Dialogue guests:
Wang Changlin, Executive Vice President of China Macroeconomic Research Institute.
Gu Xueming, Dean of International Trade and Economic Cooperation Research Institute of Ministry of Commerce
Mao Yanhua, researcher, Guangdong, Hong Kong and Macao Development Research Institute, Sun Yat-sen University
Moderator: Our reporter John Zhang.
Editor’s Note: The report of the 19th National Congress of the Communist Party of China clearly stated that Socialism with Chinese characteristics has entered a new era, which is a new historical orientation for China’s development. The report puts forward "building a modern economic system" for the first time, and points out that it is an urgent requirement to cross the barrier and a strategic goal for China’s development. At present, China’s economy has changed from a high-speed growth stage to a high-quality development stage. The strategic goal of economic development is to build a modern economic system, improve the total factor productivity and continuously improve the economic innovation and competitiveness on the basis of quality change, efficiency change and power change. In the new era of Socialism with Chinese characteristics, how should we understand and build a modern economic system? This edition specially invites relevant experts from the first batch of national high-end think tank pilot units to elaborate on this in depth.
Accurately grasp the stage changes of China’s economic development
Reporter: The report of the 19th National Congress of the Communist Party of China pointed out that China’s economy has shifted from a high-speed growth stage to a high-quality development stage, and it is in the key period of transforming the development mode, optimizing the economic structure and transforming the growth momentum. Since the 18th National Congress of the Communist Party of China, the CPC Central Committee with the Supreme Leader as the core has grasped the main contradictions and contradictions in economic and social development, and put forward the economic development into a new normal and an economic policy framework that adapts to it. The quality and efficiency of economic development have been continuously improved. Excuse me, experts, how to correctly understand and profoundly grasp the conclusion that China’s economy has shifted from a high-speed growth stage to a high-quality development stage?
Gu Xueming:From the development stage, China’s development stage from high-speed growth to high-quality development stage is mainly manifested in the following three aspects:
Developing quality instead of developing speed has become the top priority for future development. China’s economic development has entered a new normal, and the economic growth rate has shifted from high-speed growth to medium-high-speed growth. In this regard, we must adhere to the quality first and promote the quality change of economic development.
Economic benefit has become the main orientation of future development. Economic growth is the unity of speed, quality and benefit. In the future, while maintaining high-speed economic growth, we should pay more attention to improving the quality and efficiency of economic growth. For a long time, the outstanding problem in China’s economic development is the unreasonable economic structure, which leads to overcapacity, low industry efficiency and ineffective operation, especially the economic development has not effectively benefited people’s livelihood. Changing from a high-speed growth stage to a high-quality development stage is to rectify the ecological environment, pay more attention to the quality and efficiency of development, and pay more attention to filling the shortcomings of people’s livelihood. It is necessary to promote efficiency change, improve total factor productivity, and strive to accelerate the construction of an industrial system with coordinated development of real economy, scientific and technological innovation, modern finance and human resources.
The drive of scientific and technological innovation has become the main driving force for future growth. Since the reform and opening up, China has made great achievements, mainly because China has given full play to the comparative advantages of traditional elements. However, with the deepening of reform and opening up, the advantages of traditional production factors such as labor, land, resources and energy in terms of supply and price are weakening day by day. Take the labor cost as an example, from 2006— In 2015, the total wages of employees in urban units in China increased by 3.6 times in 10 years, and the average wage of manufacturing industry has been at a relatively high level. Therefore, in the new stage of development, we should take innovation as the main driving force of economic development, from relying mainly on factors and investment to relying mainly on innovation, so as to promote the dynamic change of economic development and continuously enhance China’s economic innovation and competitiveness.
Judging from the principal contradiction in our society, in the new era of Socialism with Chinese characteristics, the principal contradiction in our society has been transformed into the contradiction between the people’s growing need for a better life and the unbalanced development.
From the demand side, with the continuous advancement of industrialization, urbanization and informatization, China’s consumer demand has entered a new lane of rapid development. In 2016, the contribution rate of consumption to economic growth reached 64.6%. With the rapid expansion of consumption scale, the pace of consumption upgrading accelerated. China has stably solved the problem of food and clothing for more than one billion people, and the consumption level is changing from food and clothing to a comprehensive well-off society. People’s material and cultural needs began to divide and upgrade, and their demands in democracy, rule of law, fairness, justice, security and environment were growing day by day.
