(RebOrbit, March 07, 2007) Text of report by official Chinese news agency Xinhua (New China News Agency)

["Two sessions authorized release": "Report on State of Execuition of National Economic and Social Development Plan for 2006 and Draft Plan for National Economic and Social Development in 2007 (Summary)".]

Beijing, 6 Mar (Xinhua) - As commissioned by the State Council, the State Development and Reform Commission on 5 March submitted a "Report on the Execution of the National Economic and Social Development Plan for 2006 and the Draft Plan for National Economic and Social development in 2007" to the fifth session of the 10th National People's Congress. The following is a summary of the report:

State of Execution of the National Economic and Social Development Plan for 2006

In 2006, under the leadership of the CCP, the people of all ethnic groups throughout the country seriously implemented the scientific development concept and the major strategic idea of building a socialist harmonious society; in accordance with the national economic and social development plan discussed and approved by the Fourth Session of the 10th NPC, they speeded up reform and opening up and modernization; development conditions further improved, the development environment was further optimized, the development momentum tended to further improve, a good start as made in achieving the 11th Five-year Programme [FYP], and firm strides were taken towards the grand goal of comprehensively building a well- off society [xiaokang shehui].

- A good posture of relatively fast growth, relatively good economic returns, and relatively low prices was maintained in national economy operation. GDP was 20.94 trillion yuan, a rise of 10.7 per cent. The steadiness of economic growth was markedly strengthened, with relatively small year-on-year and season-on- season fluctuations in the rate of GDP growth. The general consumer price level rose by 1.5 per cent. Fiscal revenue was 3.93 trillion yuan, a rise of 24.3 per cent; profit of industrial enterprises at and above scale level [guimo yi shang[ was 1.8784 trillion yuan, up by 31 per cent. Unit GDP energy consumption declined by 1.23 per cent, the first decline since 2003; and unit water consumption for increased value declined by 9 per cent. A number of conspicuous contradictions and problems in economic operations eased somewhat. The rate of increase in investment fell back somewhat; all-society investment in fixed assets over the year rose by 24 per cent, a decline of 2 percentage points compared with the previous year. Monetary and credit increase tended to moderate. There was a marked improvement in the coal, electricity, and transport shortage. Transport of grain, chemical fertilizer, and other key materials was relatively well assured.

- The building of a new socialist countryside proceeded in sound fashion. The policies favouring agriculture were further improved. Having abolished agricultural tax and tax on speciality agricultural products throughout the country, plus the previous abolition of the slaughter tax, livestock tax and other agricultural-related charges, the peasants' annual burden has been lightened by about 125 billion yuan. With the institution of direct subsidy for grain-growing peasants, subsidy for fine strains, subsidy for purchasing farm machines and tools, and comprehensive direct subsidy of agricultural funds, the annual subsidies have exceeded 30 billion yuan; we have increased transfer payments to counties in financial difficulty and major grain-producing counties, and granted award subsidies of 23.5 billion yuan. Investment for supporting agriculture has continued to increase. Central treasury payments for the "three rural issues" [san nong: agriculture, peasants, and rural areas] reached 339.7 billion yuan (including comprehensive direct subsidy of 12 billion yuan for grain-growing peasants, arranged from the special returns funds on petroleum), 42.2 billion yuan more than in the previous year. Rural production and living conditions have improved. The central treasury invested 6 billion yuan in safe rural drinking water projects, 200 per cent more than in the previous year, while the local authorities put in 6.9 billion yuan, benefiting 28.97 million peasants; the central treasury invested 2.5 billion yuan in rural methane construction, 150 per cent more than in the previous year, while local authorities put in 1.56 billion yuan, increasing the number of households using methane by about 4.5 million; the central treasury arranged 19 billion yuan for rural road improvement projects, while the local authorities put in 24 billion yuan. Altogether 120,000 km of asphalt (cement) rural roads were improved or widened. Optimization of the agricultural structure has continued. The sown area of grain was 1.1 million hectares more than in the previous year, reaching 105.38 million hectares. China again reaped a bumper grain harvest with output at 994.9 billion jin, 26.88 billion jin more than in the previous year.

