China's new five-year plan for national economic and social development between 2006 and 2010, to be ratified by the ongoing annual parliamentary session, has embodied the opportunities as well as challenges for China's central leadership.

In his government work report to the fourth session of the Tenth National People's Congress (NPC) on Sunday, Premier Wen Jiabao said the international environment will be conducive to China's development in the coming five years, but there are many uncertainties.

"Domestically, there are many favorable conditions as well as a number of restraining factors and difficulties," Wen said.

These have been interpreted by observers as opportunities and challenges for the central leadership.

"The coming five years will be a golden opportunity for the central leadership to lead the Chinese people toward prosperity and will test its governance capacity as well," said Xia Xueluan, a professor of sociology at Beijing University.

A 90-page draft outline of the 11th Five-Year Plan for national economic and social development, to be deliberated and ratified by nearly 3,000 lawmakers, is the most eye-catching part of the annual parliament session.

"By submitting the draft to the parliament for deliberation and ratification, it is hoped the top legislature will endorse the basic state policy the central leadership has proposed under the new situation," said Prof. Bai Gang, a member of the National Committee of the Chinese People's Political Consultative Conference (CPPCC), the top advisory body.

The move is designed to ensure China's reform and opening up and it will be pushed ahead smoothly under a projected goal, said Bai, a political science researcher with the Chinese Academy of Social Sciences.

Observers in Beijing say the plan is a milestone, or a new beginning, in China's economic and social development, as the 11th Five-Year Plan period will be a crucial time in building a moderately prosperous society across the country.

While domestic media have compared the 11th Five-Year Plan to another big move following the household contract responsibility system introduced to the Chinese countryside in the 1980s and the socialist market economy of the 1990s, the international community has also expressed optimism, saying the plan heralds a major shift in the ruling party's policy toward green GDP and sustainable development.

Some international observers, however, also voiced concern over China's fast-growing economy, heavy energy consumption and wide gap between the rich and the poor.

These have been included in Wen's report as issues to be tackled in the coming five years, alongside goals to improve the country's economic structure, innovation capacity and growth pattern, curb pollution, create more jobs, balance investment and consumption, reduce income gap and bolster public welfare.

"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," Wen said in the report.

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