From the supply side, China’s social productivity level has improved significantly on the whole, and the social productivity has entered the forefront of the world in many aspects. The more prominent problem is that the development imbalance is insufficient, and the effective supply in some middle and high-end areas related to people’s livelihood consumption is insufficient, resulting in a serious problem of consumption outflow, and it is difficult to fully release the domestic consumption potential, which has become the main constraint factor for residents’ consumption upgrading. Therefore, it is necessary to solve the mismatch between supply and demand from both ends of supply and demand, especially to accelerate the structural reform of supply side and create good conditions and environment to meet the people’s growing needs for a better life.
Wang Changlin:After nearly 40 years of rapid development since the reform and opening up, China has bid farewell to the era of shortage economy and solved the contradiction of insufficient total output. The prominent contradiction facing economic development now is the contradiction between the people’s growing needs for a better life and the unbalanced development, which is concentrated in the following aspects: from the industrial system, the production capacity is generally surplus, but the supply of high-quality and cost-effective products, high-knowledge and technology-intensive products and basic public service products necessary for society is insufficient. At the same time, the real economy and the virtual economy are structurally unbalanced. From the perspective of investment, the accumulation rate of investment is high, but it is difficult to convert high savings into effective investment because of the lack of better investment projects. From the perspective of consumption, some people have the willingness to consume but the ability to pay is not strong, and some people have a certain ability to pay. However, due to the lack of public services and security, preventive savings are strong, and it is difficult to effectively release potential consumer demand. From the perspective of factor supply, China’s labor force, capital, technology and other factors are generally abundant, but the quality and structure of supply do not meet the needs of economic structure optimization and kinetic energy conversion, and there is excess capital but it cannot enter the real economy. These are the outstanding problems in China’s current economic system, which exist on both sides of supply and demand, but the main contradiction is that the quality and efficiency of the supply system do not adapt to the changes in demand. Therefore, we must unswervingly promote the structural reform of the supply side.
Mao Yanhua:Since the reform and opening up, China’s coastal areas have taken the lead in joining the global value chain division system and established industrial division of labor relations with developed countries by exerting their comparative advantages. Especially after joining the World Trade Organization, the integration of economic and trade rules has promoted the rapid development of China’s export-oriented economy. At present, China has become the world’s largest trading country, and its share in global manufacturing added value has increased from less than 4% in 1990 to more than 20% in 2014. However, in the global value chain trade, the developed economies led by the United States have occupied the high end of the global value chain and are in the position of leading innovation through the continuous deepening of the division of labor in the global value chain; The emerging economies, represented by China, are in the low-end and are in the position of applying technological innovation and service-oriented innovation.
Under this mode of international division of labor, China’s economy has made remarkable development achievements, and the level of productivity has been significantly improved, but the problem of insufficient imbalance in development has also been difficult to solve. With the sustained development of economy and the continuous improvement of people’s living standards, on the one hand, people no longer simply pursue the growth of cheap consumer goods, but pay more attention to the quality, technology and design connotation of products; On the other hand, people’s demands for leisure time, livable life and environmental quality have also increased significantly. In addition, due to the unbalanced growth model in the past, residents in some backward areas failed to fully enjoy the fruits of economic development, and their needs are exactly what needs to be solved in the next transformation of economic development model. Therefore, the transformation of China’s economy from a high-speed growth stage to a high-quality development stage is an inevitable change that adapts to the profound changes in the main contradictions in our society.
In addition, since the global financial crisis in 2008, global competition has entered the stage of value chain upgrading competition from the stage of value chain share innovation competition, and changed from the past physical capital competition to knowledge capital competition. Therefore, to conform to and lead the new trend of economic globalization and industrial revolution, we should accelerate the structural reform of the supply side, accelerate the implementation of the innovation-driven development strategy and accelerate the construction of a new open economic system, so as to realize the transformation of China’s economy from a high-speed growth stage to a high-quality development stage.
Put the focus of economic development on the real economy
Reporter: The report of the 19th National Congress of the Communist Party of China pointed out that to build a modern economic system, we must focus on the real economy, take improving the quality of the supply system as the main direction, and significantly enhance China’s economic quality advantage. How to better focus on the real economy and enhance China’s economic quality advantage?
Gu Xueming:In July 2013, when General Secretary of the Supreme Leader inspected the reform and development work in Hubei, he emphasized that industry is the foundation of our country, and we should vigorously carry forward the spirit of self-reliance, develop and produce our own brand products, and form our own core competitiveness. In April 2017, General Secretary of the Supreme Leader stressed during his inspection work in Guangxi that China is a big country, and it is necessary to develop the real economy, constantly promote industrial modernization and improve the level of manufacturing, and we must not be divorced from reality. To better focus on the real economy, what is urgently needed is innovation drive.
The first is concept innovation. Firmly establish a new development concept of innovation, coordination, green, openness and sharing, deeply understand the position and role of the new development concept in leading the development of the real economy, and find new impetus for the development of the real economy from the new development concept.
