CAIJING Forum sheds light on the new engine for China's economy
Elites from political, industry and academic fields discuss sustainable economic recovery; international consulting firm releases authoritative industry reports
Beijing, April 15, 2008: Against the backdrop of the global economic slowdown, how can China’s economy avoid stepping into a W-curve scenario? As the revitalization plans for 10 key industries have been unveiled, which industries can play a leading role in the sustainable recovery of China’s economy?
On the morning of April 15th, CAIJING Forum “Seeking New Engine for China’s Economy” was held in Beijing in cooperation with Roland Berger Strategy Consultants. Top economists, government officials, entrepreneurs, and industry experts from Roland Berger, a leading international management consulting firm, shared their thoughts on new areas of growth to boost domestic demands in China’s economic transition process.
Mr. LIU Shijin, Deputy Director of the Development Research Center of the State Council, and Mr. SHEN Minggao, Chief Economist of CAIJING delivered keynote speeches at the outset of the forum, which is followed by discussions on the topics of “World and China’s Macro Economic Trends under the Financial Crisis” and “Transition of China’s Economic Growth Model under the Financial Crisis”.
On the first topic, Mr. FAN Jianping, Chief Economist of the State Information Center of China (SIC), Director of the Department of Economic Forecasting of SIC, Mr. WANG Tao, Chief Economist of UBS Securities, China , Mr. LIAN Ping, Chief Economist of Bank of Communications, Mr. SHEN Jianguang, Vice President of Research Department, Economist of CICC all put forward their insights on “When will the recession of the global economy bottom out?” ,“How can China achieve sustainable economic recovery?” and other relevant hot discussion topics.
On the second topic, Mr. Charles-Edouard BOUEE, President & Managing Partner - Greater China, Regional Coordinator - Asia of Roland Berger Strategy Consultants introduced the release of four industrial research reports covering auto, steel, petrochemical and real-estate industries, which are included or will be benefit from the recent announcement of the Revitalization Plans for 10 Key Industries by the State Council. These reports identify the opportunities and challenges for major industries in China in this time of crisis, and pinpoint the new engines for the sustainable development of China’s economy in the next 30 years.
The auto report reckons that the restructuring of China’s auto industry is a must, though in the financial crisis, China’s auto industry still has plenty of opportunities all along the value chain. In particular, Donfeng-Nissan, BYD, and other auto makers have not been affected by the financial turmoil and still enjoyed a high growth rate of sales and profits due to their excellence at distribution, sourcing, R&D and marketing strategy. The new front-runner of China’s auto industry is about to emerge from these “go-against-the-trend” auto makers.
The steel report analyzes the huge potential arising from the financial turbulence. The report says that China’s steel industry is in “relative over-supply”; however, if great efforts are put into R&D or international cooperation to move up the value chain by focusing on technologically-advanced products, there will be a prominent future for the steel sector.
With thorough study on the petrochemical industry, the report believes that SMEs in this industry, which are at the downstream of the industrial chain and enjoy R&D and technical advantages, as well as competitiveness in the global market, are likely to be the first to get out of trouble.
The real-estate report shows that standardized product offerings are the future trend of the industry. These will greatly improve product quality, shorten the construction cycle, and streamline management procedures, thereby laying a solid foundation for the further development of these companies. Jindi, Vanke and some other players in the market have already become leaders in this sector by understanding consumer behavior, product positioning, quality control and cost management.
The 27th “CAIJING Macro-economy Weekly Review” issued by the research department of “CAIJING” points out that the priority of the revitalization plan should be creating a favorable environment in which policies favor M&A and stimulate consumption to take major industries out of their difficulties.
Statistics reveals that industries related to these 10 key ones all suffer from similar overcapacity or idle capacity problems. Mr. Shen Minggao, Chief Economist of CAIJING, claims that overcapacity is due to the rapid suppression of demand in domestic and overseas markets. It is also linked to the cyclical nature of the industry. Sudden breaks after many years of fast growth and insufficient demand are the major obstacles in the path to turnaround. As a result, China is in even more urgent need of a consumption stimulus plan. “The efforts to revitalize an industry actually go beyond the industry”, said Mr. Shen Minggao.
Mr. Charles-Edouard BOUEE, President & Managing Partner - Greater China, Regional Coordinator - Asia of Roland Berger Strategy Consultants said, "The financial crisis has exposed an already existing structural need for China to develop its own model. To achieve the long-term sustainable growth, the 10 revitalization plans will help to ignite the new engine to drive this growth, coupled with the energy provided by domestic consumption; long term reforms will finally upgrade current economic structure and improve the engineering and design of the new engine. "
Summary of Roland Berger Industry Report
(Auto, Steel, Petrochemical, Real-estate industry)
Beijing, April 15, 2008: Against the backdrop of the global economic slowdown, how can China’s economy avoid stepping into a W-curve scenario? As the revitalization plans for 10 key industries have been unveiled, which industries can play a leading role in the sustainable recovery of China’s economy?
