Our province has issued the "Opinions on Further Promoting the Accelerated Investment of Shandong Province's New and Old Energy Conversion Fund"
The positioning and direction of Shandong Province's New and Old Kinetic Energy Conversion Fund is to utilize the innovative tool of "fiscal+financial" guided by the government, which is not aimed at profit, to leverage the multiplier effect of "four or two to pull a thousand pounds", attract and mobilize financial and social capital, and work together to support the in-depth implementation of major projects for the transformation of old and new kinetic energy.
The Shandong Province New and Old Energy Conversion Fund has achieved phased results in its establishment over the past year, with a total of 48 funds approved and a subscribed scale of 274.5 billion yuan, achieving full coverage of the "Top Ten" industries. However, due to the government guiding funds to come from fiscal funds, the risk appetite is naturally relatively low, resulting in weak attraction of funds to social capital and unsatisfactory investment results. How to control risks in high-risk equity investments while balancing policy objectives and market-oriented development is currently a challenge and difficulty faced by new and old momentum conversion funds.
Recently, our province issued the "Opinions on Further Promoting the Accelerated Investment of Shandong Province's New and Old Kinetic Energy Conversion Fund", proposing 20 policy measures from four aspects: reforming the fund management system, lowering the threshold for fund establishment, etc., further adjusting and improving fund policies, exploring the balance point between "market-oriented operation" and "policy objectives", and promoting the accelerated transformation of funds towards marketization.
Delegating power: making fund management more trusting of the market
Government investment funds are a new phenomenon with their own laws, and the operation of fund investment needs to be gradually improved through continuous innovation. In cooperation with well-known domestic institutions, the Shandong Province New and Old Energy Conversion Fund is also constantly adjusting policies to meet market-oriented needs.
In fact, since its establishment in 2018, the Shandong Province New and Old Energy Conversion Fund has undergone three policy optimization adjustments. When it comes to the background of this policy adjustment, Chu Mingfeng, Deputy Director of the Provincial Party Committee Finance and Economics Office, frankly stated: "The transformation of old and new driving forces in our province has taken full effect, and there is an urgent need for a large amount of financial and social capital to participate. Since the establishment of the New and Old Driving Forces Transformation Fund, relevant parties have made a lot of efforts and achieved phased results, but its role is not yet fully played, and there are also many contradictions." The problem can be summed up in one point, which is the low degree of marketization of the fund.
Li Feng, Deputy Director of the Provincial Department of Finance, introduced that in order to clarify the boundary between the government and the market and strengthen the role of market entities, this reform follows the principle of "managing both ends and opening up the middle". In terms of fund establishment mechanism, there will no longer be a fund decision-making committee or policy review committee, and the government approval and policy review in the fund establishment process will be eliminated. The decisive role of the market in resource allocation will be emphasized, and the New Energy Fund Company will be given independent decision-making power in determining cooperative institutions, establishing funds, and other matters.
In terms of fund operation mechanism, the "entrusted management" will be changed to "direct capital injection", and the portion of the provincial financial investment will be guided as the registered capital of the New Energy Fund Company, specifically used to establish the Shandong Province New and Old Energy Conversion Fund.
"By adopting the above methods, we can not only quickly become bigger, stronger and better guide fund management companies, concentrate financial resources to build 'Shandong version of deep venture capital', but also help guide people from all walks of life to continuously deepen the reform of Shandong's good expectations." Zhao Quanhou, director and researcher of the Financial Research Center of the Chinese Academy of Fiscal Sciences, believes that the 20 policies and measures introduced by Shandong this time have two outstanding characteristics. "One is that government departments fully delegate power, and the other is that fund management believes more in the market".
Zhao Quanhou added that decentralization does not mean devolved from a higher government to a lower government, but rather clarified the relationship between the government and the market through decentralization. At the same time, the government lowers some establishment thresholds, which is conducive to encouraging fund institutions to do their own things according to market conditions and develop in a more market-oriented direction.
Profit: Looking for the balance of "market-oriented operation" and "policy objectives".
How to find a balance between "market operation" and "policy objectives"? This is also the biggest difficulty for government-led funds.
