China is adjusting its economic layout on a large scale (in-depth article)



This article is a speech by Wei Jie on the latest trends in China's macroeconomics at Hupan University on the morning of November 11, 2018.

Wei Jie: Let me have an exchange with you all over the next period of time. As you may know, since March this year, there have been six serious phenomena in Chinese social life.


The first phenomenon is that a large number of small and medium-sized enterprises reflect that enterprises are very difficult to do and are under great pressure. There are both cost pressures and capital pressures. Since June and July, there have been some bankruptcies and closures, so the first thing that reflects the real economy is that most companies are calling for very difficult actions. The phenomenon of bankruptcies and closures began to occur in June and July.


The second phenomenon is that corporate defaults are getting more and more serious. It is impossible to repay the debt when it is due, and the situation of default is very serious. At first it was a state-owned enterprise, then a private enterprise, and finally a listed company. There are many defaults by listed companies. As a result, it seems that the rupture of the debt chain has become an increasingly serious phenomenon.


The third phenomenon is that non-bank financial institutions, especially the so-called new business formats, have experienced explosions in recent years, and a large number of problems have occurred in non-bank financial institutions in recent years. It was very serious in July.


The fourth phenomenon is an irrational decline in the stock market. It turned out that we thought that the national economy might have affected the stock market from 300 points to 2,800. As a result, we did not expect that the U.S. stock market plummeted and produced another 300 points. At around 2,500, the stock market fell irrationally.


The fifth phenomenon is that investors are more panicked. Because no security assets can be found, no one knows which assets are the safest, and no security assets can be found. Investors are very panicked because they can’t find the safest assets and don’t know. Because the security asset is like a social motivation weighing machine, once it is not there, the whole thing will be out of balance, and the pressure will be very high.


The sixth phenomenon is that people feel very confused, and they are not optimistic about it. I don't know where China is heading, I am very confused, and the confusion has become more serious after October.


As a result, these six socio-economic phenomena have appeared since March, and generally speaking, they are not too optimistic about the future.


Then there is a question. Why do these six phenomena appear now? Why do people feel that future expectations are not good? Then we need to analyze it.


Analysis results found.


There is no problem with the fundamentals of China, and there is no problem with the fundamentals of the entire social economy. The desire of the Chinese to get rich is still very strong, the motivation is still there, and the impulse is still very strong. Especially the more you reach the grassroots level, the stronger this motivation is. The driving force for China's economic growth still exists, and people's pursuit of interests and the desire for a better life are still very powerful.


Second, there is no problem with the market. China is still one of the largest single markets in the world, with a population of nearly 1.4 billion. The proportion of the middle class is still increasing, and there is no consumption degradation. There is no evidence for the view that consumption is downgraded. It is only because the sales of mustard and instant noodles are too much that consumption is downgraded. There is no evidence to support it. China is still a country with a very large market.


Third, China is still the country with the most complete industrial categories announced by the United Nations. According to the industrial categories promulgated by the United Nations, China is the most comprehensive country. There is no such phenomenon because of rising labor costs and some manufacturing industries leave China. The most typical Dongguan is one of the important Chinese furniture manufacturers. We found that it still exists and has not gone. They have absorbed the pressure brought by the rising labor force through self-adjustment, so the industrial categories are still very complete, and this has not changed.


Fourth, China's transportation facilities are still one of the most convenient and convenient countries in the world, and they will get better and better. This will have great benefits for products to break through the transportation pressure. Transportation facilities are still the most convenient and convenient country.

Fifth, the top decision-making level has no intention to change the trend of reform and development. Although there are various opinions in the society, such as the enthusiasm of the private economy, etc., the top decision-making level does not have any intention to change the trend of China’s reform and opening up. There is no such thing. intention.

If analyzed in this way, there is nothing wrong with the most fundamental aspect. Since there is no problem with the fundamentals, why do these six phenomena appear? Later analysis of the results found that mainly five things collided together. Each of these 5 things has negative things. A single appearance will not affect too much, but the effects that appear after 5 things collide together, the negative effects are superimposed. The negative things brought about by each of these 5 things are superimposed together, this is a bit more troublesome, so the phenomenon of superposition of negative effects has appeared, leading to the production of these 6 phenomena.


What are the 5 things:


The first thing is that we are preventing financial risks.


Many policies have been introduced to prevent financial risks, such as deleveraging, controlling real estate, and managing financial chaos, etc. These practices have the effect of a double-edged sword. While realizing the prevention of financial risks, they have brought negative things. As a result, the corporate capital chain is under pressure or even broken. In particular, companies with high debt and high growth in the past are basically unable to survive. And they have various connections with normal enterprises, which makes normal debt enterprises unable to operate. As you know, China is a country that has been operating on high debt for a long time. Direct financing accounts for a very small proportion. It basically relies on debt-to-debt operations. It has been like this for decades.


Suddenly they have to de-leverage and shrink their debts. Companies can't stand it at once, causing some companies with high debts to break their capital chains, and they have various connections with other companies with normal liabilities, causing normal companies to have problems.


The so-called prevention of financial risks is right and nothing wrong. The problem is that the negative things it brings have also emerged. From an economics point of view, any countermeasure is a double-edged sword. Therefore, preventing financial risks from causing an important pressure is that the company's capital shortage is more serious. Debt defaults, broken capital chains, coupled with some people's rude practices in the operation, blindly reluctant to borrow money, make the situation worse. The first thing is to prevent financial risks from causing some negative things, and the corporate pressure is very high.


The second thing is that we are doing supply-side structural reforms.


Supply-side structural reforms are actually structural adjustments. The economics community divides people's lives into demand-side and supply-side. The demand side, investment demand, consumer demand, exports, etc., this is the demand side. The supply side refers to the production side, and the supply side structure refers to the industrial structure. Therefore, the industrial structure is being adjusted because some industries that originally supported us cannot continue to support China's economic growth. For traditional manufacturing, construction, and real estate industries, it is difficult to sustain growth because they all have problems one after another. The so-called traditional manufacturing industry has serious overcapacity, and we propose to reduce production capacity. The real estate bubble is forming, and we have to curb the asset bubble, which indicates that it is difficult for these industries to continue to support China's development. China needs new industries that support growth.


These industries have been judged through analysis, know which industries will support us, and proposed that the three major industries will support China in the future. The first is strategic emerging industries, such as new energy, new materials, bioengineering, information technology and mobile Internet, energy conservation and environmental protection. , New energy vehicles, artificial intelligence, high-end equipment manufacturing, etc., we also call the strategic emerging industries, which will support our growth. The second is the service industry, which will become an important industry supporting China's development. Consumer service industry, business service industry, production service industry, spiritual service industry, etc., will all support China's growth. The third is modern manufacturing, such as aerospace manufacturing, high-speed rail equipment manufacturing, UHV transmission equipment manufacturing, modern traditional manufacturing, etc., will support China's growth.


Recognizing that these three major industries will support China's growth, they are promoting structural adjustments. However, adjustment needs a process. Currently, there is a gap in adjustment. The contribution of the original traditional industries is declining rapidly, while the new industries are not rising, or are rising, and there is not so much power, and there is a gap in structural adjustment. The negative thing brought about by this gap period is that there is a lot of pressure for growth to fall, growth cannot be stabilized, and income has been going down. Therefore, the gap period of structural adjustment brings a lot of pressure, that is, the pressure of falling growth is very large, which leads to unclear expectations for future judgments. This is the negative thing brought about by the second incident. The gap in structural adjustments has led to greater pressure on the growth rate to fall.


The third thing is that China is transforming new and old kinetic energy.


It turned out that the main support for China's growth was cost advantage, which has disappeared drastically. Logically speaking, the disappearance of cost advantages should be made up of technological advantages. After the disappearance of cost advantages, technological advantages should grow up quickly to ensure China's growth. But the problem now is that the formation of technological advantages requires a process, and there is a gap in the conversion of new and old kinetic energy. The original advantages are being lost, and new technological advantages have not yet come out, resulting in greater pressure for growth to fall. There is also a gap in the conversion process of new and old kinetic energy. The negative thing is that the pressure of growth and decline is relatively high, and people's expectations do not seem to be very good.


The fourth thing is that China is carrying out the reform of ecological civilization.


You know the biggest difference between the 19th CPC National Congress and the past, mentioning the "five major reforms", economic, political, cultural, social, and ecological. The reform of ecological civilization has become one of the "five tasks" of reform, and we are promoting the reform of ecological civilization. Ecological civilization is nothing more than two things. One thing is to solve the treatment of waste water, waste gas, and solid waste in the process of industrialization and urbanization. This requires an increase in corporate emission standards, because as long as this is done, it will inevitably require companies to increase their emission standards, and the standards for waste water, waste gas, and garbage must be increased. Another thing is the restoration of the ecological environment, because this is an important aspect of the so-called ecological civilization, the restoration of the ecological environment.


Ecological confusion restoration also imposes high requirements on enterprises. For example, in the Yangtze River Economic Zone, no factory-type enterprises are allowed to be built within 3 kilometers. It must be moved now. The reform of ecological civilization has caused one thing. Enterprises are under great pressure due to ecological problems. In addition, our law enforcement process is relatively rude, which has caused many enterprises to shut down and stop production. The growth rate will inevitably fall, and the pressure will be very high. The reform of ecological civilization has caused a very troublesome thing. Whether it is emission standards or relocation of enterprises, it will affect the current economic growth, and there will be greater pressure for the growth rate to fall.