On the morning of April 15th, CAIJING Forum “Seeking New Engine for China’s Economy” was held in Beijing in cooperation with Roland Berger Strategy Consultants. Top economists, government officials, entrepreneurs, and industry experts from Roland Berger, a leading international management consulting firm, shared their thoughts on new areas of growth to boost domestic demands in China’s economic transition process.
Mr. LIU Shijin, Deputy Director of the Development Research Center of the State Council, and Mr. SHEN Minggao, Chief Economist of CAIJING delivered keynote speeches at the outset of the forum, which is followed by discussions on the topics of “World and China’s Macro Economic Trends under the Financial Crisis” and “Transition of China’s Economic Growth Model under the Financial Crisis”.
On the first topic, Mr. FAN Jianping, Chief Economist of the State Information Center of China (SIC), Director of the Department of Economic Forecasting of SIC, Mr. WANG Tao, Chief Economist of UBS Securities, China , Mr. LIAN Ping, Chief Economist of Bank of Communications, Mr. SHEN Jianguang, Vice President of Research Department, Economist of CICC all put forward their insights on “When will the recession of the global economy bottom out?” ,“How can China achieve sustainable economic recovery?” and other relevant hot discussion topics.
On the second topic, Mr. Charles-Edouard BOUEE, President & Managing Partner - Greater China, Regional Coordinator - Asia of Roland Berger Strategy Consultants introduced the release of four industrial research reports covering auto, steel, petrochemical and real-estate industries, which are included or will be benefit from the recent announcement of the Revitalization Plans for 10 Key Industries by the State Council. These reports identify the opportunities and challenges for major industries in China in this time of crisis, and pinpoint the new engines for the sustainable development of China’s economy in the next 30 years.
The auto report reckons that the restructuring of China’s auto industry is a must, though in the financial crisis, China’s auto industry still has plenty of opportunities all along the value chain. In particular, Donfeng-Nissan, BYD, and other auto makers have not been affected by the financial turmoil and still enjoyed a high growth rate of sales and profits due to their excellence at distribution, sourcing, R&D and marketing strategy. The new front-runner of China’s auto industry is about to emerge from these “go-against-the-trend” auto makers.
The steel report analyzes the huge potential arising from the financial turbulence. The report says that China’s steel industry is in “relative over-supply”; however, if great efforts are put into R&D or international cooperation to move up the value chain by focusing on technologically-advanced products, there will be a prominent future for the steel sector.
With thorough study on the petrochemical industry, the report believes that SMEs in this industry, which are at the downstream of the industrial chain and enjoy R&D and technical advantages, as well as competitiveness in the global market, are likely to be the first to get out of trouble.
The real-estate report shows that standardized product offerings are the future trend of the industry. These will greatly improve product quality, shorten the construction cycle, and streamline management procedures, thereby laying a solid foundation for the further development of these companies. Jindi, Vanke and some other players in the market have already become leaders in this sector by understanding consumer behavior, product positioning, quality control and cost management.
The 27th “CAIJING Macro-economy Weekly Review” issued by the research department of “CAIJING” points out that the priority of the revitalization plan should be creating a favorable environment in which policies favor M&A and stimulate consumption to take major industries out of their difficulties.
Statistics reveals that industries related to these 10 key ones all suffer from similar overcapacity or idle capacity problems. Mr. Shen Minggao, Chief Economist of CAIJING, claims that overcapacity is due to the rapid suppression of demand in domestic and overseas markets. It is also linked to the cyclical nature of the industry. Sudden breaks after many years of fast growth and insufficient demand are the major obstacles in the path to turnaround. As a result, China is in even more urgent need of a consumption stimulus plan. “The efforts to revitalize an industry actually go beyond the industry”, said Mr. Shen Minggao.
Mr. Charles-Edouard BOUEE, President & Managing Partner - Greater China, Regional Coordinator - Asia of Roland Berger Strategy Consultants said, "The financial crisis has exposed an already existing structural need for China to develop its own model. To achieve the long-term sustainable growth, the 10 revitalization plans will help to ignite the new engine to drive this growth, coupled with the energy provided by domestic consumption; long term reforms will finally upgrade current economic structure and improve the engineering and design of the new engine. "
Summary of Roland Berger Industry Report
(Auto, Steel, Petrochemical, Real-estate industry)
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