First-Line Fax·Issue 3
On March 5, the fifth session of the 13th National People's Congress opened at the Great Hall of the People in Beijing. Premier Li Keqiang delivered the "Government Work Report" (hereinafter referred to as the "Report" "). Among the many pieces of information in the report, which ones are closely related to the ceramic industry?
GDP growth is about 5.5%
[Original report]The main expected development goals for this year are: GDP growth About 5.5%.
[Report Interpretation]In today’s very severe economic situation, the development goal of “gross domestic product growth by about 5.5% in 2022” It is inseparable from the stable development of the real estate industry. On February 24, Wang Menghui, Minister of Housing and Urban-Rural Development, stated that the Ministry of Housing and Urban-Rural Development will implement a package of work on real estate and urban-rural development in 2022, such as strengthening real estate market regulation, promoting housing supply-side structural reform, implementing urban renewal actions, and implementing rural construction actions. They are all trying to play a positive role in "stabilizing the macroeconomic market."
Virtuous cycle and healthy development of the real estate industry
[Original report]Continue to ensure the housing needs of the people. Insist that a house is for living in,It is not positioned for speculation. We should explore new development models, insist on promoting both renting and purchasing, accelerate the development of the long-term rental housing market, promote the construction of affordable housing, support the commercial housing market to better meet the reasonable housing needs of home buyers, stabilize land prices, stabilize housing prices, and stabilize housing prices. It is expected that city-specific policies will promote a virtuous cycle and healthy development of the real estate industry.
[Report Interpretation]To play a positive role in the real estate industry, a virtuous cycle and healthy development are necessary. Since the end of 2021, "meeting reasonable needs" and "virtuous cycle" have been mentioned several times. Relevant departments such as the Ministry of Natural Resources, the Ministry of Housing and Urban-Rural Development, the China Banking and Insurance Regulatory Commission, the Central Bank, and various localities have spared no effort to implement this new requirement.
On March 1 this year, Zhengzhou City issued the "Notice on Promoting a Virtuous Cycle and Healthy Development of the Real Estate Industry." It is expected that more cities will take measures to relax regulations due to downward market pressure, reversing real estate market expectations.
On March 4, the 2022 Financial Market Work Video Conference held by the Central Bank also once again emphasized "city-specific policies to promote a virtuous cycle and healthy development of the real estate industry."
Real estate industry policies have been relaxed, and so far no substantive policies have been introduced or implemented. But such a signal is undoubtedly a big plus for the construction and ceramics industry, which will usher in the "five consecutive increases in Enping natural gas prices" after the year.
Stabilize the macroeconomic market and promote new urbanization
[Original report] Government investment funds must be well used to promote the expansion of effective investment. This year, it is planned to arrange 3.65 trillion yuan in local government special bonds. Strengthen performance orientation, insist on "funds follow the project", reasonably expand the scope of use, support follow-up financing of projects under construction, and start a number of qualified major projects and new infrastructureconstruction projects such as facilities and renovation of old public facilities. Private investment accounts for the majority of investment. It is necessary to give full play to the role of major projects in guiding and leveraging government investment, improve relevant support policies, and fully mobilize the enthusiasm of private investment.
Improve the quality of new urbanization. Promote urban renewal in an orderly manner, strengthen the construction of municipal facilities and disaster prevention and reduction capabilities, carry out investigation and rectification of potential safety hazards in old buildings and facilities, start the renovation of a number of old urban communities, and promote the construction of barrier-free environments and age-appropriate renovations. Improve the system for providing basic public services in the place of permanent residence. Strengthen county infrastructure construction. Steadily advance the construction of urban agglomerations and metropolitan areas, and promote the coordinated development of large, medium and small cities and small towns. Strictly control the dismantling of counties and the establishment of cities and districts. Protect and inherit historical culture in urban and rural planning and construction. It is necessary to further promote the new type of urbanization with people at the core and continuously improve the quality of people's lives.