In the past, we called the ecology and the environment to make way for development. As long as the development of other things is easy to handle, now it is the other way round. Now it is development to make way for the ecological environment, and different governing thinking has emerged. It turns out that as long as the development is easy to handle, the environmental and ecological impact is not good. Now everyone sees that development has to make way for the ecological environment. When it comes to the Yangtze River Economic Belt, everyone thought it would require major development. In the end, it was proposed that it was mainly for protection. No factories or enterprises within 3 kilometers were allowed to be built, and they had to be moved. , Have to move, the result is that the economic growth will be affected, and the pressure of the growth will be relatively high. It is already obvious what you want. In the past, we wanted to develop, but now we need the ecological environment. Of course, development and growth will be affected.


Last time one of our pharmaceutical companies was in Yinchuan, because it was the raw material productivity of many pharmaceutical companies. As a result, the ecology was shut down, so I went to see it. I understood at a glance, what you want, if you want to develop and continue production, you have to close the environment. The trend of our country's mountains is going westward, and only one north-south direction is Helan Mountain, which gave birth to the Yinchuan Plain. If left alone, this plain will not disappear in 20 years. You have to figure out what you need to do. Now it is obvious that the environment needs to be ecological, and as a result, the pressure on the growth rate to fall is relatively high.


The fifth thing is the Sino-US trade war.


The U.S. is fighting a trade war. We didn’t want to fight it. At least I didn’t want to fight it. Because the U.S. economy is in an upswing period. From an economic perspective, it can fight a trade war with China during the down period. of. It turned out that we judged that the trade war would not have too much impact on us, but we did not expect that it would have a great impact on people's psychology. Logically speaking, we have calculated that the United States is able to digest it in a trade war with us. But when we played ten years ago, we must be over and get down on the ground. You can check the information. In 2007, our growth method was export-oriented. In 2007, our GDP was 27 trillion yuan, exports were 9 trillion yuan, and imports were 5 trillion yuan. The proportion of exports in GDP is almost 30% or more, and the surplus accounts for 11.3% of GDP. These two figures show that China is an export-oriented country.


This is the U.S. is going to fight a trade war, and we surrender on the spot because we can't stand it. Then in 2008, there was a world financial crisis. This crisis was a problem of China's sober understanding. A country with a large economy like China cannot use exports as a guide to develop its economy. China has relatively adjusted its strategy and moved towards a domestic demand-driven type.


We started the transformation in 2008, and we have transferred it for ten years, and we actually transferred it last year. Last year's total GDP was 82 trillion yuan, exports were 15 trillion yuan, and imports were 13 trillion yuan. The proportion of exports in total GDP fell by about 15%, from 30% to 15%, which was down by half. The proportion of surplus in exports dropped from 11.3% to 1.3%. This data shows that China has adjusted. Let's do the calculations. The United States fights the trade war to the end, and prevents China from exporting to the United States for a penny. The impact on us is 0.2-0.5 growth. We can digest this, and there is no problem. But I did not expect to have such a great psychological impact on us. As long as the United States announces a tax increase, the Chinese stock market will fall sharply the next day. Stockholders always ask us that we have no exports. We are always the ones who are injured. The export volume of listed companies is not large. Why do they always affect the stock market? Because of psychological problems, the stock market is the most psychologically affected market. I did not expect the psychological impact to be so great.


This psychological influence has almost caused a great impact on us as a whole. Because the Sino-US economic relationship has been generally stable for 40 years, people have no way of judging this problem at once, and they are very worried about whether it will go to the cold war. If it is really going towards the Cold War, China's economy will be very troublesome, so it will have a great psychological impact on this kind of psychology, causing people to be very confused and have poor expectations.


Each of these five things has negative things, and it is easy to handle them individually. As a result, the five things collide together, and the negative things collide together. The concept of economics appears, and the negative effects are superimposed. Negative things collided together, and the negative effects were superimposed, which finally led to the superimposition of negative effects in the Chinese economy from March to the present.


This analysis can lead to the conclusion that China's economy has not entered a period of recession, but has entered a period of adjustment. This is an important judgment.

From a fundamental point of view, we have not entered a period of recession. The reason is that five things collide together and have negative effects superimposed, which indicates that China's economy has entered a period of adjustment. We estimate that the adjustment period will take at least three years.


In 2018, 2019, and 2020, it will take three years of adjustment to enter the stage of high-quality development. The high-quality development stage is not a slogan. To truly shift to standardization, three years will be an adjustment period. After these negative things are resolved one by one during the adjustment period, the Chinese economy can enter the so-called high-quality growth period.


The Chinese economy has not actually entered a period of recession, but has entered a period of adjustment. How to adjust, and gradually form a consensus, roughly three things must be done:


The first thing is to stabilize the finances.


Finance must be stable, and finance must not experience major fluctuations, so the first thing is to stabilize finance. Because once the financial stability is not stable, the adjustment period will be difficult to pass. The development of the overall real economy depends on financial support. Once the financial industry experiences major ups and downs, there may be chaos during this adjustment period. Therefore, the first thing to do is to stabilize the finance, and the finance must be stabilized.


How to stabilize the finance? Five things are estimated to be done:


The first thing is to control the monetary policy.


The core of finance is monetary policy, which must be controlled well. The goal of controlling monetary policy is to prevent operational risks on the one hand, and to maintain growth on the other. These two must be combined.


In this way, there are three key points to control the monetary policy, and three key points must be controlled:


The first point is to ensure a neutral and prudent monetary policy. This cannot be changed. If the monetary policy moves towards easing again, then financial risks will surely break out. Don’t think about it, the pressure of financial risks will break out again, so we must maintain a neutral and stable monetary policy. An important indicator of maintaining neutrality and stability is to control the growth rate of the money supply.


Those of you here know that the growth rate of money supply can be simply understood as the speed of money production and the speed of money issuance. It can be so simply understood. This data must be controlled, because this data marks the currency issuance. An important indicator of neutral stability is that the money supply growth rate must be operating at a low speed. According to economic principles, the GDP growth rate plus the inflation rate, plus another parameter should be the money supply growth rate. From this point of view, we have basically controlled the currency growth rate of 8.3% in September. As you know, it used to be below double digits, with an annual average of 17%. Now it has been controlled to a single digit, 8.3%, which is GDP 6.5. % Plus the inflation rate of 2%, and another adjustment parameter is the data it should have. It seems that this article is doing well now. It has remained in the single digits since this year. It was only 8.3% in September, and the data for October has not yet come out. We must ensure that this data is neutral and stable. If this data is not well controlled, very important operating risk pressures will occur. The first point of controlling the monetary policy is to maintain a neutral and stable monetary policy.


The second is sufficient liquidity to ensure sufficient liquidity. The liquidity of enterprise production and operation activities must be satisfied, which is called sufficient liquidity. This article seems to be adjusted recently, and it must be adequate. What to do? A lot of currency tools must be used, such as RRR cuts. A few days ago, it was a reverse repurchase of 150 billion, which is equivalent to releasing another 150 billion of liquidity to the market. In this way, an important point of monetary policy is to ensure sufficient liquidity. Monetary policy tools must be used. The purpose of recent adjustments is to ensure the normal demand for funds by enterprises and sufficient liquidity. This seems to be able to be maintained.

The third is that monetary policy must achieve its goals smoothly. The transmission mechanism must be smooth. For example, monetary policy supports the real economy and the private economy. This is a targeted goal. How can it be transmitted? Then study the monetary policy transmission mechanism must be smooth. For example, in order to support the private economy, a new index has been added to the evaluation index of banks, which is proportional control. Assuming 10 billion loans this year, 40% of the loans must be guaranteed to the private economy, with strict evaluation indicators. It used to be a slogan, but now it is an indicator, which can ensure a smooth flow to the private economy. The monetary policy transmission mechanism needs to be adjusted smoothly. At present, the biggest adjustment is the structural control of bank loans. There are quality requirements for how much loans are made this year and how much will flow to the private economy.


Comrade Guo Shuqing recently said that at least one-third of the loans of big banks will go to the private economy. Two-thirds of the loans of small and medium-sized banks must go to the private economy. After five years, 50% will go to the private economy. This is a structural control. This control ensures the smooth transmission mechanism of monetary policy. In the past, we always talked about supporting the private economy, but the reason for not being able to support it was because the transmission mechanism was problematic and the transmission could not continue. Now it must be smoothly transmitted. Furthermore, to support the real economy, it is necessary to stipulate this year's loans. For example, 10 billion and 9 billion must flow to the real economy, and the non-real economy is 10%. This can be called supporting the real economy. All banks use new evaluation indicators, and the new evaluation indicators achieve an important result, which is a smooth transmission mechanism. To support the real economy and the private economy, the transmission mechanism must be smooth. Adjustments are being made recently. I estimate that after a month, everyone will generally feel that they really support the real economy and support the private economy. Because the transmission mechanism has been adjusted, it should be smoothly transmitted.


The first thing we do to stabilize the financial system is to control the monetary policy, mainly based on these three points. One is to adhere to a neutral and prudent monetary policy; the second is to ensure sufficient liquidity to meet the capital needs of enterprises; the third is a smooth transmission mechanism that can achieve the set goals, such as supporting the real economy and supporting the private economy. This is the key to financial stability. The first thing to do is to control the monetary policy. There are three main points in controlling the monetary policy. One is to maintain a neutral and stable monetary policy; one is to ensure sufficient liquidity; the other is to ensure a smooth transmission mechanism. If these three items are adjusted properly, we can achieve the goal of stabilizing finance, which is the first thing we need to do to stabilize finance.


The second thing is the deleveraging policy. The deleveraging policy needs to be adjusted now.


