【英语财经】中国经济改革正步入险境？ Are China’s economic reforms dying?

Let me speak plainly. I want China’s economic reforms to work. I want reforms because I want Beijing to succeed in building a strong and sustainable economy. A stagnating China is bad for everyone – for China, the region and the world.

But I am worried.

I am not a “China bear”. As someone who travels around China a lot, I have seen much of the change over the past two decades. Things have actually going pretty well for much of that period - certainly better than most other emerging economies. People remained optimistic about the future, about their kids' futures. Beijing’s policy makers are not gods, but neither are they idiots - and over time they’ve proven pretty good at making policy that works to raise living standards.

But I want to ask an honest, heartfelt question: how are the reforms which the Third Plenum of the 18th Party Congress going? The Third Plenum agenda was ambitious and broad. It was a decade-long project. And no one pretended it was going to be easy. Many of the problems it identified were very complex. Issues were intertwined, which meant that policy-makers had to be very co-ordinated, something they’re not been good at traditionally. And everyone knew there would be resistance. There is a huge amount of cheese out there which needs to be moved.

So how are the economic reforms going? I think there are three possible answers to this question.

First, it’s going well. This is the official line, but few people I know say this in private conversation. People point to the financial sector as a place where we have seen lots of things happening. Interest rates are largely liberalised and higher, and the exchange rate is near or above equilibrium. Both of these are major changes from the 2000s when interest rates were far too low (causing big over-investment) and the exchange rate was weak (causing too much investment in tradables). Over in fiscal policy, we have the central government taking on large amounts of local government debt, which is a good step too.

Others focus on “supply-side” reform – which in China means shutting down excess capacity, the type of thing which happens normally during a business cycle in a market economy. It seems a bit weird to call this “reform”, since it does not change the way things are done, but these shut-downs are definitely needed and its progress.

Others point to anti-corruption which is also a hugely positive reform. It has stopped the rot in the bureaucracy and SOEs and should improve the investments SOEs do and the quality of the services the bureaucracy delivers.

These reforms are indeed important. And to some extent they have meant that the economy has slowed. But that’s OK.

Second, many people say that reform is going forward but it’s slow and tough. Beijing needs to move carefully, and they need to sequence the reforms properly. . For hopeful people, this is their preferred answer to “how is reform going?” Take SOE reform – there are bits and pieces of progress, like the agreement to classify SOEs into competitive and strategic sectors. And some preparations for Temasek-like management companies. Anti-corruption has made moving all this cheese much easier. But all this has taken a lot of time. Over the next few years, there will be more progress, these people say. “We need to buy time for reform”, these folk say.

The third response you don’t often hear. We all want to remain hopeful and patriotic. And we do not want to give up. But the third response is that the economic reform agenda is dying. I think there are some signs of this. Let me lay this argument out here.

Take government debt, for instance. The Ministry of Finance has backtracked on its #43 document, the policy of late 2014 which attempted to stop new borrowing from banks by local government financing platforms. A sharp slowdown in infrastructure spending followed in Q4 2014 and Q1 2015. That was a big shock to the economy, given that spending amounted to some 8-10% of GDP in 2014. Provincial officials came to Beijing during the NPC meetings of 2015 and complained. The economic data got bad. The State Council then gradually watered down the #43 policy over the course of the rest of 2015. The bond market got re-opened for platform company issuance - and China Development Bank got a CNY 2tn+ line of financing direct from the People’s Bank of China’s balance sheet. In Q3, the CBRC instructed the banks to lend to “key projects” (zhongdian xiangmu) being built by the pingtai.

This Q1 we have seen the results of all this work - a massive increase in credit, mostly going into infrastructure. The MoF claims that its public-private partnership (PPP) programme is working, but anyone familiar with the contracts knows that the middle “P” stands for State-owned Enterprise (SOE), not the private sector. This is not a minor problem – it is a fundamental problem. The magic of having a proper “P” (private company) involved is that they have an interest in the project being commercially viable. Without them, bad, unprofitable projects are too easily green-lit, with the returns relying upon a payment by the local government. Has anyone in China yet sorted out a viable commercial pricing and operating model for urban metro? No. Same for water. Same for power, and airports, and highways. Without it, private companies do want to get involved.

So, PPP projects are basically just the old platform model rebooted. If you think it is substantially different, you have to prove that any SOE liabilities in the future cannot come onto the government balance sheet. And I don’t think that is a credible promise.

I remember meeting local officials around the country in 2010-11 and asking them about local debt. They mostly just said that the debt was fine – there was plenty of land backing the liabilities. “Don’t’ worry, the government can never default”, they said. It takes a lot for a government to default, but clearly the problem was far more serious than they said.

