The development of real estate and stock markets in China should gradually go out of dependence on administrative regulation. Blind policy support and targeting are not desirable.It should be considered to learn from the experience of mature overseas markets and gradually improve real estate tax, corporate governance, and stock market dividend system.

Most of the current views on China's economy are more pessimistic. These views are based on the world's second largest economy. After the cancellation of the zero policy at the beginning of last year, no revenge rebound, real estate debt problem continued to deteriorate, currency tightening, and the stock market market.Pozo plunge and so on.Even though economic growth slightly exceeds the target value of about 5%set up early last year, many analysts believe that it is very difficult to maintain such a growth rate this year.

Looking at the world's competitors, the United States, India, Japan, Vietnam and other Chinese competitors seem to attract stronger international capital inflows.China ’s rapid economic growth in the past 40 years is basically carried out in periodic adjustment. Therefore, the current economic challenges have unprecedented, which has aroused the attention of all parties.Whether China's economy can avoid crisis and continue to become the engine of world economic growth, it will have a profound impact on future world development and pattern.

This economic transformation is different from the past

In China's official words, reform and opening up have always been an institutional motivation to promote China's economic growth, and international organizations such as the International Monetary Fund and the World Bank have also emphasized that the transformation and structural adjustment of growth models to the sustainable development of the Chinese economy canimportance.In recent years, with China's economic farewell to high -speed growth, reform and opening up have also entered the deep water area.The so -called deep -water zone means that almost all new adjustments may be painful and bring huge impact.The low -hanging fruit hanging on the branches has long been picked. To break through the middle income trap, it is necessary to promote huge market reforms.

Taking the real estate industry as an example, China is currently being promoted to have been delayed.China's economic growth, especially domestic demand, has rely on land auction and real estate development in the past 30 years. Real estate and decoration, furniture, home appliances and other related industries have previously been an important engine to promote China's economy, accounting for about a quarter of economic growth.However, the crazy rise of urban house prices and the total supply of housing that far exceeds demand have long overwhelmed China's economic potential and became one of the largest financial bubbles in the world.But how to squeeze this bubble and not cause the financial crisis to test the wisdom of the governor.Even in the United States with a relatively complete governance system, the subprime storms caused by real estate still led to the global financial crisis in 2008.

At present, the momentum of excessive rising housing prices has been obviously curbed, and the real estate industry has also given out the position of the economic main engine, but people's concerns have not been alleviated and have intensified.The reason is that the real estate industry has changed from sudden heat to sudden cold, and many real estate giants have defaulted. The Evergrande Group of Cosmic Real Estate Corporation has even been ordered by the Hong Kong court.The chain reactions and financial impacts that followed were unpredictable, and the real estate industry suddenly became a dragging factor in economics.

Economists generally believe that China should transform to the domestic demand economy, but the huge domestic demand supported by the real estate industry has fallen sharply in an instant.Instead of running.At present, although the rise of electric vehicles, domestic tourism and other industries has supported the growth of domestic demand to a certain extent, the volume of these economic sectors is not enough to make up for the gap in real estate, and the sharp shrinking of land finances gives.The daily expenditure of local governments has brought huge challenges, which largely curb the growth of local demand.

Can the Chinese economy be Phoenix Nirvana

This economic transformation is like a pain before childbirth. Without pain and cost, there is no new growth model. However, it also needs to have a grasp of pain tolerance to avoid systemic risks.The excessive depression of the real estate industry and the violent turbulence of the financial market not only seriously shake the confidence of investors at home and abroad, but also cause the enthusiasm of the general public to produce and consume, leading to the shrinking and economic stagnation of domestic demand.

The key to

China's economic transformation is to establish a strong market for domestic demand and fair competition, and these two points cannot be achieved overnight.The successful reform and opening up of China in the past is based on the gradualism of "crossing the river by touching the stones", which is significantly different from the "shock therapy" conducted by the Eastern European countries that year.At present, the resolution of the debt crisis also needs to be advanced steadily. Frozen three feet is not a day cold. The backlog of problems in the financial and real estate sector has been for a long time. During the digestion and solving, they also need a relatively long process.

The development of China's real estate and stock markets should gradually get out of dependence on administrative regulation. Blind policy support and targeting are not desirable.It should be considered to learn from the experience of mature overseas markets and gradually improve real estate tax, corporate governance, and stock market dividend system.

Although the real estate tax topic has been discussed in China for a long time, it cannot be implemented. This is an important reason for the foam out of control.With the total real estate supply that has risen to saturated, local finances can no longer rely on selling land to obtain income. At this time, you should consider restarting the real estate tax plan.However, considering the people's affordability, real estate tax can be levied at a lower level.

The pain caused by the reform of all deep water areas should be within the scope of the people. The current international political and economic situation is very unstable. The domestic debt crisis, employment pressure, aging aging, low fertility rate and other "gray rhinos"The concentrated outbreak of risks, while promoting structural reforms, taking into account risk management and the ability of the public will be the key to the Chinese economy realizing Phoenix Nirvana.

The author is the deputy director and senior researcher of the East Asian Research Institute of the National University of Singapore