Great successes were achieved in reform and opening up over the past five
years. Major progress was made in rural reforms, in reform of state-owned
enterprises, and in reform of the financial, fiscal, tax and investment systems
as well as in developing a market economic system and a social security system.
China's accession to the WTO began a new stage in opening up. The total import
and export volume tripled over the last five years, and the amount of foreign
direct investment actually used came to 274.08 billion dollars. A number of
competitive enterprises went global.
People's living standards improved markedly over the last five years. Urban
per capita disposable income rose by 58.3 percent and rural per capita net
income grew by 29.2 percent, both in real terms. About 42 million new jobs were
created in urban areas. Consumer spending on housing, communications, cars and
services grew significantly. Rapid progress was made in science and technology,
education, culture, health, sports, and other social programs.
Further progress was made in socialist political, cultural, and social
development over the past five years.
These splendid achievements have greatly increased the confidence of all our
ethnic groups to forge ahead on the path of socialism with Chinese
characteristics.
At the same time, we also encountered many difficulties and problems in
economic and social development during the Tenth Five-Year Plan period. The main
problems were an unbalanced economic structure, weak capacity for independent
innovation, slow change in the pattern of economic growth, excessive consumption
of energy and resources, worsening environmental pollution, serious
unemployment, imbalance between investment and consumption, widening gaps in
development between urban and rural areas and between regions, growing
disparities between certain income groups, and inadequate development of social
programs. We need to work hard to solve all these problems.
3. Guiding principles and major targets for economic and social development
in the Eleventh Five-Year Plan period
The Eleventh Five-Year Plan period will be a crucial time in building a
moderately prosperous society in all respects. A comprehensive analysis of all
factors shows that on the whole the international environment will be conducive
to China's development in the coming five years, but that there are quite a few
unstable factors and uncertainties. Domestically, there are many favorable
conditions as well as a number of restraining factors and difficulties. We
should seize opportunities, exploit favorable conditions while avoiding dangers,
remain vigilant against adversity, properly handle risks and challenges, and
press ahead with reform and opening up and the modernization drive.
The Outline (draft) fully reflects a scientific outlook on development and
embodies the important principles laid out in the Proposal of the Central
Committee. These principles are: We must sustain steady, rapid economic
development, speed up change of the pattern of economic growth, improve China's
capacity for independent innovation, balance development between urban and rural
areas and among regions, intensify efforts to build a harmonious society, deepen
reforms and open wider to the outside world. To put these principles into
practice, we need to change our way of thinking about development, create a new
pattern of growth, improve the quality of development, and make economic and
social development more people-oriented, comprehensive, balanced, and
sustainable.
Major targets for economic and social development in the Eleventh Five-Year
Plan period listed in the Outline (draft) were set on the basis of the
guidelines and principles set out in the Proposal of the Central Committee.
These targets are designed to meet the goal of building a moderately prosperous
society in all respects, and they reflect conditions of the current stage of
economic and social development as well as objective requirements. Now, I would
like to briefly speak about just two of these targets.
First is the economic growth rate. GDP growth for the next five years is set
at an annual average of 7.5 percent in the Outline (draft). This figure is based
on necessity and feasibility and was determined taking all factors into account.
According to recently published data from the first national economic census and
the actual results of economic growth in 2005, the GDP growth rate during the
Tenth Five-Year Plan period was higher than originally projected. If the average
annual growth rate is maintained at 7.5 percent during the Eleventh Five-Year
Plan period, the goal of doubling the 2000 per capita GDP by 2010 set in the
Central Committee's Proposal will be surpassed. This is an ambitious target, but
we can attain it with hard work. It should also be pointed out that this target
is based on successfully improving economic structure and efficiency and
reducing energy consumption. In actual implementation, each local government
should balance the growth rate with structural and performance improvement,
rather than single-mindedly competing with other areas for the fastest economic
growth. Both historical and recent experiences show that it is crucial to
maintain fast yet steady economic development.
Second is energy conservation and environmental protection. In the Outline
(draft), the target for reducing energy consumption per unit of GDP is set at
about 20 percent and the target for cutting the total discharge of major
pollutants is set at 10 percent. These targets are designed to address the acute
problem of mounting pressure on resources and the environment. They reflect the
need to build a resource-conserving and environment-friendly society and are
necessitated by current conditions and long-term interests. They therefore
provide a clear guide for policy making. Though achieving them will be quite
difficult, we have the confidence and determination to succeed.
4. Strategic priorities and major tasks during the Eleventh Five-Year Plan
period
The Outline (draft) lays out the overall arrangements for economic and social
development and for reform and opening up in the Eleventh Five-Year Plan period
and sets out clear tasks and policy measures.
First, we must build a new socialist countryside. Among all the strategic
tasks before us, the Outline (draft) gives top priority to solving the problems
facing agriculture, rural areas and farmers. There is a heavy stress in the
Outline (draft) on the need to continue balancing economic and social
development in urban and rural areas and to make steady progress in building a
new socialist countryside by developing production, improving living standards,
fostering more civil behavior, improving the overall cleanliness of villages,
and exercising democratic management. We need to increase overall agricultural
capacity, promote agricultural restructuring, intensify development of rural
infrastructure, and increase farmers' incomes. We will focus on implementing key
projects to establish large production bases for grain, cotton and edible oil,
industrialize production of superior quality grain varieties, build water
conservancy facilities and safe drinking water supplies, build roads and methane
production facilities, and develop education, culture and health in rural areas.
We must also comprehensively promote overall rural reform and basically complete
reform of town and township government bodies, rural compulsory education, and
fiscal management in counties and townships. We need to create a new type of
farmer who has a good basic education and understands both agricultural
techniques and business operations. All localities and government departments
must substantially change their thinking and priorities in their economic work.
More development funds need to be directed toward solving the problems of
agriculture, rural areas and farmers, and public services need to be made more
widely available in rural areas. All of society should energetically support
rural development.
Second, we must accelerate economic restructuring and change of the pattern
of economic growth. Many problems impeding China's economic development arise
from an unbalanced economic structure and an extensive pattern of economic
growth. We must pursue development by taking a new road toward industrialization
to improve the industrial structure, conserve resources and protect the
environment. The Outline (draft) calls for improving and upgrading the
industrial structure to make large industries stronger. This is an important
task directed at the fact that although China's industries are already large,
they have poor overall performance and competitiveness. The Outline (draft) sets
forth the major tasks and arrangements for promoting IT application, developing
high-tech industries, revitalizing the equipment-manufacturing industry, and
developing the energy and raw material industries. It also contains plans for a
number of major construction projects. The Outline (draft) emphasizes the
importance of speeding up the development of the service sector, especially in
the fields of information, finance, insurance, distribution, tourism and
community services, to increase its level and its importance in the economy.
