Hu Yuexiao: How To Solve The Puzzle Of Overcapacity In China?

< p > < < a href= > http://sjfzxm.com/news/index_c.asp > > the central economic work conference < /a > recently pointed out that the risks and challenges facing China's economic operation in the future will be manifested by the contradiction between the downward pressure of economic growth and the relative surplus of production capacity. The corresponding solution is to speed up the adjustment of industrial structure, and the key is to deepen the strategic adjustment of industrial structure.

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At the same time, the meeting clearly pointed out that resolving the overcapacity contradiction is the focal point of the industrial structure adjustment, and the strategy is to "utilize the forced mechanism of the international financial crisis" P.

The author believes that if the financial crisis can not force further financial reform, especially in the diversification of financial market, the economic layout and industrial planning of the whole country will also help to solve the problem of overcapacity.

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< p > < strong > Chinese enterprises' "enclosure complex" and overcapacity < /strong > < /p >

< p > excessive inventory and overcapacity are the main manifestations of the current downturn in the enterprise level. The former can be automatically eliminated in the short run, while the latter will not automatically eliminate and affect the long term, thus becoming the main contradiction for the current Chinese economy to get out of the predicament.

In 2011, after understanding that the excessive expansion of anti crisis stimulus was not sustainable, China's economy entered the re stocking process after replenishment, and the problem of excess capacity once again became a prominent phenomenon in the economic operation.

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< p > in order to reduce the adverse impact of "a href=" http://sjfzxm.com/news/index_s.asp "> inventory < /a > and" go to capacity "behavior, the countermeasures to promote domestic demand and pform the mode of economic growth were put forward.

This situation shows that the deep-seated contradictions in current China's economic operation are not simply economic cycles.

The problem of economic cycle usually can only be solved through the combination of appropriate monetary and fiscal policies, and the problem of overcapacity and high inventory in China is the result of counter cyclical policy.

According to the rough division of "ten years and one cycle" since reform and opening up, the long-term prosperity of China's economy in the past third economic cycles is not the only reason that Chinese enterprises are keen on "horse race".

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< p > < enclosure > < a href= > http://sjfzxm.com/news/index_cj.as > financing > /a > listing. It is a general mode for Chinese enterprises to grow in the past as soon as possible.

The common practice and growth mode of Chinese enterprises in the past has led to the strong "enclosure complex" of Chinese enterprises and the impulse to expand production capacity as soon as possible.

This situation has directly led to the plight of China's current economic overcapacity.

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< p > < strong > three factors lead to overcapacity. < /strong > < /p >

< p > I believe that the "enclosure complex" that Chinese enterprises have existed in the past is the product of the following three factors.

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< p > 1. the need to increase market share in the economic rise cycle.

Whether it is the rapid expansion of the external demand market and the expansion of the domestic market brought about by the rapid development of urbanization in China, the increase of the total economic scale at the macro level will always bring about the expansion of the enterprise market at the micro level. In the fast rising cycle of the economy, the constantly increasing market demand has built up the foundation for the enterprise to expand.

In spite of fierce competition among enterprises, most enterprises can find their own market space through market segmentation.

Whoever can grow bigger than others can have a larger market share.

In order to meet the rapid expansion of customer demand, rapid upgrading of capacity is the main task of the enterprise in this period.

Under the guidance of a bigger scale, raising market share through price war is an effective way for enterprises to expand their production smoothly, and product innovation is a thankless task.

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< p > 2.. Liquidity expansion period preempting asset price rise.

From 2000 to the beginning of the new century, to the 2007 of the crisis, China's stock of money rose from 13 trillion and 800 billion to 40 trillion and 300 billion, and nearly 3 times in 7 years. The crisis also gave the currency expansion to exceed the conventional thrust. By 2011, China's stock of money has increased 1 times to 85 trillion and 200 billion yuan.

Nominal GDP in the same period, in 2000, was 10 trillion yuan in nominal GDP in China, 26 trillion and 600 billion in 2007 and 47 trillion and 300 billion in 2011.

In the past 2000-2007 Years, money has not gone beyond GDP growth, but after 2008, the growth rate of money and GDP has been clearly opened. This means that a large number of ultra developed currencies have entered the asset field.

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< p > money exceeds GDP growth. We call it the deepening of monetary deepening.

By combining longitudinal historical comparison and horizontal international comparison, China's currency deepening is obviously too fast.

China's currency deepening process failed to maintain the stability of assets and commodity prices, and asset bubbles and inflation were accompanied by it.

