The importance of "supply-side reform" was emphasized by Xi Jinping at the 11th meeting of the CPC Central Leading Group for Financial and Economic Affairs on November 10, 2015. Supply-side policies, which focus on supply and production,areoften discussed in contrast to a demand-side approach. To improve supply-side performance is to unleash productivity and maintain a competitive edge, with greater innovation, decommissioning of obsolete manufacturing, less overcapacity, and lower tax rates, so as to boost economic growth.
This reform is placing greater emphasis on optimizing the economic structure and enhancing the efficiency of all contributing factors. To this end, measures will be implemented to streamline government and delegate powers, relax macro-regulation, spur innovation, and reform the financial sector, land use rights, and SOEs.The reform plan is designed toaccelerate structural change, fuel domestic demand and expand supply. Innovation will be encouraged to generate greater demand, which will in return lead to improvements in supply. Steady growth and structural adjustment should be mutually supportive and proceed in parallel.