Deleveraging is true, because leverage is really high. According to the data released in the first quarter of this year, government debt accounted for 35.2% of the total GDP, which is relatively low. The reason for the low is not fraud, but because the government debt is not included in the statistics and is classified as corporate debt. Second, corporate debt is 159% of GDP growth. This figure is too high, and corporate debt is not that much. The reason for the high level is that the two levels of government are classified as corporate liabilities, one is development zone liabilities, and the other is local financing liabilities. If these two are removed, corporate liabilities only account for 130% of total GDP, which is not so high. The nature of the borrower is indeed an enterprise. If it is removed, the real debt of the enterprise is 130% of the total GDP. The third is that personal debt accounted for 55.8% of the total GDP. At the end of 2015, personal debt accounted for 30% of the total. In 2016 and 2017, it rose sharply in the past two years, and now it has reached 55.8%. Personal debts are mainly home loans and car loans, in cities are mainly home loans, and in rural areas are mainly car loans, causing personal debt to rise too fast. Although it did not reach the red warning line, it rose too fast. When these three kinds of debts add up, the total social debt accounts for 250% of GDP, which is indeed too high. According to calculations by some scholars, when social debt rises to 270% of total GDP, it will detonate a serious financial risk. At the beginning of this year, we began to deleverage, which is to reduce the debt ratio.


Judging from the experience and lessons in the first half of the year, it seems a bit too strong, and a bit across the board. At the Politburo meeting on July 31, it was proposed to adjust the deleveraging policy, two adjustments. One is to control the intensity of deleveraging. The intensity must be controlled well. It cannot be too aggressive. If it is too aggressive, the company will not be able to stand it, and the intensity must be controlled well. No one has ever estimated how strong it is or what it means, and no one knows how much it is. I checked the information of the relevant decision-making departments and realized that the so-called strength means not to reduce the leverage to a normal level this year, but to take three years. First reduce the leverage ratio from 250% to 200%, 200% is still high, don't worry, continue to fall after three years, and then it will take two years to reduce to the normal level, and five years to reduce the debt to the normal level. If it drops from 250% to 200% in the first three years, the deleverage will be 40 trillion yuan, or about 13 trillion yuan a year. About 13 trillion yuan, companies can afford it, so the problem shouldn't be too big. In this way, after the adjustment of the intensity, it will generally ensure that it can prevent financial risks, but also ensure that the company's capital chain will not be broken and ensure that the company's capital needs are guaranteed.


One adjustment is the so-called good control; the second adjustment is to structurally deleverage, that is, no one size fits all, and the private economy is not highly leveraged, so don't talk about the so-called deleveraging. Structural deleveraging, whoever has high leverage will go to whomever has the highest leverage. I have set two key points, one is state-owned enterprises and the other is local government debt. These two are indeed a bit high. State-owned enterprise deleveraging and local government deleveraging have become the focus of structural leverage. State-owned enterprises deleveraging. I took a look. In the first half of the year, two measures were adopted to control the newly added leverage of state-owned enterprises. This is a new round. The debt has been controlled. The State Council issued a strict document that all state-owned enterprises’ debt must meet the required standards, starting with central enterprises. The documents are very strict, and the organization's debt continues to rise. Another article puts forward that we will no longer engage in rigid payment, and the state will no longer pay more for debts of state-owned enterprises. In the past, the state gave them all, which was called rigid payment. State-owned enterprises had no problem in borrowing money, and they could eventually repay it because the state made a lot of money. In the first half of the year, it was formally proposed that the state will not cover the bottom line, and it is all limited liability. Therefore, borrowing money from state-owned enterprises and buying state-owned enterprise bonds must be a bit leisurely, and it may not be possible to get the money back.


Many state-owned enterprises are ultimately dealt with in bankruptcy and reorganization, and a lot of money is a waste of money. If they cannot return, the state no longer engages in rigid payment. Strictly speaking, there are no so-called capital-guaranteed financial management projects, because they are all limited liability. This adjustment has led to the speed of state-owned enterprises’ new debt has been controlled. Now it is a question of how to deal with the stock, and how to deal with the borrowing in the past. Later, we decided on the idea that the stock of state-owned enterprises should be solved, and the solution of debts should be combined with the reform of state-owned enterprises. How to combine it? The reform of state-owned enterprises this year will be two priorities. One is to determine the main business, and the main business must be determined. After the main business is determined, the non-main business assets must be sold and must be realized. The realised money cannot be used for new investment, and the debt must be repaid, and the debt can be repaid through the realization of non-main business. The second focus of the reform of state-owned enterprises is the mixed economy. To promote the mixed economy on a large scale and to absorb a large amount of non-state capital into state-owned enterprises is tantamount to increasing the proportion of state-owned capital. The share is bigger, and the share value is lowered. The most successful is China Unicom's reform. An important result of China Unicom's mixed reform has reduced Unicom's debt. How did it come down? The country's rise in absolute control was reduced. The country no longer has a controlling stake in China Unicom, and the debt was reduced through the mixed reform. State-owned enterprise reform, the stock of state-owned enterprises seems to have fallen somewhat.


The other is the local government. The local government has now controlled the new debt. The "three measures" in the first half of the year were very strict. One method cuts off all the debts of development zones, and no development zone loans are allowed. Development zones are an important channel for local governments’ debts. They were completely cut off in the first half of this year, and no loans were allowed. I estimate that the flames in the development zone will basically be shut down next year. Second, the PPP project was cleaned up, and the 3P project was cleaned up. The important channel for local government debt is the 3P project. The central government has completely re-cleaned up. After the 3P project is cleaned up, it is equivalent to controlling the local government’s new debt. The third is that the Organization Department of the Central Committee issued a document. The assessment index for any cadre promotion or mobilization increase is the debt ratio. It does not depend on how much GDP you have built and how many roads you have built. It is necessary to check the debt ratio. Exceeding the debt ratio is dismissed on the spot and will never be used again, which is very strict. Recently, several county party committee secretaries were removed because the debt ratio exceeded the standard. Especially in poor counties, everyone noticed that several county party committee secretaries have been removed recently. This indicator connects the black yarn hats together, which makes it difficult to increase the debt ratio.


These three measures have actually controlled the new local debts. What are the main ones now, what to do with the stock, and what to do with the construction in the past. I go to a place where the total annual GDP is only 10 trillion yuan, and the debt is 200 trillion yuan. How do you want to pay it back? Of the 31 provinces and cities across the country, only 6 provinces and cities pay the central government, and the rest rely on central transfer payments to maintain operations. If you think about it, how does it pay off its debt? There are only two ways to pay off the debt, one is taxation, and the other is land sales. Taxes are basically too much to be paid back, because the central government transfers payments. Another issue is that land sales are constantly unsuccessful. I estimate that the most troublesome aspect of future stock debt is how to deal with the part of local debt, which is a big problem.


Some people always ask me why I prefer central enterprises, which are all in the upper reaches of the industry. The central government relies on its tax revenue to balance local finances, exceeding 3 trillion yuan a year. Although the efficiency is very low, the money is given to the country. The efficiency of private enterprises is high, but the money is not given to the country. Some people do not understand, so you have to understand and rely on it to balance the finances of all parts of the country. The central enterprises are all in the upstream of the industry, and the downstream is very powerful, and they are all making money. Although the efficiency of central enterprises is not high, they have paid the state. This can be balanced. This is a big problem. Local debt is a big problem. Structural deleveraging. I think the part of the so-called state-owned enterprises is still a bit lost. The local government is basically not lost now. Hangzhou has no problems, and Zhejiang has no problems, but there are problems in many places. There are more problems than there are no problems, so it is a difficult thing to do, but slowly solve it. This meeting did not mention deleveraging anymore. I estimate that the deleveraging policy will need to be adjusted a little in the future. What is the reason for the shift from deleveraging to stabilizing leverage? This year, the goal has almost been achieved. This year, deleveraging has been very strong, and the target has almost been completed. It is estimated that it will gradually shift to stabilizing leverage. First stabilize, don't worry, stabilize for a period of time, let the growth recover. The deleveraging policy will shift to stable leverage, which may be the next adjustment.

It is necessary to control the deleveraging policy. Everyone has seen that it has been adjusted for the second time since this year. It was the first time on July 31 that it was proposed to control the deleveraging force and structure deleveraging, and not to implement one size fits all. This meeting did not mention the issue of deleveraging. Maybe I guess it will move towards stabilizing leverage. I will stabilize for a period of time before talking about it. The task of deleveraging is not something that can be accomplished in one or two years. It is a process that may gradually move towards a stable leverage. In the next few months, deleveraging must move towards stable leverage. This is right, because you have to ensure financial stability and the financial sector cannot experience major fluctuations, so move towards stable leverage and appropriately stabilize leverage at the current state.


I took a look at the data. By the end of August, the leverage ratio had dropped from 250% to 242%. This is the data at the end of August. It shows that almost this year, the upward momentum of leverage has been controlled. Under this condition, it should be gradually stabilized for a period of time. It should not be too fast or too fast, and the lever will be stabilized. After December, people will feel that the shortage of funds will be gradually eased, and the demand for funds of the entire society will be eased, and there should be no major problems. This is the second thing to do to stabilize the financial sector. Adjust and control the deleveraging policy at any time to ensure that financial risks are prevented and the demand for economic growth must be ensured. This is the second thing to do to stabilize the financial sector.


The third thing is to stabilize foreign exchange.