- Positive changes emerged in economic restructuring. The intensity of industrial restructuring increased. Among industry of scale level and above, output value of hi-tech industry rose by 18.7 per cent, 2.1 percentage points higher than the increase in industry. Substantive breakthroughs were achieved in manufacturing in China major technical equipment such as a complete large set of equipment for hot sheet rolling, and a large cooling system for power stations. New progress was made in the restructuring of sectors with surplus production capacity. The building of self- determined innovation capability was actively promoted. We produced a number of detailed rules on policies associated with self- determined innovation, and there were early-stage demonstrations and proofs for 16 major special science and technology projects. The organization and building of state research centres for projects such as ultrasound in medical care and fuel cells has been completed; there are 92 more enterprise technical centres recognized by the state; and work has started on the first batch of trial- point work for innovation-style enterprises. The service sector has developed steadily, with added value reaching 8.2703 trillion yuan, a rise of 10.3 per cent. The supply capacity of communications and transport has been markedly strengthened. The development of service trades such as material flow dispatch, finance and insurance, and information services has speeded up, and new posture and products in consumer-style service trades are continually springing up. New achievements have been scored in coordinated regional development.

- Social undertakings and work related to the people's livelihood have been stepped up. New progress has been made in giving priority to developing education. In the whole country 83 more counties have passed the "two basics" [liang ji] assessment. A good start has been made in reforming the mechanism for ensuring expenditure for rural compulsory education; in 2005 52 million rural primary and middle school students benefited, with the average annual burden reduced by 140 yuan per primary student and 180 yuan per junior middle student. Free textbooks were provided for 37.3 million students from poor homes in the central and western regions, and subsidies were provided for living expenses for 7.8 million rural boarding students. Senior middle stage education gross enrolment rate has reached 59 per cent, and tertiary education gross enrolment rate has reached 22 per cent. The work of public health system construction and family planning work have been strengthened. State bond funds of 2.7 billion yuan, with associated local funds of 1.7 billion, have supported infrastructure construction for 5,436 township and town clinics and 672 county hospitals, Chinese medicine hospitals, and health institutes for women and children. A community public health service network covering large and medium-sized cities throughout the country has taken initial shape. Development of culture, tourism, and sports undertakings has speeded up. The goal of enabling the peasants of all natural villages of 50 and more households that already have electricity to receive broadcasting and TV has been completely accomplished, and the rural film projection protect has proceeded smoothly. Construction of key cultural projects has steadily progressed, and protection of cultural relics has been further strengthened. Infrastructure construction of red tourism points has been speeded up. Work has started on 30 of the 31 sites and buildings for the Beijing Olympics. The masses have derived more tangible benefit. Average net income of the peasants and average disposable income of urban residents respectively increased by 7.4 per cent and 10.4 per cent in real terms. Twenty- nine provinces (autonomous regions, municipalities) increased their minimum wage standards. The various systems for ensuring that peasant laborers are paid the proper amount on time have been continually perfected. The towns increased the number of jobs by 11.84 million; at yearend the registered unemployed rate in the urban areas was 4.1 per cent. The scope of coverage by social security expanded. There was a big increase in the subsidy standards for recipients of preferential treatment. Policies on compensation for land requisitioning for reservoir area migrants and subsequent support were gradually perfected, and 22.88 million peasants benefited. Total volume of retail sales rose by 13.7 per cent, a rise of 0.8 percentage points over the previous year.

