The vast majority of state-owned enterprises and local governments will never be able to pay back their debts, not only their debts, but also their interest. They need to pay back their interest by expanding the debt base, because the whole society has been increasing wealth to expand the leverage ratio of the state-owned enterprise sector, which will definitely require a second reform in the end, said Mao Zhenhua
In addition, Mao Zhenhua also pointed out three problems that state-owned enterprises cannot solve: first, the current labor-intensive problem. Because the state-owned enterprises are generally capital intensive and resource monopolistic, but China has such a large competitive population, if we do not engage in labor-intensive enterprises, we cannot solve the employment problem, we must rely on private enterprises; secondly, the problem of foreign exchange earning through export, because there are few enterprises in general, mainly using monopoly to sell to China, not to the whole world; thirdly Third, scientific and technological innovation depends on private enterprises.
Looking forward to the macro-economic situation in 2020 next year, Mao Zhenhua believes that there is still downward pressure on Chinas economy in 2020. On the one hand, the trend factors leading to Chinas economic downturn have not improved or even worsened significantly; on the other hand, the short-term economic weakness factors still exist, infrastructure investment is limited by the recovery range of local governments income and expenditure pressure, real estate investment without speculation under the tone of financing constraints, fixed asset investment is difficult to improve significantly, and consumption is subject to residents Due to the double constraints of slowing growth of sector income and increasing debt pressure, the global economy is weak and exports are still facing uncertainty under the game between China and the United States.
On the whole, under the influence of the superposition of trend factors and short-term factors, and the strengthening of international and domestic adverse factors, the economic growth rate will fall further in 2020. However, Mao Zhenhua also reminded that Chinas economic operation still has certain toughness, the role of policy in stabilizing growth will continue to show, the inventory cycle has approached the bottom or will usher in the bottom rebound, with the gradual resolution of risks, the financial environment is expected to continue to improve, the adjustment of consumption and industrial structure will also improve the resilience of Chinas economic growth, so there is no need to be too pessimistic about the economic growth in 2020.
Source: editor in charge of economic observation network: Wang Xiaowu NF