Foreign exchange must be stabilized. Everyone noticed that the central bank officially announced the monetary policy report yesterday. In the third quarter policy report, there was a reference to foreign exchange, "pay more attention to the role of market regulation." This time it has changed. This time it is obvious that we should pay more attention to the regulation and control of foreign exchange countries, and once again tell everyone that foreign exchange cannot go wrong. Stabilizing foreign exchange seems to have been basically determined, and foreign exchange cannot go wrong. The monetary policy report last quarter was still emphasizing the role of the market. At this time, the role of the state was clearly emphasized. This shows that stabilizing foreign exchange is an important factor in stabilizing finance. Once foreign exchange goes wrong, the local currency will go wrong, and the weight of the entire society will disappear. Great turmoil. The key to financial stabilization is to stabilize foreign exchange. The central bank’s monetary policy report released yesterday once again emphasized the importance of stabilizing foreign exchange, and the country will release its role in this regard. How to be stable? Two formulations, one, the renminbi cannot continue to depreciate, this is one formulation. Someone once asked me what is the specific indicator of this sentence, how much is continuous depreciation, how much is non-continuous depreciation, a quantity. From the current point of view, it is impossible to break 7, which may be an indicator. Please note that there were two times when it was about to break through 7, August 21, and it was about to break through 7 a few days ago, but it bounced back immediately after two hours. Recently, the deputy governor of the central bank once again announced to the world that those of you who want to short the renminbi should take time. We have fought against each other and warned you not to short the renminbi. If it cannot break 7, it may be called the inability to continue depreciation. Judging from the current situation, the non-sustainable devaluation means that it cannot expire. Because it was about to break 7 twice in a row, and finally bounced back, it shows that the decision-maker's consciousness is that it cannot continue to depreciate or cannot break 7. This is an indicator.


The second indicator is that the amount of foreign exchange reserves cannot be continuously reduced. How much is called a continuous reduction, and how much is called a reduction. It seems that this number is very clear. Only 3 trillion yuan is the bottom line. At the end of October, it had reached more than 3,050 billion. In September, the price was very strong. It dropped more than 20 billion in one go. Is there anyone worried that 3 trillion can be held. I estimate that 3 trillion is a base price and cannot be lower than 3 trillion. There are two goals for stabilizing foreign exchange. One is that the renminbi cannot continue to depreciate; the other is that the amount of foreign exchange cannot be continuously reduced.


How to achieve this? I estimate that I will do four things. First, the projects that have been liberalized in the foreign exchange reform will continue to be adhered to. For example, an ID card can be purchased for 50,000 US dollars a year, and it will be released for export and study, and it will not be changed. If there is no change, it will be temporarily suspended. For individuals, the three overseas investments have basically been halted. If overseas real estate investment is not liberalized, either go to underground banks, or engage in false trade accounts, or people will take them out. I'm sorry now, if you want to buy it, don't make it public. It's all a problem to find out. Please note that this aspect may become stricter. The gray areas of the past are no longer good. Individual overseas real estate investment basically needs to be tightened in an all-round way. Overseas securities investment and buying American stocks in the U.S. market have discussed whether or not to release them, but now I’m telling everyone that I’ll stop releasing them. Overseas investment insurance investment has also been completely stopped, and we put consumer insurance. In the past, the gray area used to swipe bank cards in Hong Kong, but now it can only be used for consumer, but not for investment, because it has been completely stopped. The issue of liberalization of the three overseas investments of individuals is basically not discussed. Real estate investment, securities investment, and investment insurance investment, because it needs to stabilize foreign exchange.


In the past, there were no restrictions on withdrawing cash with bank cards overseas, but now one person is 100,000 yuan a year, which is now restricted. And recently, it has launched a very unique trick. The risk reserve ratio for forward foreign exchange transactions has been increased from 0 to 20%. If the bank wants to sell 100 US dollars, it must pay 20 yuan to the central bank for risk reserve. Recently, I researched, and now it’s not easy to let things go. I always look for all kinds of excuses when I buy foreign exchange, and I don’t sell it to you. A person with 50,000 US dollars and various excuses actually indicate a signal that foreign exchange is tightening, because it is one way to stabilize foreign exchange.


The second method, overseas mergers and acquisitions, technology mergers and acquisitions continue to support, there is no problem, how much foreign exchange is required for how much foreign exchange. However, the non-technical category has been halted. Last year, the policy was strictly reviewed, and this year, it will be halted. The National Development and Reform Commission officially issued a document that all six major types of overseas financial investment are not allowed to buy movie theaters, wineries, and clubs overseas. Last year it was strictly reviewed, and this year it was a total suspension. The wind has also been released, and how companies and individuals who bought these things overseas used to sell their foreign exchanges, and now they have to vacate them. Otherwise, let's wait and see, it's threatening. Now many people are selling these things overseas, loosing foreign exchange. Recently, it was announced that there were 100 private entrepreneurs in private enterprises in the past 40 years. In the past few years, the companies that bought and bought overseas have disappeared. Why, let's just dump the foreign exchange first. Otherwise, let's wait and see. The fact is to tell everyone that foreign exchange has been tightened across the board. Overseas mergers and acquisitions, technical mergers and acquisitions continue to support, and non-technical categories are fully suspended.


The third measure, “One Belt One Road” investment, will use RMB investment instead of foreign exchange reserves. In the future, “One Belt One Road” investment will be fully invested in RMB, and foreign exchange reserves will no longer be used because of the need to stabilize foreign exchange. The actual use of renminbi for investment is killing two birds with one stone. On the one hand, it reduces foreign exchange reserves and on the other hand promotes the internationalization of the renminbi. In this way, it makes sense to stabilize foreign exchange. We are the investment leader in the “Belt and Road” initiative. There is no question about what kind of investment we have the right and right to invest. It is estimated that the “Belt and Road” investment will be more invested in RMB in the future, reducing foreign exchange reserves and stabilizing foreign exchange.


The fourth method is to do more operations in the capital account. There are two channels for foreign exchange to enter China, one is a trade project and the other is a capital account. The trade surplus is now narrowing, and the rate of inflow of foreign exchange is slowing down. So if you want to maintain stability, you have to operate under the capital account. It is estimated that the next step will be to increase the intensity of operation under the capital account. For example, the recent issuance of RMB 5 billion of government bonds in Hong Kong has adjusted the coexistence of the US dollar and the RMB, which is meaningful for stabilizing foreign exchange. If another US$5 billion in Treasury bonds is issued, it would be equivalent to an increase of 5 billion in foreign exchange reserves. At present, many countries in the world are optimistic about China for a long time. In some countries, I am personally willing to buy foreign exchange so-called treasury bonds. We have to issue 5 billion US dollars in foreign exchange treasury bonds, which is equivalent to an increase in foreign exchange reserves of 5 billion. Issuing renminbi treasury bonds to stabilize the exchange rate, and issuing 5 billion US dollars is equivalent to an increase in foreign exchange reserves. In the next step, the country will frequently operate on the capital account, and it will definitely adjust because it needs to stabilize foreign exchange. Under the trade project, because the so-called trade war between the United States and China has affected China’s exports, the surplus is narrowing, but capital projects can still be co-operated.


In particular, China still has some major moves in these areas. Last month this year, we established an oil futures exchange in Shanghai and clearly announced that the currency traded on the Shanghai Petroleum Futures Exchange is the RMB, and that the RMB has long been linked to oil. In the past, the U.S. dollar was linked to oil for a long time. You know that it is inevitable for the United States to fight a trade war with us, and we have stabbed it. Now the world’s three major oil exchanges, London, New York, and Shanghai, do not use US dollars for trading. It has officially announced that oil-producing countries have taken renminbi after selling oil here, and they can buy gold at China’s Shanghai Gold Exchange. The world has discovered so many gold reserves in China, and we are one of the countries with the largest gold reserves in the world, so that we can support the stability of foreign exchange. In fact, many people don't know enough about the Shanghai Petroleum Exchange and don't know what it means. In fact, this is a major Chinese decision. After this decision is introduced, it should be said that foreign exchange can be basically controlled, so don't worry too much.


Generally speaking, stabilizing foreign exchange is the four methods, and foreign exchange should be stable. As long as the foreign exchange can be stabilized, as long as there is no trouble with this "weight", as long as the weight is there, there will be no major financial fluctuations in the transition.


The third item of stabilizing finance is stabilizing foreign exchange. This is roughly the current situation. This is the third thing to do to stabilize finance.


The fourth thing is to stabilize the stock market. The stock market must be stabilized. In the past, I did not know enough about this matter. Now I realize that the market must be stabilized and find a way to stabilize the capital market.


How to stabilize the capital market? Now it seems that there are three methods. The first method is to improve the quality of listed companies. The quality of listed companies must be improved. If the quality of the listed company is not high, whoever dares to buy your stocks may not buy your stocks, so improve the quality of the listed company. All reorganizations and mergers related to improving quality can be liberalized. As long as the quality of listed companies can be improved, reorganizations and mergers can be promoted. The second is to reduce administrative intervention in the stock market. Regulators should not intervene in stock market transactions, but only need to do one thing to ensure openness and transparency. The publication of information is open and transparent, and the information is open. Article 3: Long-term financial support is needed. China’s stock market is unstable and there is no long-term financial support, so social security funds and insurance funds can enter the market. The next step is to promote this medium and long-term funds to enter the stock market to solve the problem. If these three items can be achieved, they should be able to stabilize the capital market.


It seems to have been falling recently, and recently it has fallen below 2600. I guess it has something to do with the announcement in Shanghai that the Shanghai Stock Exchange will change a new section, the science and technology version, and it will require a registration system. This is a good thing. It is not only a reform but also a promotion of technological innovation. The sci-tech version is good for raising funds for China's technological innovation, and the registration system is equivalent to a means of stock market reform, which is a good thing. However, the impression of stockholders is to expand, so the stock market fell. In this way, everyone pays attention to the complexity of the stock market. These three basic countermeasures should be no problem. This is correct. However, because people's judgments on the stock market still have some effects on the so-called minds of existing stockholders, it was originally a good thing. I didn't expect the stock market to fall as soon as it was announced. The reason is that people think they need to expand, and once the expansion is done, will the stock price fail?


