The reason why the Central Economic Work Conference has attracted the attention of all parties is that it has set the tone for China's overall economic work next year. It can be foreseen that this year's Central Economic Work Conference, the introduction of the "policy tightening signal" is no longer expected, next year, the implementation of active fiscal policies and moderately loose monetary policy is no suspense, stability will still be the general direction.
According to relevant media reports, the central government continued to set the expected target for economic growth next year at 8%, and overall macroeconomic policies continue to remain loose. What is different from this year is that next year's proactive fiscal policy is expected to be tilted toward "adjusting structure" and "benefiting people's livelihood", and the focus of a moderately loose monetary policy will shift from "loose" to "appropriate."
Consumer policy may improve
The Central Economic Work Conference has often become an important indicator for judging the market in the second year, and the Political Bureau meeting of the CPC Central Committee held on November 27 is considered as the "regulation meeting" of the Central Economic Work Conference.
The Politburo meeting emphasized that to maintain the continuity and stability of macroeconomic policies, continue to implement proactive fiscal policies and moderately loose monetary policies, and focus on improving the pertinence and flexibility of policies in light of the new situation and new situations. The conference also highlighted: "We must promote domestic demand, especially consumer demand, to continue to grow, increase the spending power of residents, especially low-income people, and improve policies to promote consumption."
In terms of specific measures, the Politburo meeting on November 27 proposed ten specific directions. In addition to maintaining the basic orientation of macroeconomic policies and macroeconomic control, consumption has become the first mentioned content. The meeting proposed that it is necessary to promote the continuous growth of domestic demand, especially consumer demand, increase the spending power of residents, especially low-income people, and improve policies to promote consumption. Experts foresee that the Central Economic Work Conference will continue the “improvement and consumption policies†of the Political Bureau of the CPC Central Committee.
Credit policy may be fine-tuned
Mei Xinyu, an expert from the Institute of International Trade and Economic Cooperation of the Ministry of Commerce, said in an interview with the media that at the moment, the world economy has not yet fundamentally recovered, and China’s economic recovery is also facing many uncertainties. Expansionary policies should not shrink sharply in the first half of next year. However, policy fine-tuning is also inevitable.
He believes that monetary policy, which plays an important role in this crisis response process, will return to a true “moderate†year. Although interest rates, deposit reserve ratios, etc. may not necessarily be adjusted soon, the government will take action on credit policies and implement “differential treatment†for different industries and companies. At the same time, in terms of structural adjustment and promotion of consumption, policies will have more ink to promote sustainable economic development.
Steady word continues to be a stimulus
According to Jian Ping, chief economic teacher of the National Information Center, China's current economic growth is still lower than the long-term potential growth rate, and there is little pressure on rising prices. Therefore, in 2010, the basic policy orientation should be “steady growth, structural adjustment, and prevention of inflationâ€.
The key to “steady growth†is to manage the pace and intensity of government investment.
Fan Jianping said that government investment is the main driving force for the rapid recovery of the Chinese economy this round, and it is also the only area likely to overheat next year. He suggested that the government should focus its efforts on improving the efficiency of investment and managing the already launched projects. Be cautious about "new facilities".
Mei Xinyu pointed out at the same time that the Central Economic Work Conference will generally only outline the major framework of economic policy in the coming year. To establish confidence and stabilize expectations, the current policy should still take the word “stable†and the stimulus measures will continue. However, macroeconomic regulation is not static, once the domestic and international economic environment has undergone a major turning point, the official will also make the right remedy and make adjustments.
2010 is the last year of implementing the "Eleventh Five-Year Plan". Doing a good job in economic and social development next year will be crucial for the effective response to the impact of the international financial crisis and the consolidation of the foundation for economic recovery, and creating favorable conditions for the implementation of the “Twelfth Five-Year Planâ€.
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