Private equity funds play an active role in economic development. For example, today's heavy chemical industry in China has been overloaded. In developed countries, heavy chemical industry accounts for 65% of industrial output value at the peak of development, while in China it reaches 70%. Heavy chemical industry has the nature of self-circulation or self-strengthening, and our financial system is obviously inclined to this industry. Because this industry is dominated by large and medium-sized state-owned enterprises, and the existing financing channels are mainly open to large and medium-sized state-owned enterprises. The modern service industry, high-tech industry, all kinds of consumer goods manufacturing and consumer service industry that are in urgent need of development are mainly small and medium-sized enterprises and private enterprises. However, the existing financial system does not provide them with corresponding financing channels. This is an area where private equity funds can make a big difference. The development of private equity fund is helpful to promote the adjustment of national industrial structure. The real advantage of private equity funds is real marketization. Fund managers take the growth potential and benefit of enterprises as the principle of investment selection. Investors use their own funds as votes, invest the right to use scarce social production resources in the industries that need to be developed most, and invest in the most efficient enterprises in this industry, as long as the products have market and development potential, regardless of whether this enterprise is a small enterprise or a private enterprise. This can greatly improve the allocation efficiency of scarce production resources in the whole society.

A very important function of private equity funds in traditional competitive industries is to promote the integration of industries. For example, in 2004, there were more than 80,000 garment enterprises in China, exporting more than 654.38+07 billion garments, and the global population exceeded 5 billion except China. We have exported more than three pieces of clothing to all other countries per capita. 80,000 garment enterprises will become bigger and stronger. How can the world absorb our huge production capacity and output? It can be seen that the advantageous industries in China need to make the top 3, top 10, top 100 or top 1000 outstanding enterprises bigger and stronger through mergers and acquisitions. The most scarce resources in China are excellent entrepreneurs and effective enterprise organizations. The most successful enterprise is the organic combination of excellent entrepreneurs and effective enterprise organizations. Let outstanding enterprises merge and integrate the whole industry, and let outstanding entrepreneurs and effective enterprise organizations make the greatest positive contribution to society. Therefore, M&A financing of private equity funds is of great strategic significance to the integration and development of China industries.

Specialized management of private equity funds can help investors to better share the economic growth of China. The development of private equity funds has broadened investment channels, and may divert liquidity to higher-yielding investment areas after offsetting risks. On the one hand, it can alleviate the pressure of the bubble formation in the real estate sector of the stock market; on the other hand, it can cultivate more and better listed companies for investors to choose from, so that investors can share the high economic growth of China through high-return sustainable investment. As an important market constraint force, private equity fund can supplement the deficiency of government supervision. Private equity funds, as major investors, can send financial directors, directors or even major shareholders, and can directly send general managers to enterprises. In this case, private equity funds, as a market supervision force, have played an important role in promoting the improvement of corporate governance structure. Create favorable conditions for enterprises to go public in the future in terms of internal governance structure and internal control mechanism.

Finally, private equity funds can promote the development of multi-level capital markets. Enterprises that can be cultivated for the stock market can promote the development of our domestic GEM and SME board market after the growth of private equity funds.