So de facto government debt is still going to rise by some 10% of GDP this year, whatever the official deficit number turns out to be. This means government debt – already at 50-70% of GDP is still rising.

Is this the kind of reform we need? No. In other words, the only thing that has really changed is that the scale of the problem has gotten bigger.

This is important. This is not buying time – it is making the problem worse. And we know that higher levels of debt make a financial crisis more likely.

Because of this we also need to look at what is happening in the banking sector. People do not talk about “shadow banking” much these days – but while the worst of the abuses have died down, the “shadow” is still growing in size. Wealth management product (WMP) AUM has continued to grow fast at the banks, particularly the shareholding and city commercial banks. Last year, WMP AUM hit CNY 23tn, up from CNY 15tn the year before.

WMP money is still flowing into “non-standard credit assets” - loans in all but name, and the banks continue to not hold any capital against those loans, or tell us anything about the quality of those loans. A lot of the WMP money has gone into the corporate bond market where we are now seeing a wave of long-overdue defaults. Last year, if you bought a WMP, you would have been paid an average of 4.7%, while a risk-free deposit would have paid you 1.7%. That gap has gotten bigger – which suggests the risk has gone up. But still no one is behaving there are any risks.

Banks are also putting the funds given them by normal depositors into “shadow” loans. These funds are being managed by aggressive shareholding banks whose balance sheets are looking increasingly worrying. Some banks have “shadow” loans as big as their official loans now. They do not have capital to back these loans.

Is this the type of reform we need? No. The only thing that has really changed is that the scale of the problem has gotten bigger.

Or look at the “debt-equity swap” decision for the banks. At some point last year, someone in Beijing blinked and signed off on debt-equity swaps. Minsheng Bank reported in its annual report that it has become a shareholder in a number of several disastrously-run companies, including China Erzhong (alongside other banks). Jiangsu’s large-privately owned Rongsheng shipbuilder got similar treatment - Bank of China is now its primary shareholder. We are told that there’s a CNY 2tn quota for more swaps.

Analysts got busy ‘baidu-ing’ what happened with China’s bank reforms fifteen years ago. Apparently, there were debt-equity swaps back then too, so that’s OK! What they either do not realise - or chose not to highlight - is that there is a crucial difference. In the early 2000s, the NPLs were first taken off the banks’ books and put with the “asset management companies” (AMCs). The AMCs then could decide what to do with the assets: sell them, file for the firms’ bankruptcy or negotiate a conversion to equity.

Now, there were loads of problems with this decision - the AMCs were not free to deal with the debts in a purely commercial fashion, and the financing of the AMCs was murky. But at least the banks got free of the toxic loan and the zombie company - and that’s the crucial thing with any bank restructuring. Let me repeat: The key in any successful bank debt work out is this: Get the zombies off the balance sheet of the bank. Instead, with this debt-equity policy, the banks get locked up in the same room with the zombies and have to keep feeding them new loans. Some folk have suggested booking that equity in a SPV. I would just say that the 2008- financial crisis taught us that SPVs are dangerous things since banks’ retain a liability for them.

Is this reform we need? No.

So, how to conclude? Managing a reform programme is amazingly difficult. Just imagine the amount of research and co-ordination and policy decision and implementation and follow-up that are required. At every stage there is resistance. I can sympathise. It’s an almost impossible task. And I know in this process there will be hard choices, some steps forward, some steps back.

But that said, I think reform is in a dangerous place, where the risk is that the problems get worse while we say we are reforming. Buying time is fine – but making the problems bigger is not buying time, its paying time.

The Central Discipline Inspection team website recently put out an oped which discussed what true loyalty is today. It is not saying everything is OK, that every policy is a good policy. When loyalty is mis-defined as unquestioning praise, our leaders lose out, and mistakes become easier.

The people who know how stuff works in China are those who are in a position to do good research and speak the truth. But if these people fear their careers will be damaged, they won’t speak the truth and they will have no incentive to do deep, systematic research. As a result, economic research in China will be shallow and useless for decision-making. The research field will be left to those real “China shorters” who do not understand how China works and just want to make money.

Are China’s economic reforms in great danger here? Yes. We need to think about how to stop the build-up of ever-more debt, we need a clear framework to get the private sector involved in infrastructure, we need a plan to clean up the banks’ balance sheets properly, and a plan to end all the regulatory arbitrage in the banking system.

