Zhang Zhuoyuan: Changing The Mode Of Economic Development Takes Time.

Interview with famous economist, honorary president of Sun Ye Fang foundation, and Zhang Zhuoyuan, member of the Chinese Academy of Social Sciences

People pay more attention to pork prices, and more concerned about why Hainan bananas are 2 cents per catty and spanported to Beijing's fair market, which has risen to 2.5 yuan per catty. Whether it is food and clothing, or a depreciating ticket and a non rising stock market, it has triggered the concern of investors as a consumer group to the macroeconomic trend and inflation trend of the country. We are worried that it is difficult to control both inflation and growth.

Zhang Zhuoyuan, active in the field of economics in China. Evergreen tree, It is considered that the economic growth rate will be maintained for about 10 years in the future 7% to 8%, and the CPI rise may continue for some time before the economy can develop to a more balanced situation, because changing the mode of economic development takes time.

Inflation is rooted in excess liquidity.

Shanghai Securities News: in June 26th this year, Premier Wen Jiabao of the State Council said in London that it would be difficult to maintain inflation below 4% this year, but it should be controlled below 5%. This means that the annual growth of CPI in the government work report at the beginning of the year is expected to rise to 5% in the year of 4%. Why should the central government make such adjustments?

Zhang Zhuoyuan: in 2011, the overall price rise rate was controlled at around 4%. CPI rose 5.4% in the first half of 2011. Among them, the new price increase factor reached nearly 3 percentage points. According to the experts of the national development and Reform Commission's Macroeconomic Research Institute, the year-end year-end 2011 factor was 2.67 percentage points. This means that starting from May, even if no new price increases are added, the annual CPI rate will reach nearly 5%.

From the view of the trend of commodities, the price of commodities in the international market is still high this year, and the price of crude oil remains at nearly $100 / barrel, and the price of grain is high. Because of the abnormal climate in China, the expectations of grain price increase are also strong. The prices of pork and eggs have been kept two digit growth recently. The price increases of water, electricity and natural gas are not small, including commodity prices in the lower reaches. In short, the pressure of price rise is not small so far this year.

CPI is too high will affect social stability, the government will do everything possible to introduce relevant policies to curb, for example, increase the intensity of financial subsidies or administrative intervention, etc., the annual CPI control is around 5%, the problem is not big.

　　 Shanghai Securities Daily At present, there are different views on the reasons for the new round of inflation in China. Do you think inflation is caused by internal factors or external input, or internal and external forces?

Zhang Zhuoyuan: now it seems that the starting point of the so-called new round of inflation in China is in July 2010, when CPI exceeded 3% in that month. It should be said that inflation and price rise are mainly not imported, but after the global financial crisis, in order to offset the impact of the crisis on China's economy, a large number of fixed asset investment growth is too fast, and excessive credit is caused by excessive monetary and liquidity.

Not long ago, the National Bureau of Statistics announced that the impact of rising global oil prices, grain prices and resource prices on China's consumer prices is expected to be between 30% and 40%. This shows that China's new round of inflation is mainly not imported. Objectively speaking, the massive increase in commodity prices in the international market in recent years is, to a certain extent, related to the extensive expansion and overdemand of our country over the years, pushing up the price rise of crude oil, iron ore, copper and vegetable oil. Of course, the rapid rise of other emerging countries is also one of the main reasons for the rise in international commodity prices.

From the point of view of money supply, from 2003 to 2010, the scale of RMB loans increased by 32 trillion yuan in seven years, and three times in 2003 in 2010. M2 increased by 1.85 times in the six years from 2004 to 2010, and the average annual growth rate of M1 was close to 19%. The annual growth rate of M2 and M1 exceeded the annual GDP growth rate and CPI rate. In the past six years, the growth rate of GDP was 11%, the growth rate of CPI was 2.9%, the sum of two items was 13.9%, the average growth rate of M1 and M2 was 19%, and the gap was 5 points, which resulted in excessive liquidity. This is the root cause of inflation's rise and fall.

Shanghai Securities News: this round Inflation persisting How long will it take?

Zhang Zhuoyuan: because this round of inflation is the result of the excessive supply of money for a long period of time. It is also the result of the accumulation of the increase in product costs, and is also affected by the rise in commodity prices in the international market. This inflation will continue for some time. It is estimated that CPI rise by 4% - 6% may last two or three years before the economy can return to a more balanced state.