The Opinion provides for this and makes policy concessions to fund institutions. For example, significantly reduce the proportion of the fund's investment in Shandong, reduce the 1.5 times to guide the fund's contribution. At the same time, in order to attract funds to invest in Shandong projects, it is stipulated that for funds that meet certain conditions to invest in Shandong projects, the guiding fund can make full profits, and for funds that invest in projects outside the province, the guiding fund implements the same shares and the same rights, and attracts funds to invest more in Shandong's high-quality projects through market means. Another example is to significantly increase the proportion of investment in the guiding fund and increase the investment in the industrial fund to 25%. Among them, the proportion of funds and venture capital funds in the fields of modern high-efficiency agriculture and modern marine industry has been increased to 30%, and the proportion of joint investment by provincial, municipal and county governments at all levels has been increased to 50%, and so on.
It is understood that the proportion of capital contribution has been one of the "hard standards" of the government to guide the fund. "Usually, the proportion of government-led funds is between 20% and 30%, which is limited." Li Shouyu, vice president and secretary of the board of directors of Shenzhen Venture Capital, said.
"In the government guidance fund, it is rare to have a contribution ratio of more than 30%." Hu Jinyan, secretary of the Party Committee of Qingdao University, also believes that "this time Shandong is more favorable in terms of lowering the fund threshold, adjusting the fund return ratio and increasing the guiding fund contribution ratio. In terms of policy incentives, measures such as guiding fund concessions and financial incentives should be said to be very strong in the country." In his view, these policies and measures are undoubtedly a step further in solving the problem of government-guided fund investment constraints.
In addition to giving profits to fund institutions, in order to balance "market-oriented operation" and "policy objectives", provincial government guidance fund management and operation platform and state-owned capital investment and operation platform will also adhere to market-oriented and fair operation. Liang Lei, deputy general manager of Shandong Caijin Group and general manager of the Provincial New Kinetic Energy Fund Company, said that the company will introduce third-party institutions to independently conduct due diligence evaluations, improve the marketization and professionalism of fund decision-making, and do not interfere with specific project investment decisions. Professional people do professional things.
Reform: better serve the new and old kinetic energy conversion major projects
"The purpose of setting up the old and new kinetic energy conversion fund is to support and guarantee the in-depth implementation of major projects for the conversion of old and new kinetic energy." Li Feng said that in order to accurately support major projects for the conversion of new and old kinetic energy, the following three aspects will be focused on:
"Tailor-made" set up project funds. In order to realize the accurate support for the major "double recruitment and double introduction" industrial projects in the whole province, a number of key projects have been selected in the province recently. It is planned that the provincial guidance fund, together with the city and county guidance fund, will adopt market-oriented operation and support through the establishment of project funds.
"Select the best from the best" to form a project library. In the early stage, the Provincial Development and Reform Commission and the "Top Ten" industry special class have initially established a provincial fund investment project library, with a total of 1402 projects in the library and an application for fund investment of 347.5 billion yuan. In the next step, the new kinetic energy fund company will be urged to complete the construction of the fund investment project library on the basis of the original project library and combined with the special requirements of fund investment, so as to lay the foundation for fund investment.
"Precision docking" to carry out "double-base" promotion activities. In the province to carry out the fund into the grass-roots "double base" promotion docking activities. In the early stage, the Provincial Department of Finance has successively went to Weifang, Weihai, and Yantai to hold 3 project promotion conferences, focusing on the promotion of more than 120 high-quality industrial projects, and reached 31 intended investment projects. The fund plans to invest 6.3 billion yuan. In the next step, according to the industrial advantages of each city, we will continue to organize project fund docking activities in other cities in stages and batches.
"This is a drastic reform." Ying Wenlu, chairman and founding partner of Yida capital, told reporters, "judging from our contacts with various places, Shandong should be in the forefront of national reform this time. No matter from the regional restrictions on investment or the proportion of return investment, it is a very market-oriented choice. I believe it will attract many market-oriented institutions to Shandong for development." (Reporter Dai Lingling Intern Li Kexin)
Information source: Dazhong Daily
Editor He Yang of this website/Organizing
