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Amoy eliminate the backward production capacity is still effective to rely on market mechanisms - p by gfgegnnm hhbnmkl





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Amoy eliminate the backward production capacity is still effective to rely on market mechanisms - p by
Article Posted: 03/17/2011
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Amoy eliminate the backward production capacity is still effective to rely on market mechanisms - p


 
Business,Business News,Business Opportunities
What is "backward production capacity?" It is determined by the market, issued by the State Council and governments at all levels are often the views of guidance is necessary, but to truly effective elimination of backward production capacity surplus, only to rely on the market.

State Council recently issued "on the elimination of backward production capacity to further strengthen the work of the notice" to give full play to the role of laws and regulations and technical standards binding threshold effect, in electricity, coal, Steel , Cement, nonferrous metals, coke, Papermaking , Leather, printing and dyeing industry, eliminate backward production capacity.

In accordance with the current development model, China's economic development is sustainable and healthy development is quite problematic. The adjustment of economic structure, transform the development pattern is the urgent question of economic development and also a debate inside and outside and down the problem for several years, but with little success. Little innovation in China, emerging industries, enterprises rarely, of course, is very slow progress in economic restructuring, the reasons should be eliminated, however, the backward production capacity, inefficient or ineffective, the enterprise can not eliminated, is also an important reason, even more important reasons. Because the allocation of resources from the social point of view, emerging industries, enterprises are inefficient in the elimination of backward production capacity based on the emerging enterprise.

The State Department as state government, especially the most authoritative macro-control organs, regularly published industry guidance to the report, released behind the current excess capacity and should be eliminated and will be out of the industry, production capacity, which can help companies survive, business, guide the healthy development of the economy.

The State Council issued the "Notice", also means that China eliminate backward production capacity is about to start the actual work. "Notice" clearly established led by the Ministry of Industry, Development and Reform Commission, Ministry of Supervision, Ministry of Finance, China Banking Regulatory Commission, SERC 18 ministries, including the elimination of backward production capacity consisting of the work of inter-ministerial coordination mechanism, and with a strict market access, play a different price, increase the punishment three policy constraints, more importantly, is the central government to actively support the co-ordination to support the regions work out backward production capacity. Estimated that in this context, has orders from the government's state-owned enterprises, can be a considerable part of the backward production capacity out of swap, while the backward production capacity mostly take shelter among the state-owned enterprises.

However, we can not over-optimistic. National industrial policy put forward last year and eliminate backward production capacity surplus of steel, but the current domestic steel production continues unabated, the investment did not fall but rise. National Bureau of Statistics on the show in December last year, China's crude steel production was 1.537 million tons daily average, 1-2 months of this year, average daily production rose to 1.744 million tons. Out against the new standards, such as the current standard is 400 cubic meters out following blast furnace, then the business for more than 500 cubic meters on the new blast furnace. The results may be more completely out of the greater capacity.

This we need to look at those behind, and excess production capacity is also a loss of how to generate, especially those who have lagged behind, even the loss of the capacity of any surplus should invest in? This is inconsistent with the basic laws of market economics.

Excess losses behind those new capacity almost all government action or state-owned enterprises is, a region or a sector of its beneficial to the operation of its business is often subject to local protectionism or a field of power protection Even if the loss can be borne by the public finance. This last one of the most powerful, it can be afraid of loss. Therefore, sometimes state-owned enterprises is not subject to market rules.

In fact, if there is no sufficient market competition and the resulting signal to a society, what is "behind the industry?" What is "excess capacity" are hard to define. Labor-intensive Textile Industry, Shanghai is "backward", but may in Henan is not "backward." The iron and steel production is the country add up to "surplus", but how to determine which steel plant should be closed? Which should be retained? Maybe, there are a few good steel plant should continue to expand capacity too! After all, the so-called "backward production capacity" is not smart officials, experts and entrepreneurs to study and find people, but those who can not adapt to the market fully competitive industry.

Normal market, industry, business, the rise of production, development, competition, elimination, the decline is occurring every day. Issued by the State Council and governments at all levels are often the views of guidance is necessary, but to truly effective elimination of backward production capacity surplus, and only rely on the market, and the Government's primary responsibility is to build the market and regulating market order, not to put too much effort participate in the market which come in their own.

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