In China, excessive monetary deepening has led to the rise of asset bubbles, which shows that the prices of investment goods outweigh the growth of production prices over the long term.

Judging from the recent 10 years, the price index of fixed assets investment exceeds the same price index of consumer goods and industrial products in the same period.

This situation directly led to the phenomenon of early investment, more investment than late investment, and less investment and more benefits.

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Under the indirect financing system of P > 3., the credit convenience of banks is enhanced.

Under the indirect financing system dominated by banks, credit allocation is a perpetuation phenomenon in the field of bank credit under the influence of information asymmetry and reverse incentive.

In the credit rationing, banks naturally prefer large projects and assets backed projects.

In China's banking system dominated by big banks, the "quality of flow" caused by credit allocation actually flows to large enterprises and large projects, that is, the tendency of credit resources to concentrate on large enterprises.

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< p > therefore, the more quickly the enterprise can scale up, the more it can enhance the attractiveness of banks and enhance the bargaining position of enterprises in financing.

With the establishment and perfection of China's industrial economic system and the rapid expansion of decades, the economic growth in the future will enter the stage of structural adjustment.

This change at the macro level has also had an important impact on enterprises at the micro level.

More and more enterprises feel and realize that the future growth will be more towards mergers and reorganization. The future competition will not only take place in the product market, but also the market competition will expand to the equity market of enterprises, and the competition in the ownership market will become more and more intense.

The larger the scale of enterprises is, the stronger the financing ability of enterprises will be in the indirect financing system dominated by large and medium-sized banks, and the more they will be invincible in the overall competition of products and ownership.

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< p > < strong > eliminating the overcapacity of Chinese enterprises by financial reform < /strong > < /p >

< p > structural adjustment and industrial upgrading and capacity compression are actually different versions of the same event.

Industrial upgrading is the content of economic structural adjustment, and there is no surplus capacity to achieve industrial upgrading.

From the reasons for overcapacity in China, we can not automatically eliminate excess capacity by lengthening the economic downturn.

China's current excess capacity is by no means a single business cycle, that is, excess capacity is non cyclical.

From the traditional steel, cement and other infrastructure industries to the photovoltaic industry and other high-tech industries, which represent the direction of future emerging industries, China's overcapacity is universal and all-round.

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< p > in the iron and steel industry, the more high-end plate area, the more serious the excess capacity. In the lower end of the wire field, the overcapacity is not very serious, or even not.

The solution to China's excess capacity is not to use the traditional idea of counter cyclical economic cycle, that is, the expansion policy of aggregate demand. Structural adjustment is not necessarily effective. Overcapacity in emerging industries and traditional industries is also a "heavy disaster area", so the idea of industrial upgrading does not necessarily play a role in the problem of surplus production capacity.

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< p > Finance is the core of the economy, and financial factors are also one of the important factors leading to overcapacity in China.

Deepening reform in the financial field is a feasible and effective way to solve the problem of overcapacity in China.

From the high end to the low end, the phenomenon of overcapacity in Chinese enterprises shows that finance is a more important factor than the economic cycle and industrial structure, and it is the "enclosure complex" that causes Chinese enterprises to expand their capacity.

Under the existing economic and financial structure in China, the business orientation of enterprises is not the pursuit of the best scale and product innovation, but the pursuit of the largest scale.

Therefore, the reform of the existing financial system is a fundamental solution to the overcapacity of Chinese enterprises.

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< p > first, we must develop financing methods.

Although the mode of financing innovation in capital market has been emerging in recent years, especially the private debt, SME debt and other suitable forms of financing for SMEs, it has opened up new financing channels for small and medium-sized enterprises.

But on the whole, the bank oriented indirect financing mode has not been broken. In the future, it needs to expand the existing multiple bond financing modes on the scale, and still need to strengthen the innovation and development of various direct financing models suitable for the development of small and medium enterprises in different industries.

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< p > secondly, we need to accelerate the pformation of the commercial banking system dominated by large and medium-sized banks.

Although we have introduced small and new financial institutions such as village banks and small and medium loan companies, their development has not yet reached a climate and is far from meeting the needs of economic development.

The regulatory authorities still set up higher gate and more business restrictions on the establishment of small and micro financial institutions.

In the future, we need to reduce the threshold and speed up the development of small and medium-sized financial institutions. For example, we should increase the intensity of the pilot projects on the basis of the existing 3 gold reform pilot areas, set up more gold reform pilot areas, and conduct more diversified experiments, so that community banks and village banks will become the most numerous banking outlets throughout China's urban and rural areas.

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