请允许我直言。我希望中国的经济改革取得成功。我希望改革，是因为我希望北京方面能够成功打造强大、可持续的经济。一个停滞的中国对每个人来说都是坏事——对中国、对整个地区、对世界都是如此。

但我很担心。

我不是一个“看空中国者”。作为一个经常在中国各地旅行的人，我在过去二十年里见到了很多变化。在这段时期的大部分时间里，事情的进展的确相当顺利——无疑比大多数其他新兴经济体要好。人们依然对未来、对他们的孩子的未来感到乐观。北京方面的政策制定者们不是神，但他们也不是笨蛋——随着时间的推移，事实证明他们相当善于制定能够成功地提高民众生活水平的政策。

但我想要问一个诚实的、发自内心的问题：十八届三中全会的改革进行得怎么样？全会提出的改革议程是雄心勃勃而全面的。这是一份长达10年的计划。没有人假装这将是一件容易的事情。全会指出的很多问题都非常复杂。问题相互交织，这意味着政策制定者必须很好地相互协调，而传统上他们在这方面并不擅长。每个人都知道会有阻力。有大量既得利益“奶酪”要扳动。

那么经济改革进展如何？我认为这个问题有三种可能的回答。

第一种回答是改革进展顺利。这是官方的说法，但我认识的人中很少会有人在私下谈话中这么说。人们指向金融业，说这个行业发生了很多变化。利率基本实现自由化，变得更高，汇率接近或者高于均衡值。这两者都是2000年代以来发生的重大变化，那时利率要低得多（引起大规模的过度投资），汇率也十分疲软（导致对可贸易产品投资过多）。在财政政策上，中央政府接手了大量地方政府债务，这也是很好的一步。

其他人则强调“供给侧”改革——在中国这意味着关停过剩产能，而在市场经济的商业周期中发生这类事情很正常。称这为“改革”似乎有点奇怪，因为这并没有改变做事方式，但的确有必要关停过剩产能。

还有人指出，反腐也是一项十分积极的改革。反腐阻止了官僚机构和国有企业的腐败，应该会改善国有企业的投资和官僚机构的服务质量。

这些改革的确很重要。在某种程度上，这些改革意味着经济放缓了。但这没关系。

第二，许多人表示改革正在推进，但过程缓慢而艰难。北京方面需要谨慎行动，而且需要对多项改革合理排序。对于心怀希望的人，这是他们在“改革进行得怎么样？”这个问题上比较愿意听到的答案。就以国企改革为例，这方面有一些零碎的进步，比如将国企分类划入竞争性和战略性领域的意见。还有为建立淡马锡(Temasek)式的管理公司做的准备。反腐让扳动既得利益变得容易得多。但这一切都花了很多时间。这些人说，在接下来几年，会有更多进步。“我们需要为改革争取时间，”他们说。

第三种回答是你不会经常听到的。我们都想保持希望和爱国。我们不想放弃。但第三种回答是经济改革议程正在走向末路。我认为有一些迹象能够体现这一点。让我在这里展开论述。

比如，以政府债务为例。财政部已经放弃了“43号文”，即2014年底出台的试图阻止地方政府融资平台从银行获取新贷款的政策。在2014年第四季度和2015年第一季度，基础设施支出随之急剧下滑。考虑到2014年基础设施支出占国内生产总值(GDP)的比重约为8%-10%，这对经济造成重大打击。2015年，各省级政府官员前往北京参加全国人大会议时抱怨了该问题。经济数据恶化。之后国务院在2015年剩余时间内逐渐淡化43号文相关政策。债券市场再次向平台公司开放债券发行，而国家开发银行(CDB)直接从中国人民银行(PBoC)的资产负债表上得到了逾2万亿元人民币的融资额度。去年第三季度，中国银监会(CBRC)指示银行向平台公司建设的“重点项目”提供贷款。

今年第一季度，我们看到了所有这些工作的结果——信贷规模大幅增长，绝大多数新增信贷进入基础设施项目。财政部声称其“政府和社会资本合作”(PPP)项目正在取得效果，但是熟悉相关合同的人都知道，中间的P代表的是国有企业，而非私营部门。这不是小问题，而是根本性问题。吸引适当的“私”（私营企业）参与项目的魔力在于，它们的利益是让项目具有商业可行性。如果没有私营企业，无法盈利的坏项目极容易被放行，收益依赖于地方政府拨款。中国迄今有人为城市地铁想出可行的商业定价和运营模式吗？没有，饮用水方面也一样。还有电力、机场和公路也是如此。在还没有出现这样的模式的情况下，私营企业确实希望参与其中。

因此，PPP项目基本上只是重新启动的老平台模式而已。如果你认为它们在本质上是不同的，你必须证明国企的任何负债未来都不会进入政府的资产负债表。我不认为这是可信的承诺。

我还记得2010-2011年间我与中国各地的地方政府官员见面并询问他们有关地方债务的问题。他们大多只是说债务水平还好——地方政府有足够的土地支撑债务。他们说：“别担心，政府永远不会违约。”要让政府违约不容易，但是问题的严重程度显然远远超过他们的表述。