[Report Interpretation]How can the real estate industry cycle and develop in a "virtuous cycle and healthy development"? Under the current model, even if local governments provide some high-quality land parcels, not only developers are not active in acquiring land, but consumers' sentiment toward home buying is also low. Real-time data shows that in January, the unsold rate of urban land monitored by CRIC reached 25%; Shenzhen’s second-hand housing transaction volume hit a 15-year low in February; sales of key real estate companies fell by 30%-40% year-on-month.
So the "Two Sessions" proposed to "explore new development models, insist on promoting both renting and purchasing, accelerate the development of the long-term rental housing market, promote the construction of affordable housing, and support the commercial housing market to better satisfy home buyers. reasonable housing needs.” As for the new model, the country’s “Two Sessions” have also made preparations. The new model is essentially about supplying housing products with lower cost, complete supporting facilities, decent living, and suitable for the housing needs of new citizens, that is, focusing on old renovation, urban renewal, long-term rental housing, shared ownership housing, affordable rental housing, etc.
However, this model is led by government funds, private capital is the main body, and major real estate companies undertake project construction. In other words, the engineering channel may be the market focus of the construction and ceramics industry in the past two years. However, due to frequent thunderstorm incidents among major real estate companies, many ceramic companies have lingering fears about project channels. "Recommendations on Preventing and Controlling Commercial Acceptance Bill Risks through Multiple Approaches and Creating a Safe and Sustainable Development Environment for the Manufacturing Industry" submitted by Huang Jianping, Chairman of Marco Polo Holdings Co., Ltd.》The proposal reflects the industry’s concerns about engineering channels. As a result, whether the focus of this year's work is to develop new retail or bet on engineering channels has become a strategic choice that all ceramic companies have to face.
Promote green and low-carbon development
[Original report]The main expected development goals for this year are: the energy intensity target is During the "14th Five-Year Plan" period, assessments will be coordinated and appropriate flexibility will be allowed. New renewable energy and raw material energy will not be included in the total energy consumption control.
Promote the carbon peak and carbon neutrality work in an orderly manner. Implement the carbon peak action plan. Promote the energy revolution, ensure energy supply, base on resource endowments, insist on establishing first and then breaking, and make comprehensive plans to promote low-carbon energy transformation. Strengthen the clean and efficient use of coal, reduce and replace coal in an orderly manner, and promote energy-saving and carbon-reduction transformation, flexibility transformation, and heating supply transformation of coal power. Promote the planning and construction of large-scale wind and photovoltaic power bases and supporting regulated power sources to enhance the power grid’s ability to absorb renewable energy power generation. Promote the research, development, promotion and application of green and low-carbon technologies, build a green manufacturing and service system, and promote energy conservation and carbon reduction in industries such as steel, nonferrous metals, petrochemicals, chemicals, and building materials. Resolutely curb the blind development of high-energy-consuming, high-emission, and low-level projects. Promote the transformation from "dual control" of energy consumption to "dual control" of total carbon emissions and intensity, improve incentive and restraint policies for pollution reduction and carbon reduction, and accelerate the formation of green production and lifestyle.
[Report Interpretation]Changes in energy consumption policies have brought good news to the construction and ceramics industry. The statement "The energy intensity target will be assessed as a whole during the 14th Five-Year Plan period, with appropriate flexibility" means changes in the assessment cycle and assessment intensity.
The assessment cycle has changed from an annual assessment to an overall assessment during the "14th Five-Year Plan" planning periodnuclear. The most direct impact of this change in the assessment cycle is that annual goals such as "the percentage reduction in energy consumption per unit of GDP" will no longer be established. Judging from the setting of energy consumption targets for 2022 in the "Two Sessions" in some places, this is indeed the case. For example, the expected energy consumption targets of provinces such as Sichuan and Chongqing in 2022 are set to "the energy consumption intensity will be coordinated to complete the national goals during the 14th Five-Year Plan period."