The second is model innovation. Promote the transformation of development mode and development power, cultivate new development power of the real economy, promote the transformation of the development of the real economy from traditional cost dividend to talent, industry, technology and system dividend, promote the transformation of the development mode of the real economy to innovation, green and ecology, and realize the transformation and connection between the old and new modes and growth momentum.
The third is institutional innovation. From the institutional level, we will make efforts to form institutional arrangements conducive to the development of the real economy, and rely on the pioneering measures of open platforms and carriers such as the Pilot Free Trade Zone and the comprehensive pilot project of expanding and opening up the service industry to force the reform of the industrial and commercial registration system, the trade supervision system, the investment management system, the financial open innovation system and the post-event supervision system, continuously improve the level of liberalization and facilitation of trade and investment, and create a business environment that is more conducive to the development of the real economy.
The fourth is technological innovation. Relying on scientific and technological innovation and progress to improve the quality and efficiency of the real economy, we should not only develop high-tech and strategic emerging industries, but also use modern science and technology to transform and upgrade the development of traditional industries, and take networking, digitalization, green and intelligent manufacturing as the starting point to accelerate the formation of a number of new models and formats for the development of the real economy.
Wang Changlin:To complete the task of building a modern economic system, we must first fight the tough battle of supply-side structural reform and focus on three aspects:
It is necessary to start from the production end, effectively resolve excess capacity, promote industrial optimization and restructuring, reduce the cost of enterprises in the real economy, support the optimization and upgrading of traditional industries, accelerate the development and expansion of new kinetic energy, and build a modern industrial system; Efforts should be made to stimulate and protect entrepreneurship, enhance quality of enterprise, support the development of small and medium-sized enterprises, and optimize enterprise structure; It is necessary to adapt to the needs of economic development and transformation, enhance the supply capacity of key factors such as labor, finance and technology, and improve the efficiency of factor allocation. At the same time, efforts should be made to increase the supply of public goods and services, narrow the development gap between urban and rural areas and regions, intensify environmental governance, build an ecological security barrier, and fill outstanding shortcomings such as people’s livelihood and ecological civilization construction.
In the short term, the focus in the near future is to do a good job of de-capacity in industries such as steel and coal, and promote the market clearing of zombie enterprises. It is necessary to effectively reduce the cost of real enterprises, improve the efficiency and level of financial services to the real economy, and stimulate and protect entrepreneurship. We must seize the opportunity of the rapid development of the new round of scientific and technological revolution and industrial transformation, strengthen innovation, vigorously develop emerging industries, and accelerate the growth of new kinetic energy. In the long run, the fundamental way to revitalize the real economy lies in reform, and the key lies in innovation. It is necessary to establish and improve a long-term mechanism of market-oriented legalization to reduce production capacity, promote market-oriented reforms in the fields of finance, labor market, energy and electricity, increase investment in human capital, speed up the opening up of the service industry, and improve the access supervision mechanism for emerging industries, so as to reshape the competitive advantage of China’s real economy through reform and innovation.
Mao Yanhua: We should take three aspects as the breakthrough to deepen the reform: perfecting the negative list system of market access, promoting the reform of mixed ownership of state-owned enterprises and accelerating the transformation of government functions with "streamline administration, delegate power, strengthen regulation and improve services" as the core content;
By improving the negative list system of market access, we will form a market environment in which all kinds of market players use production factors equally according to law and participate in competition openly and fairly, and establish a unified, open and competitive modern market system; By promoting the reform of mixed ownership of state-owned enterprises, the function of state-owned capital will be enlarged, the value will be maintained and increased, and the competitiveness will be improved, thus forming the competitive advantage of the socialist basic economic system; At the same time, it is conducive to the complementarity, mutual promotion and common development of all kinds of ownership capital; Through the "streamline administration, delegate power, strengthen regulation and improve services" reform, we will create a fair and convenient market environment, reduce institutional transaction costs, fully mobilize the enthusiasm of market participants, and promote mass entrepreneurship and innovation.
Accelerate the construction of an innovative country
Reporter: The report of the 19th National Congress of the Communist Party of China pointed out that innovation is the first driving force for development and the strategic support for building a modern economic system. Throughout the history of human development, innovation has always been an important force in the development of a country and a nation, and it has always been an important force in promoting the progress of human society. What are your countermeasures and suggestions for strengthening innovation and self-confidence and accelerating the construction of an innovative country?