- Energy conservation, emission reduction, and ecological protection have been intensified. The work of energy and resource conservation and development of a cyclic economy has been markedly stepped up. We have published a decision on strengthening energy conservation work, and signed responsibility notes on energy conservation and emission reduction targets with 30 provinces (autonomous regions, municipalities), and the Xinjiang Production and Construction Corps. The system for assessing and examining the energy conservation responsibilities has been initially set up, and the systems for reporting unit GDP energy consumption and unit industrial water conservation in increased value have been formally inaugurated. We have comprehensively carried out 10 focal energy conservation projects. We have unfolded an energy conservation drive in 1,000 high energy consumption enterprises. We have organized and inaugurated the first batch of cyclic economy trial points. Environmental protection and ecological construction have been actively promoted. Clean production has been comprehensively launched, and we have published the list of technological guidance for clean production in key state sectors and the assessment index system. The rate of treating urban sewage and the rate of harmless treatment of urban garbage have respectively reached 56 per cent and 54 per cent, respectively 4 and 2.3 percentage points higher than the previous year. During the year 267,000 hectares of farmland were returned to forest, and 10 million hectares of pasture were returned to grassland.

- New strides have been taken in reform and opening up. Reforms have continued to deepen in key fields and crucial key links. Eight provinces including Beijing and Nei Monggol and some cities and counties have launched trial points in comprehensive rural reforms. The reform of the second batch of 74 central enterprises in separately running social undertakings has been basically completed. Reforms of the management system of monopoly sectors are being actively promoted, and separation of government and enterprise has been initially achieved in management of the post office. The Bank of China and the Bank of Industry and Commerce have successfully been listed. The reform of separate placing of equity of listed companies has been basically completed. Reforms of the investment system are being actively promoted. Positive progress has been made in the price formation mechanism for resource-style products and key elements. The work of deepening the reforms in medicine and public health has started to move. We are carrying out projects for making medium-sized and small industries grow up, and the environment for the development of non-public ownership economy continues to improve. We are actively promoting transformation of the foreign trade growth mode. Total import and export volume was $1.76 trillion, a rise of 23.8 per cent on the previous year.

General Demands and Main Targets of Economic and Social Development in 2007

In economic and social development work in 2007, we must be guided by Deng Xiaoping Theory and the important thinking of the "Three representations," seriously implement the spirit of the 16th Party Congress and the Third, Fourth, Fifth, and sixth plenary sessions of the 16th CCP Central Committee, comprehensively implement the scientific development concept, speed up the building of a socialist harmonious society, and continue to strengthen and improve macro regulation and control; devote efforts to restructuring the economy and transforming the growth mode, to strengthening resource conservation and environmental protection, to promoting reform, opening up, and self-determined innovation, and to promoting social development and resolving problems in the people's livelihood; spur economic and social development to truly switch to the track of scientific development, and make efforts to achieve good and rapid development of the national economy, to create a good environment for the convening of the 17th Party Congress.

In line with these demands, taking account of both requirements and possibilities, and getting in line with the 11th FYP "Outline," we propose the main targets of economic and social development in 2007:

- On the basis of optimizing the structure, enhancing returns, lowering consumption, and reducing emissions, maintain an appropriate economic growth rate.

- There should be no fewer than 9 million new jobs in the towns, and the registered unemployment rate should be controlled below 4.6 per cent.

- Urban residents' average disposable income and the peasants' average net income should rise by 6 per cent in real terms, and social consumer goods retail sales should rise by 12 per cent.

- The general level of consumer price rises should be controlled within 3 per cent.

- Science and technology, education, public health, and cultural undertakings should further develop. Expenditure on research and experiment development should rise to 1.56 per cent of GDP. Gross enrolment for senior middle schools should reach 65 per cent; ordinary higher education schools plan to enrol 5.67 million students and 424,000 graduate students. The building of the public cultural service system should be further stepped up. Trial points for the new-style rural cooperative medical system should be expanded to more than 80 per cent of counties (cities, districts). The natural population growth rate should be controlled at 7.5 per mille.

- The imbalance in the international payments should be improved.

