Monday, October 20, 2008

Premier Wan's 10 Economy Saving Measures...

溫拾招
國家統計局公布內地第三季經濟數據前夕,總理溫家寶上周五(17日)召開國務院常務會議,提出「靈活審慎的宏觀經濟政策」,包括:
1.加大對農民農村優惠力度
2.鼓勵金融機構增加對中小企貸款
3.提高服裝、紡織、機電產品出口退稅率
4.加大投資、保持合理投資規模
5.繼續控制物價上漲
6.推進節能減排,嚴控環保監控
7.加強稅收徵管,嚴控支出
8.加強金融監管,防範金融風險
9.做好食品安全和安全生產工作
10.解決涉及民生的問題,加大保障性住房建設規模,降低住房交易稅費,支持居民購房

新華社引述會議稱,「國際經濟環境中不穩定因素明顯增多,對中國的影響逐步顯現,國內經濟運行中出現了一些新情況、新問題。主要是經濟增長放緩趨勢明顯,企業利潤和財政收入增速下降,資本市場持續波動和低迷」,並重申結束的中共三中全會提出了「堅定信心,冷靜觀察,多管齊下,有效應對」的16字方針。會議還提出「加大保障性住房建設規模,降低住房交易稅,支持居民購房」。所謂保障性住房,即針對中低收入建造的經濟適用房和廉租房。

據統計,北京、上海等內地13個大城市今年計劃新建保障性住房面積共4894萬平方米,佔新建住房面積比例為27.8%。全國大部分城市保障性住房面積佔新建住房面積的比例都在10%以上。有分析認為,由於保障性住房在內地城市房市中亦佔有一定比例,會議提出「支持居民購房」,對樓市也會有一定的刺激作用。

The above announcement is interesting.

The first 3 target on the plummeted farmers and SME in manufacturing and export sectors. However, the first measure will be encountered and even offset by 9 due to the markt structure: small individual farmers, with insufficient subsidies, comprised of the main force and hence are incompetitive in the highly commiditized farming products market. Without sufficient incentive, farmers are either continuing to cheap chemcials to replace natural products or selling their lands to real-estate/manufacturing sector, which in turn will be in conflict with measure 6.

Measure 6 and 7 will again counteract measure 2 and 3. Entrepreuners who have invested in China understand how complicated and heavy and unfair the tax is. The source is the central goverment that wants to save as much money as possible in their own accounts and wants to benefit the state-owned enterprises as much as possible. Besides, environmental regulations are known as a tool of asking money from the enterprises by the municipal and county governments. But, the most important point is: with the declining OECD markets, measure 2 and 3 can only be bandages. The previous tightening on 6 and 7 has already resulted in waves of bankrupcy of manufacturers. It is already too late to start on preserving them (as many of them had cut too deep already).

Measure 10 just walks on the previous steps of US government. And it is apparent that it is against measure 5. If measure 10 is successful, measure 5 is not, and vice versa.

Now, the noticable part is 4: what will the central government do? How much will they invest? Are these investment are for job creations only, or can really improve competitiveness of China? And can with these investment government can improve the supplies side efficiency and hence control 5? Lets pay attention to the forecoming details.

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