11 March 2016
Guangdong Keen on Reducing Unsold Homes
Guangdong Provincial People’s Government recently released its Supply-side Structural Reform Plan (2016-2018) (“the Plan”) and Action Plan on Supply-side Structural Reform and Capacity Cutting (2016-2018).
The Plan called for classification of "zombie companies", encouraging participation of non-state-owned capital in "zombie companies” restructuring and reorganisation as required by law; phasing out backward production capacity at a faster pace; eliminating absolutely excessive production capacity proactively; and promoting industrial relocation away from the Pearl River Delta region by launching the 13th Five-Year Plan for industrial park development in eastern, western and northern Guangdong to strengthen the overall layout of industrial relocation. The Plan also called for active participation in transportation, energy, telecommunications and public services and other major infrastructure projects in countries along the route of the Belt and Road, and accelerating a number of cooperation projects including the Zhuhai-Gwadar (Pakistan) twin ports.
The Plan stressed efforts be taken to clear up housing inventory, promoting the healthy development of the real estate industry; accelerate the acquisition of urban resident status by rural migrants, deepen the housing system reform, expand genuine demand for housing, match supply and demand, and gradually absorb the real estate inventory.
The Plan put forward advancing financial deleveraging effectively and promoting stable and healthy development of the financial sector. It also called for strengthening financial supervision, monitoring and early warning (systems), proactively reducing and managing various types of financial risk, resolving the local government debt effectively to forestall the occurrence of systemic financial risk on a regional scale.
The Plan also provided ground for implementing various policy measures to help businesses reduce costs, optimise production and operation environment; accelerate market-oriented price reform of resource products in order to reduce the cost of factors of production, improve the efficiency of resource allocation, reduce costs in business institutional transactions, workers’ wages, tax, social security, finance, factors of production and logistics.