Research On The Policy Effect Of Horizontal Mergers And Acquisitions On The Structural Reform Of The Steel Industry

Since 2012,economic growth slowed down since China entered into the economic new normal,the pressure of the economic downturn will grow with each passing day,the economic structure began to enter the transition period,the economic structure of China dominated by heavy industry to gradually reduce the proportion of the second industry,the domestic steel industry demand is weak,the lack of growth momentum.Lack of demand and overcapacity,insufficient effective supply and inability to match the high-end demand have become the beginning of the contradiction of economic development.In November 2015,the supply side structural reform was put forward as an industrial policy.It emphasized that we should expand the total demand while strengthening the supply side structural reform,and strive to improve the quality and efficiency of the supply system,and enhance the driving force for sustained economic growth.Against this background,if we want to achieve the strategic goal of manufacturing power,we must strengthen the structural adjustment of iron and steel industry as an industrial manufacturing sector.First of all,we must integrate effective resources through horizontal mergers and acquisitions,improve market concentration and reduce backward production capacity.Based on this,taking the horizontal mergers and acquisitions in iron and steel industry as the starting point,this paper explores the industrial policy of supply side structural change,taking Bao Wu merger as an example to analyze whether the policy effect has positive feedback and is sustainable.First of all,from the analysis of macroeconomic factors,the steel industry is the key industry supply side structural reform,and to "capacity" and "deleveraging" as the main task;and according to the development experience of developed capitalist countries late industrialization of iron and steel industry,large horizontal mergers between enterprises is the main way to improve the market concentration degree the control of excess capacity to resolve and market prices have a great effect,greatly enhance the market competitiveness.From the micro point of view,the long-term price of domestic steel and the upside down of the international market is also one of the reasons for increasing the horizontal mergers and acquisitions of iron and steel enterprises.Secondly,this paper analyzes the mechanism of horizontal merger and acquisition to promote the structural reform of steel industry from the three parts of industrial concentration,overcapacity and market price.Theoretical analysis of horizontal mergers can promote industrial concentration to accelerate the upgrading of industrial concentration and with the increase of overcapacity will tend to decline in the peak,and when,with scale effect,will gradually stabilize prices,so as to avoid the abnormal phenomenon of the rose fell.Finally,this paper,taking the merger and absorption of WISCO in Baosteel as an example,analyzes the effectiveness of the industrial policy under the structural reform of the supply side in China.The use of PC AIDS merger simulation technology,elastic system estimation based on market share and industry elasticity,then simulate the price change of Bao Wu after the merger rate,compared with the actual test data after the merger,the quantitative results show that Bao Wu after the merger,does the industrial policy effect plays a role of positive feedback,combined with the analysis of the mechanism,that the industrial policy is sustainable,and gives the corresponding policy recommendations.