Event overview
From December 8 to 10, 2021, the central economic work conference was held in Beijing.
Investment view
For some time to come, we will focus on “steady growth” and be proactive, proactive and effective in terms of finance; In terms of monetary credit, ample liquidity has achieved stable credit and moderate credit. On the basis of steady growth, we will firmly promote supply side structural reform, optimize the quality of economic growth and cultivate long-term growth potential.
Economic growth has short-term pressure and strong long-term toughness
The central economic work conference pointed out that in the short term, China’s economic development faces triple pressures of shrinking demand, supply shock and weakening expectations; But in the long run, the fundamentals of China’s strong economic resilience and long-term improvement will not change.
For next year’s economic work, the meeting stressed the need to make steady progress while maintaining stability, and promote the steady improvement of the quality and reasonable growth of the economy. It is clearly stated that all regions and departments should shoulder the responsibility of stabilizing the macro-economy, and all parties should actively launch policies conducive to economic stability. Steady growth will become an important task for next year’s economic work.
The contents of the meeting mentioned “six stabilities” and “six guarantees” many times, with special emphasis on the protection of employment, people’s livelihood and market subjects.
The “front” of macro policy will be confirmed next year
In terms of macro policy, the meeting proposed to continue to implement an active fiscal policy and a prudent monetary policy. In addition, it is specially proposed that the “policy force should be appropriately advanced” next year, and the “front” of macro policy next year will be confirmed.
In terms of fiscal policy, active fiscal policy should improve efficiency and pay more attention to accuracy and sustainability. The meeting proposed to moderately advance infrastructure investment, and it is expected that the growth rate of infrastructure investment will stabilize and recover in the following months. In addition, with regard to the risk of local debt, the meeting clearly stressed that we should resolutely curb the new implicit debt of local governments, and the proportion of infrastructure investment funds from explicit channels will continue to increase.
In terms of monetary policy, prudent monetary policy should be flexible and appropriate, and maintain reasonable and abundant liquidity. In terms of financing, we will increase support for small and micro enterprises, scientific and technological innovation and green development.
Industrial policies continue to optimize the economic structure
In terms of structural and industrial policies, the meeting stressed the need to deepen the structural reform on the supply side and break through the blocking point of supply constraints. In terms of industry, it is proposed to improve the core competitiveness of the manufacturing industry and stimulate “specialized and new” enterprises. Specifically, the meeting mentioned the construction of efficient logistics network and the digital upgrading of traditional industries.
In terms of real estate, the meeting once again proposed “no speculation in housing”, and mentioned accelerating the construction of long-term rental housing and affordable housing.
Correctly handle the relationship between “double carbon” and “guaranteed supply”
After the correction of sports carbon reduction at the Political Bureau meeting in the middle of the year, the central economic work conference once again stressed the correct understanding and grasp of “double carbon”, and mentioned that “it is impossible to accomplish its work in one battle”. Considering China’s basic national conditions dominated by coal, the “dual control” of energy consumption should not affect the normal supply of coal and other energy in the short term. The meeting also proposed to realize the transformation from “dual control” of energy consumption to “dual control” of total carbon emission and intensity as soon as possible.
The meeting also stressed on many occasions the in-depth implementation of the supply guarantee policy: for primary products such as agricultural products and upstream industrial products, we should adhere to economy and enhance production guarantee capacity; In terms of energy supply, it is proposed that large enterprises, especially state-owned enterprises, should take the lead in ensuring supply and price stability.
Risk statement
Macroeconomic or policy changes exceeded expectations.
