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Reform of the supply front has become a frequent topic in top leaders' speeches in November.

China's premier, Li Keqiang, pointed out that China will promote structural reform in both dimensions of supply and demand. Li’s statement was based on research by the National Development and Reform Committee.

At the 11th meeting of the Central Finance and Economy Group on Nov. 10, President Xi Jinping stressed that China should strengthen structural reform of the supply front to increase the quality and efficiency of the supply system and provide a growth impetus for sustainable economic development.

At the G20 summit, Xi mentioned that the global economy should attach importance to both demand and supply.

Supply-front economics promotes growth by investing in capital, and by lowering barriers on the production of goods and services. It is the opposite of Keynesian theory, which states that demand is the primary driving force for an economy. Instead, it recommends lower tax rates and deregulation to boost supply and create more demand.

At present, China's reform of the supply front is a comprehensive strategic deployment that involves industries, macro control, capital and the fiscal and taxation systems.

Absorption of excessive production capacity, along with industrial optimization and reorganization, should be promoted. Enterprises should keep their competitive edge by reducing costs. The real estate industry should promote sustainable development through reducing stock.