We often hear the media report “supply-side reform“, but we really don’t understand what it means. Today I will share with you an easy-to-understand explanation of “supply-side reform”.
First of all, from a literal understanding, the “supply side” is the supply side, and the corresponding side is the demand side. If there is demand, there will be supply. For example: Why do I want to open a Lanzhou beef noodle restaurant (supply), because you want Eating (needs), it’s that simple.
Why supply-side reform? First of all, let’s talk about a few phenomena. Every May 1st or 11th Golden Week, a large number of Chinese people go to Japan to buy toilet lids frantically; my country imports tens of billions of dollars of mobile phone chips from abroad every year, and billions of dollars of ballpoint pens from abroad every year. core. This shows a problem. The things made in our country can no longer meet the needs of the people, because the things made are not good, at least not as good as others. As a consumer, I will definitely choose high-quality and cheap products. Why so many people go to Japan to buy toilet seats, at least it shows that our own products are not as good as others. What is the name of the one who makes the product? Call the supply side, where is the problem? The problem is on the supply side. Therefore, we need to reform the supply side and strive to produce high-tech, high-quality, high-standard and technical-content products to meet people’s growing needs.
How can we manufacture high-tech, high-quality and high-standard products? The first point, the most important thing is to have scientific and technological research and development investment, that is, to have research and development funds, and a lot of funds are needed. So where has all the money in the market gone? As we all know, for more than 30 years of reform and opening up, real estate has always been my country’s economic pillar, driving the development of upstream and downstream industries such as cement, building materials, steel, home furnishing, and construction engineering. The configuration is extremely unreasonable. This will result in a waste of resources, so we need to find a way to redistribute so that more funds flow into high-tech industries, innovative enterprises, and small and medium-sized enterprises. Therefore, our country has put forward the specific implementation plan of “three eliminations, one reduction and one supplement”, de-capacity (reducing or closing high-polluting and high-energy-consuming enterprises, and reducing the inflow of a large amount of capital), de-stocking (removing the inventory of real estate, and providing new production capacity) space), deleveraging (reducing financial risks, compressing financial bubbles), reducing costs (improving efficiency), and making up for shortcomings (the shortcomings are high-tech industries and small and medium-sized innovative enterprises).
Therefore, the meaning of supply-side reform is so simple, and it is not so complicated to understand. If you like it, follow me.
