LED industry revitalization can not rely on planning"

Recently, Shenzhen abolished the "on the issuance of Shenzhen LED industry development plan (2009-2015) Notice" document. The development plan was developed 4 years ago, planning: Shenzhen will build the country and even the world's important LED industry R & D and production base, to 2015 the annual output value of more than 130 billion yuan of industrial scale. Shenzhen is China's most concentrated LED City, the local government to give up the development plan of the LED industry, has a symbolic significance.

Shenzhen has abolished its own leadership in the country and has been listed as an important emerging industry development plan, there are practical reasons. One of the main reasons is that the 90% LED products rely on exports, the domestic market is not open, so a serious excess capacity, Shenzhen is now a billion yuan level LED business failures. The second reason is that there are some provinces before the relevant planning formulation, the LED industry support for the strategic emerging industries, some ministries have issued the "planning" semiconductor lighting industry, resulting in upstream of the LED for a long time that the investment overheating, LED product prices decreased quickly, the downstream business competition, make a some enterprises have closed. Therefore, the LED industry is likely to become the second photovoltaic industry, has become a set, dispersed, and eventually the whole industry in trouble, serious waste of industrial investment.

LED industry and photovoltaic industry in addition to face the same severe dependence on external demand, excess capacity, the market downturn is extremely dilemma, the greatest similarity is, has been around as a strategic emerging industry to focus on planning and support. The reason for these difficulties, in fact, the root cause is due to the local government's enthusiasm for emerging industries and attention. The photovoltaic industry and LED industry situation, as well as from relevant departments when given enough lessons in industrial planning and support, the visible hand should be cautious, for less.

At the beginning of the emerging industries, the visible hand of a certain guidance and support may be needed, such as providing some incubators, etc., but can not be the dominant force in the industry. This is because the development of the industry, mainly by the development of the market and the power of technology, rather than relying on government planning and support can produce and grow. Because of various emerging industries may emerge in an endless stream, rely on the market to verify that it is promising, in the end is to thrive or eliminated, the visible hand did not have the ability to.

For some time, a lot of local industrial planning, planning investment on the hundreds of billions of dollars, on the trillion yuan. This kind of visible hand deeply involved in the market and the economic field, there is the role of dislocation, will bring a lot of side effects. Photovoltaic industry has caused a lot of waste of investment, LED industry may also be a lot of wind power in the past is also an example.

So, as the government, the largest contribution to the economy and society, is not directly involved in the development of industrial planning, is not directly provide the material incentives and support, focused on providing excellent market and business environment for entrepreneurs and workers, so that they can be fair and competitive business. If only on the strength of the industry planning can provide land, tax, credit, export benefits and convenience, so is tantamount to subsidies for taxpayer money, leading some investors "policy arbitrage". At the same time, these measures are not the core competitiveness, preferential tax policies, will cause the land around the big competition, so the overheated investment, excess capacity, market difficult problems will appear immediately, and then there will be a huge investment, the problem of planning yourselves.