Eight Tasks and Measures in Economic and Social Development in 2007

- Continue to strengthen and improve macro regulation and control, and maintain steady economic operation. Persist in carrying out a sound fiscal policy and monetary policy. Appropriately reduce the central fiscal deficit, and continue to restructure fiscal expenditure. In 2007 the central fiscal deficit is to be controlled at 245 billion yuan, 50 billion less than in the previous year's budget deficit; 80.4 billion yuan are to be arranged within the central budget for current account construction, a rise of 25 billion over the previous year's budget; putting together current and capital accounts, the total scale of central government construction investment is set at 130.4 billion yuan. In accordance with the demands for optimizing the structure, highlighting the focal points, strengthening the weak links, and concentrating forces on major things, ensure that central government construction investment in directly improving rural production and living conditions, in supporting basic education, public health, and other social undertaking development, and in the major development of the western region are all higher than last year. At the same time, step up support for energy conservation, environmental protection, and self-determined innovation. Maintain the most rational increase in money supply, and devote efforts to optimize the credit structure. Maintain basic stability in general price levels. Continue to strengthen regulation and control of investment in fixed assets. Tightly hold the land and credit barriers and the market access threshold, and continue to control the development of sectors with excess production capacity and which are high consumers and heavy polluters. Strengthen the construction of major projects related to the overall economic and social picture and long-term development. Step up supervision and control of investment projects. Devote efforts to expanding consumer demand. The key lies in continually enhancing the income level and consumption capacity of the peasants and low-income urban dwellers. Do a good job in implementing the various policies for regulating and controlling the real estate market, speed up the construction of cheap rent houses and medium and low priced and medium and small suite-style commodity housing, improve and standardize the system for economic use of housing, and improve the housing conditions for low-income households. Crack down according to law on violations of law and regulations in real estate development and deals, and in the intermediate links, and curb the excessively rapid rise in real estate prices. Continue to strengthen the links in coal, electricity, and transport requirements, give priority to coordinating and resolving people's daily life needs, and ensure the needs of key sectors and units such as hospitals, schools, finance, grain, and chemical fertilizer.

- Persist in regarding the development of rural economy as the focal point, and do a sound job in promoting the building of a new socialist countryside. Consolidate, perfect, and strengthen the policies supporting and favouring agriculture, properly step up input in the "three rural issues," and vigorously spur the restructuring of agriculture and rural economy. Steadily develop grain production. Continue to do a good job in the project for high- quality grain industry and the building of large state commodity grain bases. Actively push the building of modern agriculture. Continue to improve rural production and living conditions. This year, resolve the safe drinking water problem for a further 32 million rural people and increase the number of methane-using rural households by 5 million. Support the improvement of county and township roads and the construction of roads leading to villages, and get a good grasp of the improvement of the rural power grid in the central and western regions, and the construction of electric power in areas that do not yet have it. Speed up the development of rural social undertakings. Completely eliminate miscellaneous charges for students in the compulsory education stage in the rural areas. Complete the modern long-range education project for rural middle and primary schools and the task of tackling tough problems in "two basics" in the western regions, continue to carry out the construction project for rural boarding schools, and launch the improvement of junior middle school buildings in the central and western regions. Strengthen the construction of the rural public health service system with the focus on township clinics, and expand the scope of cover of the new-style rural cooperative medical system. Expand the channels by which the peasants can increase income. Further consolidate the investment for supporting agriculture, establish mechanisms for dovetailing programmes and plans for support-agriculture investment and communication to departments, and perfect the input management methods.

