Chen Liang of CICC: "Promoting stability through progress, establishing first and then breaking down" is an incremental reform

Editor's note: Recently, the Central Financial Work Conference and the Central Economic Work Conference have been held successively, and Securities Times Brokerage China has invited a group of senior managers of mainstream financial institutions to take financial services for the real economy as the starting point to deeply interpret the spirit of the meeting, and clear the fog and point out the direction for the healthy development of the whole industry and its institutions in 2024 and even in the longer period in the future. The guest invited in the first phase is Chen Liang, Secretary of the Party Committee and Chairman of CICC.

Recently, the Central Economic Work Conference was held in Beijing, which pointed out the direction for the focus of next year's economic work. Chen Liang, Secretary of the Party Committee and Chairman of CICC, talked about his understanding of some of the requirements and formulations in the meeting.

In Chen Liang's view, compared with "development is the last word", this meeting further emphasized the importance of "quality", and high-quality development is the foundation and key to solving all problems. Judging from the statement of the meeting, "promoting stability with progress, establishing first and then breaking" is actually an incremental reform idea. New quality productivity is the main development direction of scientific and technological innovation in the future, representing a higher level of total factor productivity.

"CICC will earnestly study and implement the spirit of the Central Economic Work Conference, and resolutely shoulder the historical responsibility and political responsibility of building a first-class investment bank. Chen Liang said.

Firmly follow the path of high-quality development

The meeting first mentioned "insisting on high-quality development as the last word in the new era", which was placed at the top of the five "musts". Chen Liang said that compared with "development is the last word", the meeting further emphasized the importance of "quality".

Chen Liang believes that in the overall layout of Chinese-style modernization, high-quality development is the primary task of building a modern socialist country in an all-round way. This further elevates the strategic thinking of "development is the last word" to the level of high-quality development, and further focuses on achieving Chinese-style modernization with high-quality development. "Taking high-quality development as the last word in the new era" is to take high-quality development as the fundamental orientation, lead all aspects of policies to work in the same direction, complement each other and coordinate, and jointly serve the overall situation of Chinese-style modernization.

The meeting emphasized "focusing on the central task of economic construction and the primary task of high-quality development". Chen Liang believes that this is the internal requirement of comprehensively deepening reform and opening up, facing the future, high-quality development is the foundation and key to solving all problems.

"Whether it is to deal with external security challenges in industrial and supply chains, or to coordinate and resolve internal risks such as real estate, local debt, and small and medium-sized financial institutions, only by unswervingly adhering to the central task of economic construction and comprehensively promoting high-quality development can the internal and external challenges and risks we face be effectively resolved. ”

"Promoting stability with progress, establishing first and then breaking" is an incremental reform idea

With regard to next year's economic work, on the basis of "seeking progress while maintaining stability" in the past, the meeting added specific requirements of "promoting stability through progress, first establishing and then breaking down." Chen Liang believes that this sends a more positive policy signal.

The meeting clearly called for "enhancing the consistency of macroeconomic policy orientation", "incorporating non-economic policies into the evaluation of macroeconomic policy orientation consistency", "strengthening coordination and linkage in policy implementation and amplifying the combination effect", "laying a good amount of advance and leaving redundancy in policy reserves", especially mentioning the issue of environmental protection and other policies and fiscal, monetary and other macro policies to strengthen coordination and cooperation, and the ultimate goal is to serve the central work of economic construction. The firmer the goal of economic "progress" and the clearer the signal of "progress", the more effectively we can achieve the three stable goals of "stabilizing expectations, stabilizing growth, and stabilizing employment".

Chen Liang said that while emphasizing stable growth, the meeting also continued to emphasize the improvement of the economic structure, which is the proper meaning of high-quality development. As for how to promote stable growth by adjusting the structure and increasing the quality, the strategic policy given by the central government is to "establish first and then break down", and clearly requires attention to grasping and handling the relationship between "speed and quality, macro data and micro feelings, economic development and improving people's livelihood, development and security", and overall planning for "expanding domestic demand and deepening supply-side structural reform", and coordinating "local debt risk resolution and stable development".

Chen Liang believes that from the perspective of the central government's expression, "first establish and then break" is actually an incremental reform idea. If the incremental ones are not erected, the stock will be broken first, and the structure seems to be optimized, but it is contrary to the central government's strategic policy of "promoting stability through progress" and is not conducive to achieving the goal of "three stability".

Leading the formation of new quality productivity with scientific and technological innovation

Chen Liang said that scientific and technological innovation ranks first in the work of the nine major congresses next year, and it is especially necessary to grasp the dialectical relationship of "promoting stability with progress" and "establishing first and then breaking". In the international context of anti-globalization, some countries are promoting the "return to the shore" and "friendly shore" of the industrial chain, and the security of the global industrial and supply chain is facing major challenges, which can easily lead to a decline in production efficiency and an increase in the inflation center. For a large manufacturing country like China, the above-mentioned security challenges highlight the urgency and necessity of implementing the innovation-driven development strategy, transforming the mode of economic development, and enhancing the endogenous power of the economy.