Originally, two reforms were here, one to promote the normal financing of the technology version, and the other to change the review system into a registration system. It is not only scientific innovation reform, but also the so-called system reform. In the end, I didn't expect that this good news would turn into a negative thing, which led to a fall. I guess that people have a process of understanding. This approach is right and not wrong. In fact, we are guaranteeing a so-called quality problem of listed companies. We liberalized the science and technology version and the registration system to improve the quality of listed companies and make it easier for good companies to go public. However, the short-term impression is that the expansion of capacity has caused the stock market to fall. This is no problem.


But there is one thing that can be seen that the decision makers have mentioned the stability of the stock market as an important agenda. This time it is very clear that the stock market must be stable. When the stock market is unstable, finance cannot be stabilized. Therefore, the next important part of stabilizing finance is to stabilize the stock market. The Shanghai policy announcement this time, I think it should be good news, but it turned out to be bad. Generally speaking, it is to stabilize the stock market. This is the fourth thing to do to stabilize the financial sector.


The fifth thing is to prevent asset bubbles from bursting and detonating the entire financial turmoil.


The meaning of this sentence is that real estate is a big problem. The key to the test of whether we can stabilize our finance next year is real estate. In the past, housing prices have risen rapidly, and we have a solution, mid-to-long-term countermeasures, as well as short- and medium-term countermeasures. But in case of a big drop, real estate can neither rise too fast nor fall too fast. If housing prices fall too fast, the bubble will burst, even if it bursts. This year, two types of financial institutions should be basically cleared out. One is a non-bank financial institution, and the reports have been completed. The second is that the stock market has fallen to its lowest point. In fact, diversified financial risks have exploded, not just systemic. There is also a banking financial institution in the system. The bank is fine now, and the non-bank financial institution and the stock market have been cleared. But the bank can't have an accident. If an accident occurs, the entire systemic financial risk will erupt. The premise that the bank can't have an accident is that the real estate can't have an accident, which is a major problem.


The most important problem we will encounter next year for financial stability may be the real estate problem. Recently, housing prices have begun to fall and Beijing's second-hand housing has returned to 2016 levels. If it falls further, to what extent can it stabilize the finance is worthy of our study. The main problem of financial stabilization next year is what to do with the sharp fall in housing prices. If housing prices fall sharply, you know that 65% of Chinese wealth is real estate, which means that everyone's wealth will shrink. Second, the trust relationship is now basically established on the basis of housing prices. Once a sharp drop will lead to the break of the entire credit loan, and now a lot of property and real estate, like listed companies, they control real estate at about 1 trillion, what will be the end of such a plunge? Next year, there will be a major pressure for us. The real estate issue may be the core of stabilizing finance. If this article can be stabilized and overcome this difficulty, the issue of financial stabilization in 2020 will be easier.


It now appears that the biggest problem in the next step is about real estate. Can we keep it steady? It won't work if housing prices rise too fast, but it won't work if prices fall too fast. In what state should be able to stabilize, it is worth studying in China. Judging from international experience, like the United States and Japan, you pay attention to studying them. Every time financial risks detonate, it is real estate. What was behind the last time the US detonated financial risks in 2008 was the subprime mortgage crisis. It was the real estate that detonated the entire financial crisis. An important next step for China is whether the real estate industry can be stabilized. If you can't stabilize it, it may be more troublesome. The core issue of financial stabilization next year is the real estate issue. Whether house prices can fall within the scope of what we need. And now it seems that some market problems are not as standard as we thought, and once there is a chain reaction, it will be very troublesome.


Beijing now has a headache, basically there is no market. The listed price is there, and the price must be reduced in the final transaction. Since March of this year, I have been on a 10-day shift in Beijing intermediary agencies, because you can’t just look at statistics, you have to experience it, and you have to observe what is going on with the mentality of buyers and sellers. I found that the total price of a house is 5 million yuan, there is still liquidity, and most of them are just needed. Tens of millions, the liquidity is very poor, one to three to 40 million is basically no liquidity. One day a gentleman wanted to sell a house on the edge of the Olympic Village. The area was relatively large. The listed price was 35 million. After half a year, no one asked, and he was very anxious. That day, I came to the intermediary agency by myself and happened to meet me to chat with him. He told me that no one had asked me and I was very anxious. As a result, two house inspectors came, and he told them with special enthusiasm that this was a fine decoration, and that he had not lived in, so he could move in with a bag. If you make a one-time payment, you can get a discount, how about 30 million. After listening to those two guys, there is a sentence, buddy, we are not missing the 500, but the 30 million!


This brings me to a problem. Who will take over the real estate? Think about it. It's a big problem. Next year, if housing prices fall too fast, some real estate policies, such as real estate taxes, will not be so anxious. Too anxious will accelerate the decline, and the accelerated decline will not be conducive to stability. Next year is the same as this year, some policies, like deleveraging policy, this year we find problems and adjust quickly. The real estate policy is the same, as soon as the asymmetry is found, it will be adjusted immediately. Both adjustment period and adjustment period must mean adjustment. There is no one who insists on it all the time. Once it is found to be wrong, it must be adjusted. The key to next year may be to stabilize, real estate is a major event. Only when the real estate is stable can the finance be stabilized. If it is not stable, finance will not be stable.


Those of you who have too many houses in this room should pay attention to it. I suggest that everyone pay attention to this issue, because market forces cannot be controlled. The key issue for next year is whether the real estate can be stabilized at the core of financial stabilization, which is a big question. If it can be stabilized, it should be said that finance can be stabilized. What is testing us this year is that non-bank financial institutions have basically detonated. The so-called irrational decline in the stock market, we feel that the key to next year's financial stability is the real estate issue. Generally speaking, the first thing we need to do is to stabilize our finances, which are roughly these five things. When these five things are done well, the finance can be stabilized and the adjustment period can be passed through. The financial situation cannot be stabilized, the adjustment period cannot be passed, and it is impossible to move towards a stage of high-quality growth.


The first thing is that this is the general situation of financial stabilization.


I just mentioned that China has entered an adjustment period. Three things must be done during the adjustment period. First, stabilize finance; second, stabilize growth; third, stabilize opening up.


There should not be too many declines in growth. Once too many declines occur, it may affect the mood of the entire society.


How to stabilize growth? In general, we need to do a few things. First, fiscal policy should be more proactive, because monetary policy has to guard against risks just now, and its operating space is limited. If it cannot change the trend of monetary policy, it is prudent. Neutral, can't move towards loose. In this way, an important policy for stabilizing growth is fiscal policy, which is more proactive. There are only two ways to make fiscal policy more proactive:


One is to reduce taxes and fees, and taxes and fees must be reduced. Last time we cut taxes, the reduction was reduced, but there was a problem with the last tax cut. All real estate companies reduced taxes by a quarter, but manufacturing companies did not. Everyone has a lot of opinions. On the one hand, there is no feeling of reducing so many taxes. Because of operational problems, real estate companies have basically reduced taxes by a quarter. You ask them and they are very happy. However, the manufacturing industry has basically not decreased, so a lesson must be learned. As you know, a document is being countersigned recently, and the three levels of value-added tax are now ready to be combined into two levels, and the group will drop by 1 point. One point, after the two taxes are combined, it should be quite big at one point. The introduction of this document will have too much impact. Yesterday the tax commissioner had a meeting to discuss, and they are discussing a larger tax cut and major adjustments to the value-added tax. In this way, it may be beneficial for companies to reduce taxes. I guess this time it may be relatively large, and all companies will feel that the tax reduction is true. Unlike in the past, only the State Council felt tax cuts, and no one felt it. Because the tax policy in September was only 6%, which was lower than GDP growth. It has not been reduced in the direction that should be reduced. This time the tax reduction may be relatively large. This is one. Fees, this time the so-called "three insurances and one housing fund" or the "five insurances and one housing fund" have been reduced. This is clear.


Although everyone knows that our collection agency has changed, there will be no increase in taxes and fees, but will decrease. Tax reduction and exemption will be officially announced at the economic work conference in the future. An important change is the tax reduction, which should make everyone feel the tax reduction. One of the proactive ways of fiscal policy is to reduce taxes and fees, and this time it will be more aggressive, so that everyone feels that taxes and fees are really reduced. The second method is to increase fiscal investment. Fiscal investment cannot be used for business investment, but only for infrastructure and people's livelihood. Investment in infrastructure and people's livelihood will be further increased this year, and may also be further increased next year. Investment in infrastructure construction and investment in people's livelihood will be relatively large in the national budget next year, which can increase the stimulus effect of the entire social investment on the economy. In the first half of next year, one is to cut taxes and the other is to increase fiscal investment. These two actions will have a strong significance for stabilizing growth. Because it is no longer enough to not do it, it must be done. This is a way of stabilizing growth, and fiscal policy will be more proactive. Recently, decision-makers have been investigating and discussing, and issues involving all levels are being discussed. Financial conferences should announce these major decisions. In terms of stabilizing growth next year, fiscal policy will have a great effect.