GDP growth is expected to be 9.2% - 9.5% this year.

Shanghai Securities Journal: some people worry that under inflation pressure, the economic growth rate in the second half of this year will obviously slow down. Although the Statistics Bureau said that GDP grew by 9.6% in the first half of the year, it is expected that the annual GDP trend will be higher and lower, with annual growth of less than 9% or even lower. What do you think of it?

Zhang Zhuoyuan: this year is the beginning of 12th Five-Year, and the momentum of all parts of the country is still very strong.

In the first quarter of this year, from the growth rate of GDP announced by the provinces, apart from Beijing 8.6% and Hainan 10%, the remaining more than 10 provinces were over 10%, or showed a certain overheated state. Since the second quarter, industrial growth has declined due to insufficient electricity supply. However, in the first half of the year, the added value of above scale industries increased by 14.3% over the same period last year, and maintained a fairly high growth trend.

The main economic indicators remained stable and relatively fast growth, GDP from the three quarter of last year 9.6% to fourth quarter 9.8% to 9.7% in the first quarter of this year and 9.5% in the two quarter. From this situation, the economic growth in the four consecutive quarters has basically stabilized between 9.5% and 9.8%. Compared with the development goals set by the 12th Five-Year plan, and from all levels of the world, this growth rate is not low or even high. In the first half of this year, the growth rate of fixed assets investment was 25.6%. Since the second half of last year, the growth rate of fixed asset investment has been stable around 25% in the four consecutive quarters. The total retail sales of social consumption grew by an average of 16.8% in the first half of the year, and 17% in the four quarter.

In addition, the central and western regions have strong economic development. From the perspective of fixed assets investment, the investment in the eastern region increased by 22.6%, the central region increased by 31%, and the western region increased by 29.2%.

However, in the second half of the year, stimulus policies were gradually withdrawn and structural adjustment deepened, and some major economic indicators appeared in the latter two quarters, but the result was mainly the result of active regulation.

GDP growth is expected to be 9.2% to 9.5% throughout the year.

Shanghai Securities Daily: in the second half of the year, the macroeconomic growth rate must be maintained. Where is the supporting point?

Zhang Zhuoyuan: affordable housing and water conservancy construction should be an important fulcrum for maintaining steady economic growth.

In the first half of this year, investment in real estate development increased by 32.9% over the same period last year. Affected by the tightening of real estate control policies, the construction of affordable housing has been increasing this year, and capital investment is also increasing. The main problem that plagued the construction of affordable housing is the timely follow-up of matching funds. In order to better reflect the construction process of affordable housing, including the input of funds, the National Bureau of statistics and relevant ministries and commissions recently issued a circular calling for the establishment of a statistical investigation system for affordable housing from this month.

Water conservancy construction is another important project. Following the first issue of water conservancy document issued in January 29th this year, the first water conservancy working conference held in the name of the Central Committee since the founding of new China was held in from July 8th to 9th. In the first half of this year, China's natural disasters were frequent, which once again highlighted the importance of water conservancy construction. Coupled with many years of outdated facilities, it is urgent to refurbish. If 10% of the proceeds from the land spanfer can be used for water conservancy construction, 60 billion yuan to 80 billion yuan will be used for irrigation and water conservancy construction according to the total amount of land spanfer income in the previous year.

Stable and coordinated development in the next five years

Shanghai Securities Daily: there is a view that China's economy is likely to decline in the next 2 to 3 years. Overseas hedge funds and portfolio managers are looking for relatively inexpensive insurance tools to guard against the risk of a wider crisis caused by China's economic slowdown or local government debt problems. In addition to shorting bank H-shares, there are sovereign credit default swaps (CDS) and Renminbi put options. What do you think of China's economic development in the next few years?

Zhang Zhuoyuan: I believe that under the guidance of the national "12th Five-Year plan", we will fully implement the guidelines and tasks put forward by the Central Committee. In the next five years, China's economy will be stable, coordinated and well developed.

Of course, it is undeniable that China's economy is facing several imbalances at the present stage. It is urgent to adjust during the "12th Five-Year" period, and coordinate the main proportions of the national economy. First, the imbalance between savings and consumption or investment and consumption; two, economic growth depends too heavily on the secondary industry; the three is the excessive cost of resources and environment for economic growth; four, the overall deterioration of the environment and environment has not been reversed; and five, the income gap of residents is too large. Efforts to alleviate these major imbalances and achieve economic rebalancing are the key to promoting the long-term and stable development of China's economy, as well as the main content of changing the mode of economic development and adjusting the economic structure.