In terms of improving efficiency, the core is to "use disruptive technologies and cutting-edge technologies to give birth to new industries, new models, new kinetic energy, and develop new quality productivity". New quality productivity is the main development direction of scientific and technological innovation in the future, representing a higher level of total factor productivity. At present, the mainland's economy has shifted from a stage of rapid growth to a stage of high-quality development, and in order to achieve sustainable growth, it is necessary to rely on scientific and technological innovation to shape new advantages for development and transform scientific and technological innovation achievements into real productivity.

Chen Liang believes that in the future, the mainland should focus on developing the digital economy, accelerating the development of artificial intelligence, creating a number of strategic emerging industries such as biomedicine, commercial aerospace, and low-altitude economy, opening up new tracks for future industries such as quantum and life sciences, and widely applying digital intelligence technology and green technology to accelerate the transformation and upgrading of traditional industries.

Chen Liang said that giving full play to the advantages of economies of scale will help China accelerate scientific and technological innovation. Under the trend of de-globalization, economies of scale are the biggest bright spot of China's economy in the future, which is an advantage that other countries do not have. India's population is now roughly the same as China's, but its economy is much smaller, and the United States has a larger economy than China, but not as much as China's. What's more, China has more than 200 million people with higher education, more than India and the United States combined, ranking first in the world.

The important role of economies of scale in scientific and technological innovation is reflected in the relatively mature technological route, which is reflected in the fact that large economies are more capable of catching up and incremental innovation, and in the field of breakthrough innovation, it is not only reflected in the support of huge resources on the supply side, but also driven by huge consumption on the demand side. The Central Economic Work Conference clearly proposed to "focus on expanding domestic demand" and "forming a virtuous circle in which consumption and investment promote each other", which will help effectively transform the Chinese population and industrial scale into the scale advantage of final demand, and promote disruptive technology and cutting-edge technological innovation with a large market scale and system.

Chen Liang believes that scientific and technological innovation activities have strong positive externalities and need external financing support, and the capital market has a lot to do in supporting scientific and technological innovation. In recent years, from the establishment of the Science and Technology Innovation Board and the pilot registration system to the full implementation of the registration system, the institutional mechanism of the capital market to serve scientific and technological innovation has been continuously improved, and the multi-level market system such as the Science and Technology Innovation Board, the Growth Enterprise Market and the Beijing Stock Exchange has been further improved. The capital market has played an important role in promoting the formation of innovative capital, empowering the transformation of scientific and technological achievements, and smoothing the virtuous cycle of "technology-industry-finance".

Chen Liang said that the Central Financial Work Conference held at the end of October 2023 clearly put forward the goal of "better playing the role of the capital market hub", which is an important part of the implementation of the requirements of "developing new quality productivity". As a state-owned financial institution, CICC is encouraged and excited. In the future, CICC will focus on economic construction, serve the overall situation of high-quality development, give full play to its own advantages, accelerate the construction of a first-class investment bank, and make greater contributions to accelerating the formation of new quality productivity and doing a good job in science and technology finance, green finance, inclusive finance, pension finance and digital finance.

Shouldering the historical responsibility of building a first-class investment bank

Chen Liang gave a brief briefing on CICC's implementation of the spirit of the Central Economic Work Conference.

He said that after the convening of the Central Economic Work Conference, CICC immediately organized the study Xi comprehend the spirit of the meeting, and studied and deployed the implementation work in combination with the actual business of the company. On the one hand, the party committee of the company has done a good job in the demonstration of learning and Xi through the "first topic" study Xi and the special study Xi of the theoretical center group of the party committee, so as to promote the company to deeply study and Xi the spirit of the Central Economic Work Conference, and do a good job in the transmission of the spirit of the meeting from top to bottom, so that all cadres and employees can fully and systematically grasp the overall requirements, policy orientation and main tasks of the Party Central Committee for economic and financial work in the coming period, and promote the Xi of theoretical learning to go deeper and more practical and empower practice.

On the other hand, the company adheres to the implementation without stopping, focusing on the decision-making and deployment of the Party Central Committee on nine key aspects of economic work in 2024, firmly based on the company's main responsibilities and main business, and accurately grasping the positioning and force point in the overall situation of serving the economy.

First, it is necessary to focus on the "five major articles" of finance, give better play to the hub function of the capital market, unswervingly serve scientific and technological innovation and industrial upgrading, support the deepening of the reform of state-owned enterprises, the growth of private enterprises, and the development of specialized and special new enterprises, help the country achieve the "double carbon" goal, and continue to increase financial support for protecting and improving people's livelihood.

Second, we should insist on seeking progress while maintaining stability, promoting stability with progress, establishing first and then breaking down, do a good job in sorting out and summarizing the annual work in a timely manner, carefully study and judge the business objectives and business strategies for next year, forge ahead, work hard, resolutely shoulder the historical responsibility and political responsibility of building a first-class investment bank, continuously improve our core competitiveness, and strive to help build a strong country and the great cause of national rejuvenation with high-quality financial development.

Editor-in-charge: Gui Yanmin

Proofreader: Li Lingfeng