The second is to speed up structural adjustment. Structural adjustment must be accelerated. The three industries we foresee must accelerate. The first is a strategic emerging industry, eight points, new energy, new materials, life bioengineering, energy conservation and environmental protection, information technology and mobile Internet, new energy vehicles, artificial intelligence, high-end equipment manufacturing, these eight points must be accelerated. In the process of advancing, on the one hand, it will release market power, and on the other hand, it will accelerate the state's support and promotion of these industries. Like artificial intelligence, China will stand in the world's first team in the future. As long as these companies are doing well in the market, the state can use the money to invest and withdraw to a certain extent to complete this stage. For example, Tencent’s medical imaging is good, and it’s really good. What should we do? The state will increase investment. Now Tencent's technology can clearly take pictures of people's internal organs, and you will not necessarily see a doctor in future visits. It turns out that we estimated that HKUST iFLYTEK would make a breakthrough in voice artificial intelligence, but as a result, there are too many negative things recently. In fact, it has made great progress in these areas, and it will find ways to promote it as soon as possible. For those who have seen technological breakthroughs in these areas, the country should push it again so that it can complete these directions as much as possible and achieve the rapid development of strategic emerging industries.


I took a look recently and found that these aspects have indeed made great progress. On these points, I ran a company separately, and ran a total of 8 companies. I found that in this respect, there has been a lot of progress in the past few years. I estimate that in about three years, some companies will often emerge from these eight key points, which may release strong growth potential. To accelerate the promotion of strategic emerging industries, we cannot wait any longer. It is necessary to shorten this adjustment period as much as possible and let them release a strong effect as much as possible.


The service industry must accelerate its advancement as soon as possible.


I saw a teacher a few months ago. He is 91 years old. I am his first graduate student and a big disciple. I don't know me anymore. When I met, I asked who I am. After two minutes, I asked who you are. His son told me that the old man had an elderly patient with amnesia. Tell me that I hired three babysitters, and finally found out that the three babysitters tied the old man to a chair to play by themselves. I thought about the importance of institutional care. When I was studying in Japan, my counselor’s mother was an elderly patient with amnesia at the age of 75 and died at the age of 90. Where did I live for 15 years, and I live in a nursery in Japan. There are two very large institutions in Japan, one is a kindergarten and the other is a nursery school. He once led me to see his mother, and I only learned that her mother spent 15 years in the nursery and she had spent very happy time. Why, its care for the elderly is very detailed, one of which is the department for the elderly with amnesia, and these people live. I took a look at it, and the deputy minister told me that the minimum number of people who are treated here for amnesia patients must have graduated from the Department of Psychology at a university, otherwise they cannot be treated here. Because these people often talk about inexplicable things, they must deal with them correctly.


He told a story. He just came out of the office one day and ran into an elderly patient with amnesia. He said he won the big prize, 200 million. He immediately said that he knew that he had won two hundred million and what the number was. He told the old man that the two hundred million were in the bank and what the password was. As a result, the patient is very happy. If not, he will smash something, so he has to deal with it. These people are bored every evening and make up stories every evening. One day at noon, the news broadcast a news that the Japanese Prime Minister was coming to their city. They announced a news in the evening. Today, the Japanese Prime Minister was going to see everyone. As a result, everyone went to bed early, and finally forgot about it the next day. Sometimes they don't want to get an injection, but the doctor told them that the hospital was founded by them and they had to experience it by themselves, but they queued up to get the injection.


These industries have high value, and the returns must be high. The United States begins to pay pension funds as soon as they are employed, and what I have to fight for all my life is for the future. China has entered an aging society, and Vice Premier Liu He was right to say that China’s entry into an aging society has brought a very important demand, demand for the elderly, and a huge market. Now we are discussing that the market guarantee system is what the government should do, and pension is an industry, not pension security, it is an industry issue. These services are in huge demand, and I suggest that everyone must pay attention to these service industries. I guess like the service industry, no matter what kind of service industry has a great future in China, because it is based on population. There are nearly 1.4 billion people in China, so the service industry market will have a huge contribution to growth in China in the future.


There are two types of modern manufacturing. One is called traditional manufacturing. How to divide it depends on who is modern and who is not. It is classified according to the social nature of the products produced, and all private products are called traditional manufacturing. Why is the automobile classified as a traditional manufacturing industry, because it produces private products. All the production of public goods is called modern manufacturing. It is not who is modern or who is not, but is divided according to the nature of society. There is a serious surplus of private products in our country, a serious surplus of food, clothing and housing, and a serious surplus of traditional products. There is a serious shortage of public goods production, so the production of public goods is a vigorous development direction, the development of modern manufacturing. How to develop? Five key points have been set. First, aerospace manufacturing and aviation manufacturing. Aerospace instruments are satellites, and aircraft are large planes. The second is high-speed rail equipment manufacturing, which is a key point. The Chinese market is huge and all technological innovations have been completed. The third is nuclear power equipment manufacturing. The future development focus of China's new energy plants is nuclear power. 33% of the total power generation in 2030 will come from nuclear power, and nuclear power equipment is an important content. The fourth is the manufacturing of UHV power transmission and transformation equipment. China is now preparing to transform China's power grid to use UHV technology. The so-called UHV technology transmits electric energy to 5,000 kilometers away, and power transmission highways and UHV transmission and transformation equipment are listed as the focus. Fifth, modern shipbuilding and marine equipment manufacturing. China wants to build a world-class ocean-going navy, and supporting the important industrial sector of the ocean-going navy is modern shipbuilding.


Generally speaking, these five key points have now been set, and the promotion must be accelerated. Once started, the contribution to our growth is huge. Now we can see that the acceleration of structural adjustment is mainly in these three industries, one is the strategic emerging industry; the other is the service industry; the other is the modern manufacturing industry. As a result, some private enterprises in the last discussion asked that they seemed to be unable to do anything except the service industry. Wrong, in fact, in the recent discussion of state-owned and private-owned enterprises, there are two characteristics that are obvious in the future in the industrial structure. One is a basic industry, which should be completed by state-owned enterprises. For example, it is non-competitive, the investment is very long, the time is very long, such as the large aircraft engine, the individual cannot invest, the rate of return will not come back, and I don't know when it will succeed. Basic industries and heavy machinery have a long investment period and should be done by state-owned enterprises. The second is to realize the so-called division of labor between private and state-owned enterprises. This is the future direction of the so-called modern manufacturing industry is division of labor. There are more than 6 million parts and components for an aircraft, can't you engage in the production of one part? In the future, it must move towards division of labor and cooperation. For example, Shanghai Sangong Group does one thing, design and assembly, all parts are purchased through bidding. With so many parts for the high-speed rail, except for the chassis that is controlled by CRRC, everything else is tendered. You can't get one over!


In the future, the important division of labor between private and state-owned enterprises is that, in the first aspect, the country may mainly focus on basic industries or industries with heavy investment, while the private economy will focus on so-called consumer products. Division of labor and coordination, the completion and promotion of parts and components. In this way, the layout of private and state-owned industries will become clearer and clearer, and everyone has something to do. It's not that there is nothing to do, many have things to do. Think about it, shipbuilding involves so many industries, you can't make a spare part! I am a student, and she provides spare parts for modern ships. For a female student to run such a heavy enterprise, it is the matching of parts and components, and the division of labor and cooperation. In the future, private and state-owned industries will divide labor and achieve division of labor within the same industry, and each will give play to its own advantages and expertise to promote development.


In the next step, we should accelerate the promotion of these three industries, which will be of great significance. I estimate that China will shorten the period of structural adjustment, and may further shorten this process in terms of policy and financial support in the next step, and try to promote structural adjustment as soon as possible to allow industries that have grown through China's economic growth to be listed as soon as possible. The State Council held several symposiums this time, but it actually wanted to accelerate the shortening of the adjustment period. Only shortening the adjustment period is meaningful for stabilizing growth, and China has understood that it is now in a very advantageous position in the world industrial chain. Now such developed countries are engaged in the creative economy. After a long time, I found that creativity can only be implemented in China. For example, the United States can't do anything at Apple, but it has become popular in China, because all supporting departments have it. We are one level higher than developing countries, and the entire industrial chain is in an advantageous position. Therefore, we must accelerate structural adjustment. This is the second thing to stabilize growth.


The third thing is technological innovation. An important constraint on shortcomings is technology. We have no choice but to toss a chip. Everyone knows that our annual cost of importing chips is 400 billion U.S. dollars, which is the same as importing oil. Our biggest shortcoming is technology, and technological innovation must be accelerated. And don't shout slogans anymore, do it steadily. You should understand what the company wants to do and what the country wants to do. It must be clear. An important platform for technological innovation is to have modern laboratories. Without modern laboratories, no one can engage in financial innovation. That is not a slogan. A very important platform is a modern laboratory. Without this modern laboratory, no one can do it. This cannot be done by enterprises, the state must take action and establish a modern laboratory system to serve enterprises.


Recently, this action has begun. Beijing will build three major science cities, the Global Science City, the Future Science City, and the Zhongguancun Science City. After completion, they will be open to all private enterprises. The platform cannot engage in technological innovation, and there is no place for experimentation. This place is provided by the state, and the so-called laboratory economy can be built. Hangzhou has also established West Lake University. West Lake University only engages in three majors, bio-life engineering, artificial intelligence, and the Internet. It does not engage in other majors, starting with a doctorate. The important thing about a Ph.D. is the laboratory. How can you do a Ph.D. without a laboratory. The Ph.D. works in the laboratory all day, and your job is to raise bacteria, otherwise how to do life engineering. In addition to Zhejiang University, Alibaba is also engaged in laboratories. Without a platform, no private enterprise can engage in technological innovation.


For pharmaceutical companies, the state must provide a large number of laboratories to serve the country. Some companies do experiments here for free, but ultimately they mainly provide services. This kind of technological innovation must be accelerated. The reason for the strong technological innovation in the United States is that there is a huge laboratory economy, which provides a platform for the entire society. This kind of experimental economy can be used by you to win various Nobel Prizes. We don't have such a platform, the country must be formed. Now the thinking is basically clear, and efforts in this area have been shown in almost three to five years. Therefore, it is a very important part to increase the promotion of technological innovation.


