"New 36": Private Capital Participation In 4 Trillion Stimulus Plan

When market funds fall into the "European debt fog", the policy has sounded the bugle of the new journey.

Yesterday (May 13th), the State Council issued the "opinions on encouraging and guiding the healthy development of private investment" (hereinafter referred to as the "new 36"). On the same day, the capital market responded positively, and the Shanghai Composite Index closed up 2.06%.

"This document is very timely, and I hope that private capital will be carefully considered to find new industrial opportunities." Li Deshui, deputy director of the CPPCC National Economic Commission and the former director of the National Bureau of national statistics, told the daily economic news reporter.

At present, China is carrying out a profound economic structural adjustment. The most profound part is the investment structure. In other words, the state should further promote the coordinated development of state-owned economy and private economy.

After the 36 item in 2005, why are we making "new 36" now? Industry experts believe that in 2010, the "new 36 item" will be introduced, and its strategic significance will permeate the whole "12th Five-Year" plan rather than solve the urgency at once.

Economic recovery, private capital "take over"

Li Deshui believes that China's macroeconomic situation is extremely complex this year. On the one hand, structural imbalance is the root cause of China's sustained economic growth. On the other hand, the government's stimulus package needs to be withdrawn sooner or later.

Combing the response measures since the outbreak of the financial crisis, it is easy to find the skeleton of the investment policy of the state: first, the "4 trillion" stimulus plan was introduced in November 2008, then the local government financing platform was launched to expand the infrastructure construction of transportation, electricity and railways.

With these investments fulfilled, China's economy has been the first to recover from the global crisis. But the new problem that comes with it is that if we invest more in the national level this year, the risks will be great and the national finance will be difficult to bear.

Bao Yujun, former vice chairman of the China Federation of industry and commerce, pointed out that the shadow of the European debt crisis is spreading to the whole world. Its essence is the bankruptcy of state finance. But this situation will not happen in our country, because large state-owned enterprises have been through the difficulties under the support of the central policy. The data of the SASAC show that the profit margin of the central enterprises has remained great since last year.

After solving the state-owned economy, we need to use policies to guide private investment into the real economy. If this path is opened, new capital blood will be injected into the economic development. "This also means that China's economy has gained new development momentum in the two aspects of state-owned economy and private economy." Bao Yujun said.

Private capital has always been "not bad money", only in the Zhejiang area has long been active in the market of private capital of more than 1 trillion yuan. When the central government increases investment in state-owned enterprises, they are caught in the internal and external attacks of "blocked exports and domestic investment". Statistics show that in 2009, China's investment grew by 31%, its investment in Chinese enterprises increased by 40%~50%, and private investment increased by only 27%.

Because of the complex investment environment, the industry once complained of "going back to the country". Then, how will the growth rate of private capital increase in the future? Li Deshui believed that we should first support policies and guide private capital to find investment breakthroughs in industrial policies.

Private capital is not a "vulnerable group".

In the process of coping with the global financial crisis, a strange phenomenon has appeared in our country, that is, private capital in Zhejiang can't find investment export.

"In order to resist the impact of the financial crisis, the state quickly launched the" 1, 4 trillion "stimulus policy, with huge investment from the government, which led to the marginalization of private capital. A director of the SASAC's Bureau told the daily economic news that due to the huge investment of the state led 4 trillion, the illusion of private capital was weakened. This asymmetry in investment directly led to the question of "entering the country and moving back" in the second half of 2009.

"In essence, it is not that state-owned capital is crowding out private capital, but it is 1; 4 trillion" before the implementation of the economic stimulus policy, it stimulates private investment 1, and the new 36 comes out later. The SASAC explained.

In his view, the state first used state capital to resist the global crisis, and then guided private capital to stimulate economic recovery. "This is a kind of hard work, and now the overall situation is clear."

He believes that starting private investment in the new round of economic growth is the best and most appropriate investment policy. "At present, we are catching up with real estate regulation and control, and a lot of funds are left idle. Therefore, we must now find an outlet for private capital in China.

With the implementation of the "new 36 item", private capital will not be the "vulnerable group" that the industry is worried about under the escort of the national policy.

"As the two core components of the national economy, private capital is not in conflict with state capital, nor is it a vicious competition either." The SASAC said.

This also shows that the State encourages the practical significance of the introduction of private investment policies, aiming at giving public funds a vent and making private capital a booster for China's new round of economic growth.

According to "daily economic news" reporter, encouraging and guiding private investment is a systematic project, not only to liberate industrial control, but also to create equal competition rules. The new 36 article also stipulates that "market access standards and preferential support policies should be open and transparent, treat all kinds of investment entities equally, and not impose additional conditions on private capital."

With the implementation of the policy, a series of supporting policies will be introduced in succession. The relevant ministries and commissions of the NDRC, the Ministry of industry and commerce, the Banking Regulatory Commission and the SFC will further introduce supporting measures to support the public funds.

Breaking the "holding Convention" of state owned assets

Careful reading of the "new 36 articles" reveals that the most operational terms are to break the "holding Convention" of state capital.

"The new 36 article" clearly pointed out that "encourage and guide private enterprises to participate in the restructuring and reorganization of state-owned enterprises through equity participation, holding, asset acquisition and other forms, and rationally reduce the proportion of state-owned capital in state holding enterprises."

This is the first time that the State Council has put forward policies and regulations, allowing private capital to hold state owned enterprises in the process of restructuring, or to participate in the restructuring of state-owned enterprises in a larger proportion.

"In recent years, the restructuring of state-owned enterprises has been very strict in the ownership structure, and once the shareholding power is involved, reorganization has almost no chance of success." An industrial investment fund general manager told the daily economic news reporter.

According to the fund, even if the negotiations between the two sides are successful, the SASAC will not release it on approval because of the transfer of the controlling rights. This rigid rule has caused a large number of private capital to lose the chance to participate in the reform of state-owned enterprises in a few years.

However, the new 36 article also points out that "in the process of restructuring and restructuring of state-owned enterprises, private enterprises should conscientiously implement the policy requirements of the State concerning asset disposal, debt processing and social security, and properly place workers in accordance with the law, so as to ensure the legitimate rights and interests of employees."

This regulation will exert great influence on private enterprises. "Because it is difficult for private enterprises to accept and arrange employees in state-owned enterprises, the negotiation of staff resettlement is far more difficult than capital investment." The above industry fund general manager said.

However, this can only be resolved by negotiations by the enterprise itself, and the state policy will not be specifically interfered.