Under the guidance of the central "12th Five-Year plan", the main characteristics of China's economic trend in the next five years will be stable and coordinated development.

The first is stable development. During the "12th Five-Year" period, it is necessary to gradually alleviate the abnormal growth of the economy since 2003 (the average annual growth rate of GDP in the first four years of 11th Five-Year) reached 11.4%. It broke through the generally recognized potential growth rate (9% or so) in successive years, resulting in the imbalance of resources and environment, unbalanced industrial structure, lagging behind in social construction, and widening the income gap between residents. China's economy is faced with the historic task of changing from quantity expansion to quality and efficiency. It needs to spanform the mode of economic development, readjust the economic structure and reform the distribution system so as to achieve sound and rapid development. This calls for the restoration of macroeconomic stability and balance, and no longer a vigorous pursuit of GDP's short-term high speed growth, and an appropriate slowdown in economic growth to around 8%, so as to make efforts to spanform the way and structure to achieve sustainable growth in a normal manner. Now, monetary policy has returned to sound, and the relaxed fiscal policy seems to return to neutral after some time, so as to facilitate the steady growth of the economy.

Second is coordinated development. The "12th Five-Year plan" is based on scientific development as the main theme and accelerating spanformation of economic development mode as the main line. To speed up the spanformation of the mode of economic development, we must adhere to the strategic adjustment of the economic structure as the main direction of attack, and gradually adjust the imbalance in economic development.

It is worth noting that the GDP data should be taken into account objectively. We should not pursue the short-term high speed growth of GDP, appropriately slow down the economic growth to about 8%, and restore the normal and sustainable growth trend of macroeconomic stability and balanced development. The economic growth rate will be maintained for about 10 years in the next 7% to 8% years.

Changing the mode of economic development takes time.

Shanghai Securities Daily: in recent years, the government has been emphasizing the spanformation of the mode of economic development. But once the economy is warm, the backward production enterprises that are to be eliminated are always the first ones to run into the "beneficiary area". Is it difficult to spanform the way of economic growth?

Zhang Zhuoyuan: changing the mode of economic development is the fundamental issue that determines whether China's economy can develop in a long-term and healthy way. The emergence and development of the international financial crisis has made our task of changing the mode of economic development more and more urgent.

For a long time, China's economic development has been too dependent on foreign markets and domestic investment, and is too dependent on material consumption. This makes our country deeply involved in the international division of labor system, and its negative effects are increasingly apparent: China's low-end processing industry is highly dependent on exports, the investment and high technology products lack of innovation and upgrading capability, and is heavily dependent on imports, thus occupying the market space and development opportunities of similar industries in China, and exacerbating the imbalance of domestic economic structure and distribution structure. Whether the spanformation of development mode is in place or not will not only affect the short-term performance of the macro-economy, but also affect the competitiveness and influence of our economy in the world.

To spanform the mode of economic development, the most important task is to start from improving the performance appraisal mechanism, no longer talk about heroes in terms of short-term GDP growth, and solve the basic problems from the system. The key point is to accelerate the optimization and upgrading of industrial structure and enhance the capability of independent innovation. Excessive dependence on external economy can not fundamentally change China's backward industrial structure, backward technology and independent innovation capability. Under the firm leadership of the party and the government, we must stand independently at the height of the national development strategy and accomplish the strategic task of changing the mode of economic development.

In the past, the pursuit of quantity expansion has been driven more by investment and increased investment by increasing investment rate. Now we should turn more attention to people's livelihood, rationally adjust investment and consumption structure, and increase the pulling effect of household consumption on economic growth. Therefore, the expansion of domestic demand is mainly to expand consumer demand, especially the consumption demand of residents. The proportion of Chinese consumption in GDP is too low, which is abnormal. To increase the proportion of consumption, we must first allocate the distribution structure, increase the income of residents, especially the income of low-income residents, because they can not consume without income. Another point of adjusting the structure is to speed up the development of the third industry, develop the service industry, develop low carbon economy and green economy.

In short, the spanformation of the mode of economic development can not be accomplished by 3 to 5 years' efforts. No 8 to 10 years will not be possible. Therefore, it is a long-term task to spanfer the structure to adjust the structure.