Gu Xueming:Building an innovative country is a long-term arduous task and a complex systematic project;
First of all, we should realize the important role of innovation in China’s future economic development and gather the strong joint efforts of the whole society to build an innovative country. In order to realize the problems and situation of China’s economic development entering the new normal, we must rely on scientific and technological innovation to effectively promote the industry to leap to the high end of the value chain and improve the economic quality; Only in this way can we cultivate more new competitive advantages facing the world and expand the development space; Only in this way can we effectively overcome the constraints of resources and environment and enhance the sustainability of development. It is necessary to continuously enhance the public’s awareness of innovation, take unified actions in the goals, directions and steps of building an innovative country, form a pattern of "thinking together and making efforts together" in the whole society, and unite the joint efforts of building an innovative country.
Secondly, it is necessary to further transform government functions and promote the transformation from "management innovation" to "guidance innovation" and "service innovation". We should further simplify administration and decentralize power, make full use of market mechanism, and support Chinese enterprises to truly become the main body of technological innovation. It is necessary to establish and improve the policy system to promote technological innovation of enterprises, give more consideration to the needs of enterprises in the formulation of supporting policies, and encourage independent innovation of enterprises. At the same time, we should create a good legal and social environment, protect intellectual property rights, safeguard the interests of innovators and protect the enthusiasm of innovation.
Thirdly, we should expand international cooperation in the field of scientific and technological innovation. We should seize the opportunity of accelerating the flow and reorganization of global innovation resources and take openness as a new driving force for building an innovative country. Pay attention to various forms of international and regional scientific and technological exchanges and cooperation, and increase the utilization of global scientific and technological resources. It is necessary to further increase the introduction of high-level talents and technologies, and actively participate in international major scientific plans and major scientific projects; At the same time, it is necessary to support enterprises and scientific research institutions to establish R&D institutions overseas and obtain advanced innovation resources.
Finally, according to local conditions, we should promote the coordinated development of regional innovation and improve the overall innovation ability of the country. We need to see the differences in innovation ability between the eastern, central and western regions of China. The eastern region should play a leading role, catch up with and lead the new wave of scientific and technological revolution, and play a leading role in the construction of innovative fields such as network power, digital China and smart society. The central and western regions should combine technology introduction with independent innovation, on the basis of introduction, strengthen digestion, absorption and innovation, transform and upgrade traditional industries, enhance the ability of independent innovation and enhance the vitality of economic development.
Wang Changlin:The formation and perfection of innovation ability and innovation system, as well as major technological innovation, especially subversive innovation, is not a short-term task. It requires continuous and long-term accumulation of human capital and the improvement of various mechanisms, systems and policies, so it must be a protracted war. We must put innovation and development in a prominent position in the country’s economic development and focus on the following three aspects:
First, give priority to educational modernization, improve the innovation system and policy system, accelerate the construction of modern university system and modern scientific research institute system, strengthen the construction of soft environment such as intellectual property protection, market access and technical standards, and strive to create a good innovation and entrepreneurship ecology. Second, efforts should be made to strengthen basic research, implement a number of major scientific and technological projects that have a bearing on the overall situation and long-term development of the country, overcome a number of core technologies, common technologies and subversive technologies, and promote the transformation of scientific and technological development to pay more attention to quality and efficiency. Third, we should focus on revitalizing the real economy, support the innovation capacity building of enterprises, promote the in-depth development of mass entrepreneurship and innovation, improve the innovation policy system, and constantly fuel the engine of innovation for enterprises.
Mao Yanhua:According to the report of the 19th National Congress of the Communist Party of China, "a powerful, prosperous, democratic, civilized, harmonious and beautiful modern socialist country will be built in the middle of this century". An innovative country is the proper meaning of a modern power. Fundamentally speaking, participating in and leading international competition and cooperation in the 21st century depends on the ability of scientific and technological innovation. Accelerating the construction of an innovative country is also an important measure to change the mode of economic development and conform to the changes in the main contradictions in our society.
At present, the state has invested heavily in scientific and technological innovation. In order to build an innovative country, we should not only maintain high investment, but also promote the innovation of scientific and technological innovation system and mechanism and open up many links of scientific and technological innovation. In the field of basic scientific research, the state needs to improve the relevant assessment mechanism of colleges and universities, and promote the combination of Industry-University-Research and the transformation of basic scientific research achievements; In terms of technological innovation of market players, the state should not only provide public services for small and medium-sized enterprises to stimulate the innovation vitality of emerging enterprises, but also learn from the R&D cooperation mechanism of enterprises in developed countries to solve the investment problem of common technology R&D of enterprises. In addition, the country also needs to apply scientific and technological innovation research and development achievements in a timely manner to feed back industrial development and government governance. For example, improving financial efficiency through information technology, transforming and upgrading the manufacturing industry through internet plus, and improving urban planning and social governance through big data.