"Coordinated assessment" of energy consumption intensity means that the frequency of energy consumption intensity assessment will be optimized, and enterprises can avoid energy consumption restrictions due to "excessive" energy consumption indicators. For the construction and ceramics industry, such a more flexible energy consumption management method will help it carry out production and operations in an orderly manner.
Some analysts believe that the expression "appropriate flexibility" is also provocative. If the pressure for economic growth is too great, can those projects that cannot be launched due to energy consumption constraints be flexibly launched?
In addition, the "dual control" of energy consumption is a single assessment of the total energy consumption. The "dual control" of total carbon emissions and intensity assesses total carbon emissions and carbon emission intensity per unit of GDP. The transformation of the assessment method from "dual control" of energy consumption to "double control" of total carbon emissions and intensity allows local governments to flexibly adjust according to the specific conditions of economic development when setting goals, avoiding "movement-style" carbon reduction and "One size fits all."
Whether it is changing the assessment method or implementing a more flexible energy consumption management method, it does not mean that the construction and ceramics industry can "sit back and relax." Wan Jie, a member of the National Committee of the Chinese People's Political Consultative Conference and chairman of Yachang Culture Group, submitted a "Proposal on the National Development and Reform Commission to Strengthen Information Disclosure and Policy Evaluation of Dual Energy Consumption Controls", recommending that third-party evaluations of the implementation effects of dual energy consumption control policies be carried out on a regular basis. The "Government Work Report" also emphasizes the need to "resolutely curb the blind development of high-energy-consuming, high-emission, low-level projects."
While relaxing the "dual control" of energy consumption, the country has also proposed work directions and goals for energy conservation and carbon reduction. On February 3, the countryFour departments including the Development and Reform Commission jointly issued the "Implementation Guidelines for Energy Saving and Carbon Reduction Renovation and Upgrading in Key Areas of High Energy-Consumption Industries (2022 Edition)." The "Implementation Guide" targets the cement, flat glass, and building sanitary ceramics industries in the building materials industry, seizes key areas, clarifies the basic situation of energy efficiency in each industry, puts forward the work direction and goals for energy-saving and carbon-reducing transformation and upgrading, and plays a key role in promoting the key points of the building materials industry. It is of great significance to save energy and reduce carbon in the field and achieve green, low-carbon and high-quality development.
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According to the target planning for the real estate industry in the report, there will be a large wave of market growth this year, whether it is renovation or urban renewal. Around March, Xining City, Qinghai Province planned to build 11,000 units of affordable rental housing during the "14th Five-Year Plan" period, including 2,000 units in 2022; Hunan Province will start construction of 6,202 units of public rental housing and 45,801 units of affordable rental housing. Rental subsidies are provided to 97,806 households; Tianjin plans to complete real estate development investment of 240 billion yuan throughout the year, start construction of 12 million square meters of new commercial housing, complete 15 million square meters, and maintain the cumulative construction area at more than 110 million square meters... With the policies of various places It has been disclosed one after another that the construction and ceramics industry may usher in a "spring".
Of course, looking at the "Two Sessions" target plans for the real estate industry and manufacturing industry, it is not difficult to see that compared with previous years, a major change in the real estate industry is the foundation for the healthy development of the real estate industry. The purpose is to inject blood into the industrial manufacturing industry. The major investment projects, infrastructure projects, shortcomings in people's livelihood, new urbanization, equalization of public services, construction of people's livelihood facilities, inclusive financial support for new citizens, etc. proposed in the "Report" are all the focus of economic work in 2022. The starting point of "stable growth". All of this costs money. Where does the money come from? Real estate is a blood transfusion channel.
As a traditional manufacturing industry that has been affected by blood transfusions, the top priority of the construction and ceramics industry in the past two years is to seize the time to upgrade the industry and improve its competitiveness. On the other hand, whether to bet on engineering channels is also related to the survival and development of major ceramic companies.