- Devote efforts to doing a good job in energy conservation and emission reduction work, and strengthen environmental protection and intensive land use. In order to achieve the goals set by the 11th FYP "Outline" of reducing unit GDP energy consumption by about 20 per cent and reducing emissions of the main pollutants by 10 per cent within five years, it is necessary to advance in the face of the difficulties, adopt still more effective measures, make still greater efforts, and persist in regarding energy conservation and reduction of consumption, pollution reduction, and intensive land use as the breakthrough points and major items to grasp; speed up economic restructuring and transformation of growth mode; vigorously develop service trades and hi-tech industry; encourage the use of advanced technology to transform traditional industry; guide the enterprises to engage in mergers and reorganization; speed up the promotion of withdrawal from the market of those backward productive forces within high energy consumption and high pollution sectors that do not meet market access conditions; and promote intensive development. At the same time, get a good grasp of the following eight items of work: Implement responsibilities for targets, strictly carry out the responsibility system for the targets of energy conservation and consumption reduction and pollution emission reduction, speed up the building of a scientific and unified statistical indicator system and a monitoring system for energy conservation and emission reduction, and put on a sound basis the mechanism for assessing and examining achievements in the work of energy conservation and emission reduction; highlight the key fields; in key sectors and fields such as iron and steel, nonferrous metals, electric power, petroleum and petrochemicals, chemicals, and building materials, use central and local investment to comprehensively carry out 10 major energy conservation projects such as the revamping of low-efficiency coal industrial boilers (kilns), regional thermal power linked production, the use of surplus heat and pressure, conservation of and substitution for oil, and green lighting; launch in depth a drive for energy conservation in 1,000 enterprises, and step up energy source auditing; among key energy consumption sectors, select a number of major energy conservation technologies with great potential and broad utilization, and intensify the tackling of key problems and popularization. Strictly hold the resource pass. Institute an energy conservation assessment and examination system for projects of investment in fixed assets, and regard energy consumption as a compulsory threshold for examining, approving, verifying, and launching construction; improve the power generation dispatch method, and speed up the progress of work on "launching big and suppressing small" [shang da ya xiao] in the thermal power sector; this year we should shut down generator sets totalling 10 million kw in small thermal power stations. All newly built thermal power stations must simultaneously have sulphur removal equipment installed, and plans for treating sulphur dioxide in existing coal-fired power stations will be published. We must strive to knock out 30 million tonnes of production capacity in backward iron smelting facilities, and 35 million tonnes capacity in backward steel smelting facilities. Intensify policy support. Perfect fiscal and taxation policies that help to conserve energy and reduce consumption; the central treasury is setting up a social energy conservation fund to support the popularization of highly efficient energy-saving products, the construction of major energy conservation projects, and technical demonstrations of major energy conservation technologies; perfect the policy of differential electric power and water pricing for high energy consuming and high polluting sectors; all designated cities must start collecting fees for garbage handling within the stipulated deadline. Develop cyclic economy, get a tight grasp of putting together the state cyclic economy development plan, perfect the cyclic economy assessment indices system and statistical system, and spur the first batch of cyclic economy trial points; strengthen environmental protection, and comprehensively promote clean production; impose compulsory clean production verification on enterprises that seriously exceed emission standards, and set a deadline for completing their clean production revamping; do a good job in supervision and inspection, launch special-topic inspections of energy conservation and emission reduction, and step up supervision and inspection of the state of implementation of the responsibility system for targets of energy conservation and emission reduction, of knowledge of the energy conservation targets, and of the energy conservation measures in high consumption enterprises; use land in economical and intensive fashion, and institute the strictest land management system.

- Vigorously strengthen self-determined innovation capability, and give impetus to optimizing and upgrading the industrial structure. Earnestly implement the state outline programme for medium and long-term science and technology development, and table a further batch of detailed regulations for carrying out the associated policies on supporting self-determined innovation. Organize implementation of the major state science and technology projects, build a number of major science and technology infrastructure facilities, organize and build a number of state project laboratories and research centres, select and support a number of state-recognized enterprise technology centres, and give impetus to the reorganization of applied technology research institutes and production enterprises. Continue to build public technology backup platforms, strengthen intermediary services such as technology advice and transfer, and intensify the protection of intellectual property rights. Speed up the development of service trades. Do a good job in planning and project construction in key service trades. Readjust and optimize the industrial structure. Implement the provisional regulations on promoting industrial restructuring and the industrial restructuring guidance list, perfect the system for sector access, speed up the restructuring of sectors with excess production capacity, support and encourage the merger and reorganization of sectors such as iron and steel, cement, electrolytic aluminium, coal, textiles, and paper-making, and knock out according to law backward production capacity. Make extensive use of advanced information technology to revamp traditional industry, and in particular, step up the technological revamping of the iron and steel, building materials, coal, electric power, petroleum and petrochemicals, and construction industries. Strengthen the core competitiveness of hi-tech industries. Continue to carry out hi-tech projects and industrialization projects for bio medicines, integrated circuits, the new generation of mobile telecommunications, the next-generation internet, information security, and so on. Energetically invigorate the equipment manufacturing industry. Develop substitute resources in orderly fashion.

