China Is In A Period Of Strategic Opportunities And No Longer Avoids Risks.

In November 9th, President Xi Jinping made the first comprehensive exposition and interpretation of China's new economic normal in the keynote speech at the opening ceremony of the APEC business leaders summit.

It is pointed out that the key to China's ability to seize new opportunities and deal with all kinds of challenges and risks under the new normal lies in the overall deepening of reform.

This is the first time in May of this year when Xi Jinping visited Henan to put forward the concept of "new normal". After six months, the high-level interpretation of the new normal has been fully understood. It is of great significance for all sectors to correctly understand and grasp the connotation of the new normal, and the opportunities and challenges faced by the Chinese economy under the new normal and how to deal with them strategically.

It should be pointed out that the new generation of leaders should define China's economy in the "new normal", and prudently choose China's macro policy in accordance with the "new normal" strategy. It is by no means simply making new policy vocabulary, but a strategic thinking and decision on China's economy entering a new stage after more than 30 years of reform and opening up.

In recent years, especially after China's economy surpassed Japan as the world's second largest economy in 2010, China's economic growth has continued to decline. The contradictions and risks accumulated over the past 30 years of rapid growth have been gradually highlighted.

However, whether China's economic downturn, risk highlights and dividend conversion are affected by external factors means that China's economy has entered a new and different stage, and there is great controversy and divergence among the various sectors.

This divergence is not just the dividing line of theory, but more importantly, the guidance of macroscopical policy is totally different. If we think that China's economic slowdown is caused by external factors, it means that the current economic growth is lower than the potential growth rate and the stimulus policy can be bigger. If China's economic slowdown is an internal factor, it means that China's economic slowdown is due to a decline in the potential growth rate, while macroeconomic policy must restrain and tolerate economic slowdown, and is determined to solve the problems faced by China's sustained economic growth through reform.

Under such circumstances, Xi Jinping stood at the angle of the highest decision-makers, described the characteristics of the Chinese economy with the "new normal", and raised it to the height of China's macro strategy. At the same time, he made a strategic choice for the direction of China's "next ten years" policy while resolving disputes.

However, in May this year, when President Xi Jinping put forward the concept of "new normal", there was no new economic normality in China. What are the characteristics of the Chinese economy under the new normal? What opportunities and challenges will China face in the new stage of development?

At that time, Xi Jinping simply put forward that we should "start from the phased characteristics of China's current economic development, adapt to the new normal and maintain a normal sense of strategy".

The interpretation and understanding of the "new normal" is also very different from all walks of life.

Based on this, Xi Jinping chose to make a comprehensive exposition of the new normal in the International Conference of the APEC conference, set the tone for the new normal, and make a comprehensive interpretation of China's macro policies and responses under the new normal. On the one hand, it is conducive to "setting points and stopping disputes" and eliminating all kinds of differences. On the other hand, it also helps the international community to fully understand China's future macro policies.

First of all, Xi Jinping expounded the three characteristics of China's economy in the new normal, which are different from the past thirty years: first, from high-speed growth to medium and high speed growth; two, the continuous optimization and upgrading of the economic structure; the third industry consumption demand has gradually become the main body; the gap between urban and rural areas has gradually shrunk; the proportion of residents' income has increased; the achievement of development has benefited more people; three is from factor driven, investment driven to innovation driven.

These three characteristics are a system with inherent unified logic.

After more than 30 years of rapid growth, China's economic fundamentals, the basic mode of economic development, the industrial format and the driving force of economic growth are no longer the same.

China's economy grew from a small economy more than 30 years ago to the second largest economy in the world. From a shortage economy to a surplus economy, from a small industrial country to the world's largest manufacturing country, from a food and clothing economy to a well-to-do economy, this series of changes means that the fundamentals of China's economy have not only undergone tremendous changes, but also made a qualitative leap. Looking at the Chinese economy in the past, thinking about the Chinese economy in the past thinking is neither accurate nor realistic.

In terms of economic speed, after experiencing more than 30 years of rapid growth, China's economy has officially bid farewell to high speed growth and entered the stage of "normal growth". The economic growth rate will be below 8% and over 7%.

In the first 3 quarters of the Chinese economy, 7.4% of the speed, because many people can not accurately grasp the trend of China's economic slowdown in the new normal, we assume that the growth rate of 7.4% is a very poor speed. We believe that we should stimulate the economy to return to the high speed track above 8%.

This high-speed dependence is precisely due to the lack of awareness of the great changes in China's economy.

As Xi Jinping pointed out in his speech, "the economic growth of China in 2013 is equivalent to the total economic output in 1994, which can be ranked seventeenth in the world.

