As for other measures, it is also possible to consider allowing large commercial banks, such as ICBC and CCB, to purchase small-scale municipal joint-stock banks. These small banks cannot be completely commercialized because of institutional problems. They have been interfered by local governments. If they are allowed to buy them by ICBC and CCB, they can help them avoid risks through the strong risk management system of the Bank. Jia Tingren, member of the Expert Committee of the National Development Bank, suggested that in addition to improving the fiscal and taxation system reform and budget management, establishing an early warning mechanism, regulating local government financing behavior, limiting the scale of financing, and preventing excessive debt are also important. In addition, legislation should also be adopted to regulate the behavior of local governments, and actively guide social funds to support urbanization.
Wang Tao, head of China's economic research at UBS Securities, believes that the government's regulation of real estate is not yet withdrawn, and a blast-up may occur once it exits. "If you withdraw now, the two-year regulation and control policy will fail." As for when the regulation and control policy is appropriate to withdraw, she believes that after the housing boom has passed, we will pay attention to the development of commercial housing. "If you do not change the low interest rate, do not accept the property tax, real estate regulation can not be cut into the fundamentals. The bubble will certainly appear, and finally the people have to pay the bill. The government can not be a new policy this year, next year is also a new policy, or to change the most basic things. Similar to the housing price bubble, in many endogenous risks, the solution to the problem of local financing platforms is also very urgent. Liu Yuhui, director of the Key Laboratory of Finance of the Chinese Academy of Social Sciences, believes that to resolve the local debt risk, the central government's long-term credit can be used to replace the short-term credit of the local government, that is, to solve the short-term risks of maturity mismatch. On this basis, we will consider a series of system constructions such as the local government debt governance model, and free up the necessary time and space for macroeconomic policies. Liu Yuhui believes that the recent policies have given the local financing platform some space, such as four cities to issue bonds independently. "But this is mainly for the issue of future increments, and there is no substantial help for the already existing debts that have exploded in the last two years." He believes that although the new policy of the China Banking Regulatory Commission allows platform debt to be renewed, such an extension has a limited effect on solving huge stock debts. At the time of the repayment period, the same problem will still be faced. Therefore, the long-term credit of the central government and the replacement of short-term credit by local governments are the most critical. Wang Zhihao, head of research at Standard Chartered Bank Greater China, said the central government should also support local government fiscal reforms to allow local governments to have more stable sources of revenue, such as property taxes. As for other measures, it is also possible to consider allowing large commercial banks, such as ICBC and CCB, to purchase small-scale municipal joint-stock banks. These small banks cannot be completely commercialized because of institutional problems. They have been interfered by local governments. If they are allowed to buy them by ICBC and CCB, they can help them avoid risks through the strong risk management system of the Bank. Jia Tingren, member of the Expert Committee of the National Development Bank, suggested that in addition to improving the fiscal and taxation system reform and budget management, establishing an early warning mechanism, regulating local government financing behavior, limiting the scale of financing, and preventing excessive debt are also important. In addition, legislation should also be adopted to regulate the behavior of local governments, and actively guide social funds to support urbanization.
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