Research On The Effect Of Government Subsidy On Steel Enterprise' Performance

In 2015,Premier Li Keqiang repeatedly proposed to actively promote the merger and reorganization of enterprises with excess capacity,deepen the reform of state-owned enterprises,.In December 2016,the central economic working conference identified the task of capacity reduction as the first of China's five major structural reforms,emphasizing the urgent efforts to resolve the problem of serious overcapacity.Over the past 30 years of reform and opening-up,China's economy has continued to grow at a high rate and has entered the ranks of middle-income countries.However,with the decline of population dividend,the accumulation of risks of the "middle-income trap" and the adjustment of international economic pattern,China's economic development has gradually stepped into the "new normal".In recent years,many state-owned enterprises rely on the policy advantages,blindly strive for perfection,and begin to face a series of problems,such as overcapacity,structural distortion,etc,which has seriously drag down the pace of economic restructuring in China.In the face of these changes,reform is imminent.In order to deepen the supply side reform,we must further promote the five structural reform tasks of "de-production capacity,destocking,deleveraging,cost reduction and improvement of short board".In recent years,under the triple pressure of capital,market and environmental protection,major listed steel enterprises are in a precarious situation.Steel enterprises enter the market with high growth and production capacity,but end up with low efficiency and low price.As the steel industry enters the cold winter,the operating profit of steel enterprises is greatly reduced.Bankruptcy and enterprise transformation become the normal survival of iron and steel enterprises.This paper takes Xining Special Steel as a case study,combines the theories of information asymmetry,stakeholders and soft budget constraints,and takes the steel enterprises in the manufacturing industry s as the starting point to study the performance impact of government subsidies on Xining Special Steel,and makes a detailed data analysis.Through the analysis of the data over the years,this paper concludes that the government subsidy evaluation mechanism of Xining Special Steel is incomplete,it fails to play the role of government subsidies in promoting financial performance,and its' innovation capacity and operating level need to be improved.This paper focus on the impact of government subsidies on the performance of steelenterprises,and puts forward some relevant recommendations,hoping to provide reference for similar steel enterprises in the steel industry.