无论官方赤字数字最终几何，今年实际的政府债务与GDP之比仍将上升10个百分点左右。这意味着政府债务（已经达到GDP的50%-70%）仍将继续上升。

这是我们需要的那种改革吗？不是。换句话说，唯一真正发生的改变是，问题变得更严重了。

这很重要。这不是争取时间——这是让问题恶化。众所周知，债务水平上升会使金融危机发生的可能性增加。

因此，我们还需要观察银行业动态。近来，人们不常讨论“影子银行”——但是，尽管滥用影子金融最严重的时期已经过去，“影子”仍在不断扩大。银行理财产品的资产管理规模持续快速增长，特别是股份制银行和城市商业银行。去年，理财产品的资产管理规模达到23万亿元人民币，远高于前一年的15万亿元人民币。

理财产品的资金仍然不断流入“非标信贷资产”——即有实无名的贷款，同时银行继续不针对这类贷款持有资本，也不告诉我们这些贷款的质量。很多理财产品资金都进入了企业债券市场，我们如今即将见证该市场推后已久的违约潮。去年，如果你买了理财产品，你得到的平均收益率是4.7%，而无风险存款利率为1.7%。二者差距扩大了，表明风险上升。不过，目前所有人都仍然表现得像毫无风险一样。

银行还在用普通储户的资金发放“影子”贷款。这些资金由激进的股份制银行管理，后者的资产负债表日益令人不安。一些银行的“影子”贷款规模现在和它们的正式贷款不相上下。它们没有资本支持这些贷款。

或者看看银行的“债转股”决定吧。在去年的某个时候，北京有人眨了眨眼，就签署了债转股协议。民生银行(Minsheng Bank)年报显示，与其他银行一样，该行已成为多家经营不善公司的股东，包括中国二重(China Erzhong)。江苏大型民营造船公司熔盛重工（Rongsheng，现更名为华荣能源）也获得了类似的待遇——中国银行(BOC)现在是该公司的最大股东。我们被告知，还有2万亿元人民币的债转股配额。

分析师忙着“百度”15年前中国的银行业改革情况。那时显然也有债转股，那么现在也没问题！他们没有意识到（或者有意不去强调）的是，现在的情况截然不同。在本世纪初，不良贷款首先被剥离银行账簿，放入“资产管理公司”。资产管理公司随后可以决定如何处置这些资产：出售它们、申请相关企业破产或者谈判转股事宜。

这一决定面临大量问题——资产管理公司无法按照纯粹的商业方式处置这些债务，而且资产管理公司的融资也不透明。但至少银行摆脱了不良贷款和僵尸企业——这是任何银行重组的关键。让我再重复一遍：任何银行债务重组成功的关键是：将僵尸企业剥离出银行资产负债表之外。相反，按照现在的债转股政策，银行和僵尸企业被绑在同一条船上，不得不一直向它们发放新贷款。一些人建议将股权登记在特殊目的公司(SPV)。我只想说，2008年金融危机让我们明白，SPV是很危险的东西，因为银行依然对它们负有责任。

我们需要这种改革吗？不需要。

那么结论是什么？管理一项改革计划极为困难。只要想一想必须进行多少研究、协调、政策决策、实施和跟进工作就会明白。在每一个阶段都有阻力。我能够理解。这几乎是一个不可能完成的任务。我知道，在这个过程中将出现艰难的选择，有时进几步，有时退几步。

尽管如此，我仍认为当前改革处于危险境地，风险在于，在我们说我们正在改革的时候，问题实际上在恶化。争取时间可以，但让问题恶化不是争取时间，而是交出时间。

中纪委监察部网站最近刊登了一篇评论文章，谈论当今社会真正的忠诚是什么。忠诚并不是表态说一切都好，所有政策都是好政策。当忠诚被错误定义为全无异议的赞美，我们的领导人就会迷失，就会更容易犯错。

知晓中国运作方式的人是那些有条件从事深度研究和说真话的人。但如果这些人担心他们的职业生涯被破坏，他们就不会说真话，也没有动力从事深度的系统性研究。结果是，中国的经济研究将会是肤浅的，而且对决策无用。从事研究的将只剩下那些不理解中国运作方式、只想赚钱的真正的“中国空头”。

现在中国的经济改革处于极大的危险之中吗？是的。我们需要考虑如何让债务不再越积越多，我们需要制定让私营部门参与基础设施建设的清晰框架，我们需要拿出正确清理银行资产负债表的计划，以及终结银行体系中一切监管套利的计划。

（本文仅代表作者本人观点）

译者/何黎