Lawmakers urge innovation-driven economic growth

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Chinese legislators on Thursday pushed for an innovation-driven economic growth pattern and urged government officials to refrain from worshipping economic growth.

While maintaining a reasonable speed of economic growth, China should seek a quality, efficient growth pattern, Zhang Yunchuan said at the ongoing bimonthly session of the National People's Congress (NPC) Standing Committee.

Zhang, vice chairman of the NPC's Environment Protection and Resources Conservation Committee, said China's economic development mode has become more "mature," meaning the country is gradually shifting from the traditional growth pattern based on GDP worship to more sustainable development.

To secure sound economic growth in the next five to 10 years, the legislator proposed more investment to increase China's capacity for scientific and technological innovation and an innovation-driven economic growth mode.

China should step up its industrial restructuring and consider a growth pattern that will be conducive to its long-term development interests, according to the legislator.

Zhang made the remarks when joining other legislators in a panel discussion to deliberate on a State Council report on the implementation of China's economic and social development plan and another report on budget implementation.

Zhou Haibo, a legislator from Guangdong Province, said some officials still place great stock in the growth rate, because economic growth is an important factor to consider if officials want to get promoted.

China has set its annual economic growth target at 7.5 percent for 2013.

China's economy is slowing down, easing to 7.5 percent growth in the second quarter from 7.7 percent in the first three months. Worries are growing that the prolonged slowdown could affect the global economy.

At Thursday's panel discussion, lawmakers called for tolerance to the slowdown in the first half of 2013 even if authorities have been accustomed to something more rapid.

"The current economic growth rate is still higher than the 7 percent set out in the Twelfth Five-Year Plan (2011-2015)," said Cai Fang, another legislator, who added that the growth rate now is acceptable, tolerable and appropriate.

"There is no need to stimulate domestic demand via employing a large number of stimulus policies if we accept the current rate," Cai said.

According to State Council's reports, the country's economic growth hit 7.6 percent in the first six months, higher than the annual target, while its consumer price index (CPI), a main measure of inflation, saw a "moderate and controllable" rise.

Zhang added that the country needs to keep its CPI at a "stable and controllable" level so that ordinary people's living will not be affected by increasing living expenses.

Zhou Haibo also believed it is important to rein in the CPI. "After all, what common people care most about is the price of their living necessities," he said.

SOLUTIONS TO ECONOMIC PROBLEMS

At Thursday's panel discussion, NPC deputies examined economic risks that they believe could affect growth.

Local governments are ignoring overcapacity in some industries and approving expansion, legislators said. To address the issue, NPC deputy Wang Mingwen proposed tightened approval of new projects.

Legislators also underlined growing local government debt, fearing such debt will increase the credit risk of banks. Local government debts are currently being audited and the results are yet to be published.

NPC deputy Yao Sheng believes local government debt would be better managed under the supervision of local legislatures.

Local governments will have to pay off a lot of debt in the next three years, said legislator Yin Zhongqing, who wants to regulate local government finances to prevent mismanagement and fraud.

Many legislators drew attention to soaring housing prices. According to the report on budget implementation, in the first seven months, the revenue generated from state-owned land sales registered a year-on-year increase of 49.4 percent.

Legislator Yin Zhongqing warned of the systemic risk of the real estate industry. Yin proposed "letting the air out of the real-estate bubble," a reform of property tax and strict management of land sales.

Lawmakers also called for ecological and environmental protection. "Ozone has been ignored because of the focus on PM 2.5," said Liu Zhengkui.