- Implement the general strategy for regional development, and spur coordinated regional economic development. Continue to promote major western development. Organize implementation of the 11th FYP for western development, speed up infrastructure and ecological environmental construction and the development of science, technology, and education. Start work on building a number of new key projects. Intensify coordination and interaction between the eastern, central, and western regions. Actively spur the revival of the northeast and other old industrial bases. Continue to do a good job in trial points in economic transformation in cities where resources are exhausted, and promote the treatment of areas where coal extraction has caved in, and the revamping of shack-dweller areas. Implement the policy measures for promoting the rise of the central region. Strengthen the building of central region grain bases, energy source and raw material bases, advanced manufacturing industry and hi-tech industry bases, and the comprehensive communications and transport system, speed up the optimization and upgrading of the industrial structure, and [make the central region] advance in the front rank in promoting reform and opening up, spurring scientific development, and transforming the growth mode. Speed up economic and social development in old revolutionary bases, ethnic regions, border regions, and poor regions, and intensify support for infrastructure construction and public services in under- developed regions. Unfold layer by layer the work of putting together plans for main body function regions [zhuti gongneng qu]. Put together and complete the planning for state main body function regions, and impel in sound fashion the work of planning provincial- level main body function areas. Actively and steadily promote urbanization. Do a good job in maritime planning, and support the development of maritime economy.

- Continue to deepen the various reforms, and enhance the quality and level of opening up to the world. Actively promote reforms of the administrative management system. Decide on government organ duties in scientific fashion, put the administrative operational system on a sound basis, improve government management and service methods, promote administration according to law, and intensify the system of administrative responsibility for answering questions [wen ze zhi]. Comprehensively deepen the rural reforms. Consolidate and develop the fruits of the rural tax-fee reform. Devote efforts to promoting comprehensive rural reforms. Stabilize and perfect the rural land contract relationship, and ensure the peasants' rights. Continue to spur enterprise reforms. Deepen the system reforms in telecommunications, electric power, civil aviation, and the post office, speed up reforms of the system of fund-raising for railroad investment, and continue to push reforms in the urban public undertakings such as water, gas, and heating supply. Comprehensively implement the policy measures for encouraging, supporting, and guiding the development of non-public ownership economy. Speed up financial reforms and innovations. Steadily promote reforms of the fiscal and tax system. Deepen reforms of the investment system. Perfect the price formation mechanism for resource-style products. Speed up the transformation of the foreign trade growth mode, and improve the quality of use of foreign investment.

- Vigorously develop education, public health, and cultural undertakings, and further strengthen coordination in economic and social development. Persist in the priority development of education. Give impetus to tilting public education towards the rural areas, the central and western regions, poor regions, border regions, and ethnic regions. Perfect the public health and basic medical services system. Gradually build a basic health insurance system covering urban residents. Get a good grasp of studying general lines of thought and policy measures for deepening reforms of the public health and medical system. Vigorously develop culture, broadcasting, film, and television, news and publishing, and sports and so on. Go all-out to make a success of building the Olympic sites. Stabilize the current family planning policy and low birth level, and improve the quality of the new-born population.

- Seriously resolve conspicuous problems involving the masses' vital interests, and spur the building of harmonious society. Continue to carry out a proactive employment policy. Do a really good job in income distribution work. Speed up the building of a social security system. Further perfect the system of ensuring minimum needs for urban residents, and establish throughout the country a system of ensuring minimum living needs for the peasants. Intensify food and drugs safety and production safety work. Continue to launch specific-topic corrections of food and drugs safety, and energetically strengthen supervision and control of food and drugs quality and drinking water safety. Perfect the production safety system mechanism, strengthen main-party responsibility for enterprise production safety, and actively promote the two tough tasks to be tackled, handling of coalmine gas and rectification and closure of mines. Continue to do a good job in poverty relief development, implement the latter-stage support policies for reservoir district migrants, earnestly do a good job in restoration and reconstruction in disaster areas, and safeguard and promote social stability.
source:RedOrbit