A Proactive Fiscal Policy and Moderately Loose Monetary Policy

The characteristics of China's macroeconomic situation and policy analysis

Abstract: At present, China's economy is facing macroeconomic policy adjustment and transformation of economic development mode "double transformation" situation. Steady growth the focus of the country's economic policy is that efforts to seek a balance point between expansion policy and tightening of policy more and more obvious signs of an early end to the process of economic callback national ongoing steady growth policies in the pre-tune fine-tuning in a complex situation, the stabilization of overall economic growth stabilized., China to be more focused on economic transformation through the implementation of the bankruptcy system and rationalize the market pricing mechanism, strengthen debt management, risk prevention system adjustment and policy reform to speed up economic restructuring, China's economy has entered a new development trend.

Keywords: macroeconomic policy, economic development, fiscal policy, monetary policy, stabilized stabilized papers download

At present, China's economic situation is more complicated, and is facing a "double transformation": the first transition, adjustment and transformation of macroeconomic policy, the second transformation is the transformation of the mode of economic development., Jiangsu Sunan region was being significant practice. development pattern has an important impact on China's current development situation.

A double transformation: the characteristics of China's economic situation

(A) macroeconomic policy adjustment and transformation

China's macroeconomic policy performance, basically represents the main direction of China's macro-economic policies In 2007, China's GDP growth rate of 14.2% for fiscal policy and monetary policy, so the goal of macro-control is the "defense" --- prevent economic growth shifting from fast overheating, to prevent structural price increases from turning the overall inflation, the Central Economic Work Conference, held in December 2007, to determine the prudent fiscal policy and tight monetary policy, the macroeconomic policies The tone is appropriate to tighten the appropriate control.

1. A proactive fiscal policy and moderately loose monetary policy

Since the U.S. subprime mortgage crisis triggered a global financial crisis in 2007, China's external demand greater change: average annual growth rate of 29.2% from 2003 to 2007 China's exports to the fourth quarter of 2008, China's export growth declined to 4.2 exports dropped significantly means to spur economic growth in China "troika" of foreign demand that the export of this car "carriage" pulling power in substantially reduced. At this time, if it continues to maintain the original policy orientation, will be constrained domestic investment growth, coupled with domestic consumption, especially the demand to buy a house to take control measures may result in the growth rate of domestic demand also continued to fall, is likely to lead to a "troika" The deceleration may greater impact on economic growth by the fourth quarter of 2008, prior to the convening of the Central Economic Work Conference, the Political Bureau of the CPC Central Committee to take decisive measures, decided to implement the "package" plan.

Plans include the implementation of the proactive fiscal policy and moderately loose monetary policy from the macro-economic policy point of view, the "package" policies directional change compared with 2007, and that fiscal policy into a positive by robust monetary policy tight into the moderately loose. macroeconomic policies directional major adjustments in response to the international financial crisis, the impact has played a very important role.

The most obvious impact of the international financial crisis in 2009: China's export growth rate of 16% in 2009, total exports decreased from about 14 in 2008 to $ 30 billion to $ 01.6 billion, a net decrease of more than 2000 billion U.S. dollars, calculated in accordance with the exchange rate in 2009, equivalent to about 1.5 trillion yuan loss in export orders, according to the National Bureau of Statistics estimates the impact of the changes for 2009 GDP growth is -3.6 percent, that is, if there is no other policy adjustments, China's GDP growth in 2009 fell by 9.6% in 2008 to 6% or even lower because of the economic policy is to control the growth rate of domestic demand, external demand dropped significantly when domestic demand affected by the policy also fell, that growth in 2009, there may be reduced to less than 6%, which is a very serious impact on China's economy.

2. Potential crisis facing China's economic growth rate dropped

China's economy has been stressed not to place undue pursuit of high growth. Fact, from 2002 to the present, our growth rate has never fallen below 9%: 9.1% in 2002, reached 10% in 2003, after a growth rate of more than 10% has been keep to 2007, and in 2008 dropped to 9.6% from 9.2% in 2009, 10.4% in 2010, 9.3% in 2011, 10 years, never dropped to less than 9%. accompanied with the high-growth Chinese enterprises speed-type benefits, corporate profits and sales volume is closely related to sales expanded to promote profit growth Conversely, companies may loss our enterprise sales margin, sales profit of industrial enterprises in July this year, only 5.36% One of the reasons is less technological innovation, mainly through low-price competition of the product to achieve low-profit profit gains brought about by technological innovation The second reason is the high fixed costs, including the wages of retirees , depreciation of equipment, medical fees, especially state-owned enterprises, the wages of the hillock, not easy with the production and changes in the level of sales fluctuations. these expenses are fixed, there is no relationship between changes in sales when companies reduced because of market orders, decrease in sales while fixed costs remain unchanged, occurs loss. therefore, if excessive decline in the rate of economic growth, significantly reduced market demand, business got significantly reduced orders, which led to the decline in operating rates, many enterprises will enter a loss, resulting in numerous conflicts and problems.

The first is the problem of employment. Recent common "recruitment difficulties", "your job", the surface pressure on employment has become a thing of the past, in fact, keep the workforce stable a shift from quantity to quality. Enterprise losses and continue to continue when the enterprises are generally reluctant to past earnings constantly coming up, many companies will pull up stakes. enterprise meager profit, often choose to maintain production, to maintain a stable workforce, because if the dismissal of key posts the workers, and then culture is not easy to recruit new employees. enterprises are facing short-term difficulties, there is hope for the future, it will also stabilize the workforce, but, if the enterprises believe that the future prospects are worse, another loss pressure on might choose to withdraw, layoffs amount will increase when you quit, the unemployment problem will happen soon.

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