The fourth thing is that reforms must be deepened. Moreover, the current reforms have been in place for 40 years, and it cannot be done like in the past. It must be reformed on the basis of 40 years of reforms. The reform of the private economy must be accelerated. If the personal safety and property safety of the private economy are not guaranteed, what can we do? In the past, everyone was a proletarian and there was nothing. Now so many people have become property owners. Of course, they are worried about their own property and personal safety. Then you must solve the problems of private enterprises. This is an important reform. If their personal safety and property safety are not guaranteed, they have all emigrated, so how can they engage in economic activities?


Of course, don't emigrate. Immigration is meaningless. In the end, you will find that China can make money and must ensure safety. The biggest problem in China is to ensure private property and personal safety. I estimate that the next step will be more meaningful for the personal safety and wealth security of the private economy. Three things must be done: First, all institutions that do not have judicial powers cannot seize private property, and must conduct strict identification. The second is that even judicial institutions cannot arbitrarily seal up, and the standard of filing a case should be adopted to limit the abuse of power by judicial institutions. The third is the separation of justice and administration. The judicial system and administration must be separated. Without separation, it is difficult to guarantee property.


We should do these things under current conditions to truly ensure personal safety and property safety. He knows how to make money. You don't want to teach him how to make money. Just do these things. Guaranteeing property and personal safety is the most important thing. The reason why people are always worried about property and personal safety, especially when they have money, is even more worried, so it should be promoted. In the future, we must ensure the corporate class and emphasize the spirit of enterprise. This is the key. China's important political reforms should form a real commercial society. The so-called entrepreneurial class and entrepreneurial spirit have become the mainstream of this society. This reform is the most important reform. I estimate that if this reform can be done well, it will be meaningful for the next development.


Now we call reform and opening up and set sail again, which means that it is not the past reforms, but 40 years of technology, and then set sail. Recently, you see that we used to commemorate 40 years of reform and opening up, but now it is called celebration. To commemorate means to end, and to celebrate is to continue. Recently, the central government will hold a meeting to celebrate the 40th anniversary of reform and opening up, and to set sail for reform and opening up is to launch some major decisions. On the one hand, summarizing the past 40 years, on the other hand, we must look forward to the next 30 years. The commemoration is that this matter has passed, and the celebration means that it will be carried out, so it will further promote the reform.


Recently, private enterprises have always talked about six points, and they are most concerned about personal safety and wealth safety. Because they will know how to make money, as long as their personal and property safety is guaranteed. If this article is to be implemented in law, it must be implemented. Now the "Criminal Law" and "Civil Law" have made specific provisions, and many people have not read it. The "General Principles of the Civil Law" was passed by the two sessions last year, and it contains clear content on property protection. The next step is to create an atmosphere for the entire society to ensure the personal safety and property safety of private enterprises. This is the sixth and the most critical one mentioned by the leaders, which requires further reform and improvement.


China's reforms will be further promoted and will not stop. Moreover, China's reform is economic reform, and some of its content is political reform. Recognizing that the private economy is reasonable is political reform. Leaders have been talking about "one's own person." In the past, they called you a friend. Friends who are not their own, must become their own. Because you are an important part of Chinese society, no longer looking at it separately, it shows that this reform has actually initiated a political reform. I estimate that in the next step, China will further amend the Criminal Law, the Constitution, and the Civil Law, and gradually improve this protection. This will be meaningful for enhancing confidence and ensuring people’s motivation to create wealth. In this regard, this time is a major policy adjustment. There have been new adjustments in the formulation of the private economy. The next step is to turn the leaders' speech into a law and a system.


Recently, various departments have to move, such as high law, high prosecution, etc., to comprehensively adjust the overall legal system. Anything that is not suitable for the spirit of speech has to be revised and adjusted. The reform will be further deepened, which is of great significance for stabilizing growth. The focus of China's current reforms is on the private economy, which is the most concerned issue. The core issue of the private economy is not how to ensure that they make money, but that the protection of personal and property is important, and they know how to make money. If these gradually become systems and laws, they will be meaningful to China's long-term stability.


The so-called steady growth is just these four things, and they have already begun to do so. After a year of hard work, we finally realized that this would be a good direction. These are the four things for steady growth. To ensure that the growth rate is at a normal growth rate, China's growth cannot be restored to 7% or 8%. The foundation is too large. It was 7 trillion 20 years ago and 27 trillion 10 years ago. That growth was only a little bit. Now it is 82 trillion, which is a big increase of 1 point. Don't think about seven or eight percent, a requirement that can roughly be met is not bad. In addition, it is not bad that China's growth rate can be maintained at 5%. To stabilize growth, we will gradually do these four things, which will be beneficial to ensuring future growth.


This is the second thing we need to do during the adjustment period to stabilize growth.


The third thing is to be steady and open.


Opening up must continue. What should we do about opening up? There are three major issues. One is to properly handle the relationship with the United States, and the relationship with the United States must be handled properly. The Sino-US trade war marked a readjustment of Sino-US relations. In the past, Sino-US relations could no longer be maintained in the future. We must have a bottom in our hearts. Some will continue to keep a low profile and what to do if they can’t. In the past, I used to pretend to be grandchildren. It used to be 1 meter high, but now it has grown to 1.8 meters. How to pretend. In the past, it was either grandson or grandson, but now it’s impossible to pretend. What should I do? In this era, I have to deal with it. Knowing that Sino-US relations must be adjusted, it is impossible to free ride like in the past. The Sino-US trade war is not a trade war. It is actually a historic and landmark event in the readjustment of Sino-US relations. It is an event that indicates that Sino-US relations will be readjusted.


China must do a good job, never make strategic mistakes, and must figure it out. In the evaluation of presidents in the United States, the third best president turned out to be Reagan. I was surprised. Reagan became one of the best presidents. He killed Japan and the former Soviet Union during his reign. To engage in an arms match with the Soviet Union, it is inevitable to develop heavy force. To engage in heavy use of force, three types of people must be raised: scientists, writers, and political elites. A dual-track system and a special supply system are implemented. These three kinds of people practiced special confession, and there was time, and the people had nothing. The result turned into a political problem and it was over overnight. Russia has lost the possibility of competing with the United States as it is now, and both of its competitors have been killed because of strategic mistakes. After the signing of the "Plaza Agreement" at that time, Japan turned to stimulate domestic demand and provide domestic demand. Germany is continuing to improve its supply capacity and technological innovation. Germany has survived, and Japan is doomed. Strategic mistakes.


China must ensure a very clear definition in the face of a trade war. China must adhere to three principles in handling Sino-US relations. The first is to protect China's core economic interests, and core interests cannot be given up. We don’t talk about politics. We talk about the South China Sea and Taiwan. The core economic interests must be protected. The core economic interests mean that China is currently in the best position in the entire world industrial chain. This is the core position. For developed countries and developing countries, China can do it. This is one of the most important core interests.


China must protect the best position in the world's industrial chain and must not make any mistakes. Second, when the United States criticizes China's trade politics, some of its suggestions are correct, and we must reform ourselves in accordance with the suggestions. Reform internally through their criticisms and stimulate us to reform. In the trade war, the United States is correct in some of its statements. For example, we are engaged in various export subsidies and state-owned economic subsidies are correct. We should reform. They promote China's internal reforms through trade wars with us. We must reform the right things, so we should promote internal reforms through external trade wars. Third, we cannot move towards the Cold War. China must draw closer relations with the United States. Trump works with us, and he can get closer with the American business community and the local governments of the United States. It is the principle that we cannot move towards Sino-US confrontation and cannot move towards the Cold War. China must take the initiative to continue to hug the United States. The more you fight, the more we hold you.


In fact, China has been a pity strategically in the past. In the US economic crisis in 2008, we should give money to these companies and become shareholders of these companies in the United States. We did not lend the money to the US government. The US government saved the business, and now the trouble is out. We borrowed more than 1 trillion from the United States. Don't lend to the US government, just lend to American companies. We become shareholders. We were still a little nervous at the time, we should not hug each other, we should hug each other closely. This time, 180 American companies came to the Shanghai International Import Expo. Last time they imposed tariffs on China, a tariff of 25% was added to 200 billion yuan. Even if the companies opposed it, the increase was 10%. They have interests, not others. Never enter a state of cold war with the United States, and must increase communication with American companies and local governments in the United States, and do not move toward a cold war. China must not listen to the words of some extremists, and should not move toward Sino-US confrontation. This is an exercise. We also continue to increase communication among cities, and we must pay attention to this issue.


These three principles must be handled well in Sino-US relations and should not be changed because of the trade war. These three principles must be adhered to. The key to maintaining stability and opening up is to handle Sino-US relations well, and not to cause us to confront the United States directly because of the trade war, and not to go into confrontation. We must move towards further integration at all levels, because it is one of the most developed countries, and we must find ways to integrate. This is the so-called important issue of further stabilizing and opening up, and properly handling Sino-US relations. Don't think that there are other ideas about the trade war, but we must find a way to resolve Sino-US relations.


The United States is very difficult now. Don’t think that the United States is very good. The United States is even more difficult than us. When you go to the United States, it is clear that the middle class is uncomfortable in the United States, and blue-collar workers have not paid a penny for 20 years. Of the more than 300 million people in the United States, only more than 100 million have passports. Many people have never traveled abroad, and have gone to Canada and Mexico for a round trip. Last time I told an American friend, don’t look at Beijing and Shanghai in China, if you drive for an hour and take a look, it’s different. He said that an hour’s drive in New York and Washington is almost the same. U.S. Treasury bonds are 20 trillion U.S. dollars, which is equivalent to GDP. The total GDP of the United States in the first half of the year was a little over 10 trillion, and this year's debt is 21 trillion. The United States also needs help. It is good for China not to go into confrontation.


