Capacity transfer, local debt and social financing growth rate｜"Caijing" editori

Recently, the growth rate of social financing has not met market expectations, which is both "unexpected" and "expected." On one hand, the scale of social financing stock is already considerable, and on the other hand, the central bank has also given hints, suggesting that the market should pay more attention to the improvement of credit quality and structure. In addition, there are local governments facing debt reduction pressures, and there is a need to further stimulate corporate investment and consumer spending among residents, among other explanatory analyses.

In the analysis of many, "overcapacity" has become a key term. However, for this round of structural overcapacity in some industries and regions, it is necessary to combine specific time and space for analysis in order to more accurately identify the crux and better prescribe the right remedy.

The performance competition of local governments was once considered a key driver. It should be said that "pro-business" local governments and their competition with each other are one of our institutional advantages, especially during periods when the industrial and market foundation is relatively weak. The capabilities and efficiency of some local governments in promoting industrial planning and implementation, as well as in building "simulated markets," have played an important role in helping some places quickly shed their backward situation and in the rapid increase of China's economic total.

However, an issue that cannot be ignored in the process of local government-led industrial overtaking is that the industries they plan and introduce are relatively mature industries, which is clearly evident in the list of achievements of recent catch-up leaders such as Hefei and Chengdu. This is partly because local government performance competition has its inherent cycle, and on the other hand, it is because compared to enterprises, the fiscal and financial resources used by the government pay more attention to the timeliness and stability of returns.

In the competition after 2008, the performance of the central and western regions was particularly eye-catching, which is closely related to the increasing number of mature industrial tracks in China and the increasing ability of related enterprises and local governments to work together in layout. This is certainly conducive to rapid expansion and strengthening, but on the other hand, it is also undeniable that it is more or less not conducive to the cultivation of patient capital and the introduction of new tracks with more innovative content, which to some extent has also exacerbated the overcapacity in stages.

In addition, because the dual-driven model of urbanization and industrialization that has been in place for many years in the coastal areas is already proficient, it is particularly easy for the central and western regions, as latecomers, to use. Therefore, the industrial catch-up and urbanization remediation in the central and western regions often go hand in hand, and the investment momentum is like a raging fire. The financial resource support for the catch-up economy is often mainly in the form of credit, and the central and western regions are no exception, which is also the main driver of the rapid rise of China's social financing scale in recent years.

There are always winners and losers in competition, and there are always losers and the disappointed in the process of overtaking. When people focus on the successful experiences of places like Hefei and Chengdu, they may also inadvertently overlook the negative effects accumulated by the losers and the disappointed. At present, the local bubble of real estate in some areas, the overcapacity in stages, and the accumulation of local debt are intertwined with the rise and periodic deceleration of China's total social financing, becoming a multifaceted problem that requires extra patience to disassemble and deal with.Of course, the emergence and response to problems do not detract from the rationality and achievements of the phased catch-up in the central and western regions. The catch-up in industrialization and urbanization in the central and western regions has won precious time and space for the coastal areas, which were more severely impacted by the global financial crisis after 2008, to recuperate and set off again. It has also made a significant contribution to the establishment of a unified national market. Without the leap in infrastructure in the central and western regions, "my Altay" could not become "your Altay," and the green mountains and clear waters would not have the opportunity to turn into mountains of gold and silver. If we extend our perspective, overcapacity is, to a certain extent, a pseudo-problem. Each round of the emergence of new industries and new tracks is always accompanied by the reuse of "old capacity," such as the vigorous development of new energy vehicles, which has put forward new demands for the electronics industry that was previously considered traditionally excessive.

In this world, it is almost impossible to enjoy the benefits without suffering the drawbacks; it is nothing more than a dynamic weighing of pros and cons and making timely choices. To solve the current economic problems faced by China, it is necessary to adopt policies that are timely and location-specific, and more importantly, to have a holistic thinking approach.