Even about 7% growth, both speed and volume, is among the best in the world.

Secondly, Xi Jinping expounded the new opportunities facing China's economy under the new normal, which is the key to understand the new normal situation of China's economy.

For many people, since China's economy is going to slow down, this means that the new normal is more of a challenge than an opportunity for China's economy.

In fact, when Xi Jinping first put forward the new normal in May, the first thing to be clear is that China is still in an important period of strategic opportunities.

The new normal means only that the Chinese economy has entered a new stage of development. It only means that the speed should go to the next stage, rather than that the golden age of China's development is over.

In fact, if China's economy successfully completes the pformation of growth driving force, the growth rate will decline, but the quality of economic growth and the total gold content of the economy will be higher than that of the past 30 years.

Xi Jinping pointed out that under the new normal, "China's economic growth is more stable and its growth momentum is more diversified."

For example, in terms of industrial format, in the face of overcapacity in manufacturing industry, China can vigorously develop the service industry in the future to make up for the short board of the service industry; in the face of the decline of external demand after China has become the world's largest cargo trading country, China can expand domestic demand through various measures, and it is now changing from investment to domestic demand.

This effort has already begun to bear fruit. If we persist in our efforts, we will not be eager for quick success and instant benefit. In 10 years or so, both domestic demand and service industry will become the strong internal engine of China's economy.

Third, it is clear that deepening reform is the key to resolving the new problems and new contradictions facing the Chinese economy under the new normal.

It should be acknowledged that, from the high speed growth of the past to the new normal today, the Chinese economy itself has changed into "another track", and the customer will appear "car sickness" and all kinds of "non adaptation" which is normal.

How to understand this kind of risk, how to change thinking, adapt to the new normal and maintain a normal mind is indeed crucial.

For example, in the face of the decline of China's economy, many people are accustomed to the inertial thinking stimulated by the past slide.

Under the new normal, the biggest risk of China's economy is not the decline of growth rate. It is not adapted to such a decline and is not allowed to slide.

such

There are at least five: first, to stimulate dependence.

And drug addiction is a reason that can not accept the natural adjustment of each economy, the growth rate will decline "zero tolerance", unable to get out of a fall stimulus, a stimulus will be effective, the stimulus has gone down and "cyclical law"; the two is the risk of no reform.

Although the third plenary session has established a grand reform plan, whether the confidence of the people in China's future will be restored depends on the executive force of the reform.

At present, poor investment, private entrepreneurs are still hesitant, the key is still not see the strong push for reform, which is the main reason for the economic downturn; the three is the overstimulation caused by the past stimulus policy and corporate debt; four, the risk brought by the overall adjustment of real estate.

Facing these risks, it is to continue to bring good data to people's stimulation, or to make up their minds to lead China's economy through rapids and dangerous lands through reform and innovation. This is a choice for China's economic future and destiny.

In his speech, Xi Jinping once again stressed the importance of "dares to bite the bones, dare to risk the beach, and dare to operate on the stubborn disease that has accumulated for many years".

And the determination of innovation to overcome risks.

Xi Jinping affirmed the key role of deepening reform in the new normal of China's economy, affirmed the important value of the market and entrepreneurs, and affirmed the great significance of innovation for China's economic pformation.

Pointed out: "if innovation is the new engine of China's development, then reform is the essential ignitor."

Such a statement is undoubtedly a warning sign for those who call for stimulus in the face of China's economic downturn.

The author believes that, in the medium and long term cycle, China's economy will not expect the collapse of overseas investment banks, but a series of systemic risks of China's economy may erupt at any time.

These risks are largely due to repeated delays in the past and improper incentives.

It is all about weakness and bad health.

The solution to these risks is not to attack the poison with poison, but to adopt the stimulus policy again. Instead, it is determined to give up the stimulus and return to the right path of reform.

I always insist that

China is still in the most precious period of strategic opportunities.

The next thirty years will still be the thirty year of China's gold development. China's growth mode will be more reasonable, the international competitiveness of the industry will be greatly improved, the happiness of economic development will be more inclusive, and the impact of China's economy on the world will be more profound and comprehensive.

But whether this opportunity can be realized depends on whether we can profoundly understand the new normal of China's economy, keep tolerance for economic slowdown, and avoid evading and delaying the risks in adjustment.

For China's economy, the key to adapting to the new normal is to pform our thinking, grasp new historical opportunities and meet new challenges.

More directly, whether we can make up our mind, deepen reform, scrape the bone and cure poison, really realize the comprehensive pformation of government functions and modernization of state governance capability, will truly become a country with great innovation ability.