A stable and open one. After the outbreak of the Sino-US trade war, further handling of Sino-US relations is one.

Second, China must open its market in all directions. China can't just say that we are a big manufacturing country, but we have to add another, a big market country. As long as the market is here, where can you go. China cannot be a big manufacturing country. A big manufacturing country is a matter of exports and interests. The market power has trapped everyone and must open the market completely. We are positively opening up three markets:


One is to open up the material product market in an all-round way. Open in all directions and release several signals. One is to establish a permanent import expo in Shanghai; the other is to reduce tariffs; Hainan Island has become a free trade island as a whole. There are no tariffs. It will stimulate Chinese consumption in the short term. I took a look at the CIIE and found that so many good products are what we want. The price was too high in the past because the tariff was too high. Once the tariff is lowered, it will be cheaper immediately. I estimate that around the 15th is the cheapest, and all tariffs have been reduced, which will stimulate domestic consumption all at once. With so many good products coming in, the Chinese people are very capable of learning. Don't produce the same products in a few years. China is a big copycat country, and in the long run it will improve China's supply capacity. I recently visited the CIIE and found that many things have a very good effect on China. As long as they buy in, the Chinese have a strong learning ability and will soon increase China's supply level.


The second is to open up the service industry market in an all-round way. Finance, education, medical care, and insurance are all open. There seems to be a shortage of excellent education teachers in China. From your news, your excellent education teachers always want to get needles. We have 100,000 preschool teachers in the Philippines. They have excellent English skills and do not have needles. The opening of the Filipino domestic helper market is very fast. The service industry is open and people have to come in. Why is the State Council so anxious to set up an immigration bureau? These are all issues with the immigration bureau. The product is the issue of the customs, and the service industry is the issue of the Immigration Bureau. With the establishment of a new immigration office, we will open up the service industry market in all aspects.


The third is to open up the investment market in all directions. Recently, the State Council revised the negative list of foreign investment into China. The negative list originally contained 69 items, but now it has dropped to 42 items. Moreover, this time we have made adjustments to Sino-Japanese relations. Everyone has seen that China and Japan have officially proposed to transform from a competitive relationship to a cooperative relationship, and the two sides will jointly develop a third-party market. Japan actually has a very strong production capacity. Once the Southeast Asian market is opened up, it will be of great benefit to China. Recently, Japan has adjusted its relations and is pulling together to engage in third-party markets. The most important thing is to establish infrastructure in Southeast Asia and South Asia. China has now grabbed Japan in Asia, the West has grabbed the United States, and it has grabbed Germany and France in Africa. Just do it together. As long as we work together, China will win in the end, because the Chinese can endure hardship very much. You work there for four hours and then rest, we don’t need it, we are 12 hours. To open up the investment market, it is meaningful to reach an agreement with Japan this time. I guess it will take a few years to unite with Japan to level Southeast Asia and level South Asia, which will be of great significance to China.


We open up the market in all directions, and the three major markets are opened together, so that China can become a big market country, and finally can we truly move to the center of the world stage. And we have the ability to gradually get richer with 1.4 billion people, so China is right to open up the market in all directions. This is the second thing to do to stabilize opening up.

The third thing is to manage the "Belt and Road" strategy. The "One Belt, One Road" strategy involves three continents and two oceans, Asia, Europe, and Africa. Two oceans, the Pacific Ocean and the Indian Ocean. So watch out. The United States is in a hurry, blocking North America and the Atlantic Ocean to avoid direct conflict. China thought of this question five years ago. What if the United States does not allow Chinese products to pass, find new export destinations, and find new investment locations, so it drafted the "Belt and Road" strategy. Recently, China held a "Belt and Road" strategy seminar, turning "One Belt and One Road" into a real strategy, not a slogan.


At the national level, three things must be done well for the “Belt and Road” initiative. One is to do a good job in financial services, so we established the Asian Infrastructure Investment Bank. What is the purpose of the AIIB? To provide financial services for the “Belt and Road Initiative”; the second is infrastructure construction, to open up the infrastructure, otherwise how to export products, how to export enterprises; look at the Eurasian high-speed rail has been opened, and now we are eating seafood. From the Indian Ocean and the Pacific Ocean. The Indian Ocean and China are so close. China’s “One Belt, One Road” must pay attention. The “One Road” includes both the Indian Ocean and the Pacific Ocean. The Pacific is forgivable because it borders China. In the Pacific, we have limitations. The Strait of Malacca is a troublesome thing. The United States can completely blockade it. It doesn't matter to blockade it. We can go from the Indian Ocean. The third is legal services. We have established a new court, the "Belt and Road" court. The "Belt and Road" courts serve Chinese companies going out and help you fight international lawsuits because companies want to go out. For the country to manage the “Belt and Road” initiative, these three things must be done well: financial services, infrastructure, and legal services. Let Chinese enterprises go out, especially small and medium-sized enterprises going out, so we have to promote the small and medium-sized enterprises to move towards the "Belt and Road" to make sense.


This year I went to Africa for inspection and went to Morocco. Morocco does not have any industry, it is tourism, and it does not have any industry. The products I sell are made in China, so after I went there, a friend reminded me not to buy anything here. They are all made in China. Especially don't buy cultural relics, they are all Chinese. A celebrity insisted on buying it. He was very happy to buy something for 250,000, hung it at home and posted it on the Internet. As a result, a Guangdong company called and said it was made by them. If you transport the Chinese lathes, you can make money as soon as you start construction. Without any craftsmanship, you can make money as long as you produce them. Morocco is the main route for Europeans to Africa.


China has passed, so many companies have passed, Morocco’s tax is very light, just one kind of tax, income tax of 13%, no value-added tax. Moreover, the labor force is relatively cheap, and the labor force is unrestricted loyalty to you, as long as you give employment opportunities, you are very loyal to you. The Chinese labor force still wonders where the boss's money comes from. They never wonder, only work. The population of Africa has exploded, and there are many people without any industrial manufacturing. In fact, everyone should be careful not to mention the term "de-industrialization". Two countries in Africa, one Egypt and the other South Africa, are embarrassed of de-industrialization and cannot be mentioned casually. The reason why China is able to pass is that China's industrial sector is very complete, and it can pass anyway.


In the future of Africa, after 2050, the growth point of the entire world will be Africa, and Asia will be saturated in 2050. China will become a modern country in 2050. As soon as China saturates, the entire Asia will be saturated. The future growth point is Africa. Therefore, we are right to make arrangements in advance. The last time I met a person born in 1974, a young company has been engaged in thermal power plant projects in China, and now they are all saturated and they have no work to do. I finally saw a place in Turkey bidding to build a thermal power plant, and I was very happy. Bring the two vice presidents to fly there directly. After getting off the airport, they came out to find a car. They took the tender place to find a taxi. The taxis all shook their heads. Why? This place is more than 400 kilometers away from the airport, and no one wants to go. Finally found a car. Three people passed by. Just when they got out of the car, they found a seven or eight-year-old child rushing up with a big bag. They were very nervous, whether it was a human bomb. Why did you come here, because I have never seen a person with such a small nose, so I had to take a photo when I first met.


After winning the bid, the construction was very good, and now the local logistics and spare parts supporting facilities have all been won. China’s level of internationalization is actually very high. The “One Belt, One Road” strategy is very promising for many companies, especially small and medium-sized enterprises. Going out is not a big company, only a large number of small and medium-sized enterprises makes sense. China must manage the "One Belt, One Road" strategy, which is of great significance to the "going global" of many of China's excess production capacity and small and medium-sized enterprises. We are now gradually realizing this problem. Recently I read an article proving that there was no Silk Road in ancient China. Everyone knows that the "Belt and Road" is to find a reason, and it is hard to say that there is no reason. Because we had the Silk Road in ancient times, we launched a new Silk Road, called the "One Belt One Road". As a result, he insisted on demonstrating that there was no Silk Road!


We must operate well. This is the focus of China's next step. It has a large area, three continents, five oceans, Asia, Europe, Africa; the Indian Ocean, the Pacific Ocean, how big a range. This time, many countries recognized China's strategy, and Japan recognized the "Belt and Road" for the first time, and united with China to develop the "Belt and Road" third-party market. Russia also recognizes that the integration with the Eurasian strategy has gradually formed a consensus to pave the way for Chinese SMEs to go global. This is an important opening, so it is a new opening. We are not simply moving towards a new stage of opening up, so we have managed the “Belt and Road” initiative.


Generally speaking, the three things of the so-called stable opening up must be done well. One is Sino-US relations and the trade war must be handled well; the other is to open up the market in all directions so that the Chinese will become a big manufacturing country while also becoming a big world market country; 3. It is to manage the "One Belt, One Road" strategy and provide good services for Chinese products and enterprises to go out to complete our further opening up. If these three things are done well, China's opening up will enter a new stage. Opening up will, in turn, promote domestic growth and the transformation of national power. The more open it is, the more China’s concepts will change and the easier it will be to promote the growth of national power. Therefore, to stabilize opening up, we must do these three things well.


China's economy has entered a period of adjustment. We must do three things well, stabilize finance, stabilize growth, and stabilize openness. If these three things are done well, China will go through the three-year adjustment period and move towards the high-quality growth we hope. stage. It is not yet a high-quality growth stage, but an adjustment period. It is necessary to adjust from the previous stage to the high-quality growth stage. I am generally cautious and optimistic about the judgment of China's economy. The basis of optimism is prudence. Only by doing good things can I be optimistic, otherwise it is blind optimism. These things must be done well in order to move towards an optimistic goal.