Full Text: Report on China's Economic and Social Development Plan

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I. Implementation of the 2011 Plan for National Economic and Social Development

II. Overall Requirements and Major Objectives for Economic and Social Development in 2012

III. Major Tasks and Measures for Economic and Social Development in 2012

II. Overall Requirements and Major Objectives for Economic and Social Development in 2012

When doing this year's economic and social development work, we must fully implement the guidelines adopted at the Party's Seventeenth National Congress and the third through sixth sessions of the Seventeenth Central Committee; take Deng Xiaoping Theory and the important thought of Three Represents as our guide; and thoroughly apply the Scientific Outlook on Development. We need to continue to follow a proactive fiscal policy and a prudent monetary policy; ensure the continuity and consistency of macroeconomic policies; and make our macro-control more targeted, flexible and future-oriented. We will continue to correctly handle the relationship between maintaining steady and robust economic development, restructuring the economy and managing inflation expectations, and accelerate the transformation of the pattern of economic development and economic restructuring. We will strive to boost domestic demand, strengthen independent innovation as well as energy conservation and emissions reduction, deepen reform and opening up, and ensure and improve the people's wellbeing, so as to maintain steady and robust economic development, keep the overall price level basically stable, safeguard social harmony and stability, and greet the coming Eighteenth National Congress of the CPC with outstanding achievements in economic and social development. In view of the above overall requirements and what is needed versus what is possible, and in conformity with the Twelfth Five-Year Plan, we have set the following major objectives for economic and social development in 2012.

-- Maintaining steady and robust economic growth. China's GDP will grow by 7.5%, 0.5 percentage points lower than last year. In setting this target, we have mainly taken the following factors into account. First, we have considered changes in the trends in the economies of both China and other countries and their growth rates. The global financial crisis continues to profoundly impact the world economy, and we face arduous tasks at home in maintaining steady economic growth, keeping prices stable, and transforming the pattern of economic development, so to set this year's growth rate properly lower better reflects these economic trends. At the same time, 7.5% is still a comparatively high rate after we consider the overall size of our economy and the unfavorable external conditions, and we need to work very hard to attain it. Second, this target is the first step toward the goal of GDP growth, as set in the Twelfth Five-Year Plan, and by setting it we will guide all localities to focus their work more on restructuring the economy, transforming its development pattern, and improving the quality and effect of its growth. Third, after fully considering the bearing capacity of resources and the environment, we believe a growth target properly lower than that of 2011 is conducive to easing the ever-growing resource and environmental constraints on economic development and alleviating serious conflicts in the country's economic activities.

-- Improving and upgrading the economic structure. We will continue to increase government spending on science and technology and further increase spending on R&D as a percentage of GDP; develop agriculture steadily and increase supply of agricultural products; energetically develop strategic emerging industries, promote deep fusion of informationization and industrialization, and make continued progress in transforming and upgrading traditional industries; accelerate the development of the service sector and raise its value-added contribution to GDP; and intensify efforts to conserve energy and reduce emissions in order to reduce energy consumption per unit of GDP by about 3.5%, decrease the intensity of carbon dioxide emissions by a bigger percentage, cut chemical oxygen demand and emissions of sulfur dioxide both by 2% and total ammonia nitrogen by 1.5%, and stop the emissions of nitrogen oxide from increasing. Our main consideration in setting these targets is that developments and changes in the domestic and international economic environments have caused quite a few difficulties and challenges to the country's economic development, which, in effect, pressure us to carry out economic restructuring. We need to take scientific development as the theme and accelerating transformation of the pattern of economic development as the main thread of our work; promote industrial upgrading by relying on scientific, technological and institutional innovation; promote higher-level, coordinated development of primary, secondary and tertiary industries; improve the incentive and restraint mechanisms for energy conservation and emissions reduction; greatly deepen economic restructuring; and make development more balanced, coordinated and sustainable.

-- Keeping the overall price level basically stable. We will keep the CPI increase around 4%, lower than the actual increase in 2011. We have mainly considered the following factors when setting this target. On the one hand, currently, aggregate supply and aggregate demand in China are basically in equilibrium and there is an ample supply of most products -- grain in particular, as a result of eight consecutive years of increase in grain production, and all this has provided the material basis for keeping the overall price level basically stable. Furthermore, short-term factors causing prices to rise excessively fast are having less effect, and the carry-over effect of the CPI increase at the end of last year will contribute about 1.1 percentage points to this year's CPI growth rate, which is smaller than last year. On the other hand, prices for factors of production are on a trend of long-term increase, and rising costs will inevitably continue to drive up prices of products; the effect of imported inflation cannot be underestimated due to the continued existence of abundant global liquidity; and, we also need to leave space for alleviating price irrationality and pressing ahead with price reforms.

-- Continuing to improve the people's lives. We will increase urban jobs by more than nine million and keep the rates for urban registered unemployment and natural population growth under 4.6% and 6.5‰, respectively; raise urban and rural real incomes in step with economic growth; extend the new type of old-age insurance for rural residents and the old-age insurance for non-working urban residents to cover all counties or county-level cities and districts; and basically complete work on a total of five million units of low-income housing projects and start work on an additional seven million plus units in urban areas. Our main consideration in setting these targets is that in 2012, our country's economic growth might slow down, and we will face numerous difficulties and challenges in the efforts to further expand employment, increase personal incomes, and improve the social security system. Bearing this in mind, we need to correctly handle the relationship between developing the economy and improving the people's lives by attaching even greater importance to ensuring and improving the people's wellbeing; increase investment and improve the institutional framework; work harder to properly solve practical problems that concern the immediate interests of the people; and successfully accomplish all the above targets.

-- Further improving the balance of payments. China's import and export volume is expected to increase about 10%. We will further reduce trade surplus and quickly develop trade in services; and we will continue to optimize the structure of foreign investment utilization and steadily expand Chinese investment overseas. In setting these targets, we have taken into account the following factors. The environment for global economic development as a whole is not likely to improve noticeably this year, and our exports will face grim situations of growing trade and investment protectionism and sluggish external demand. Even so, we have overall advantages when we participate in economic globalization in all directions, at multiple levels and in all areas, as the quality of our workforce continues to improve, technological innovation speeds up, and our enterprises become more capable of expanding international markets. So, as long as we successfully implement a more active opening up strategy, accelerate change in the way we develop our foreign trade, quickly seize every new opportunity created by changes in international markets, and strive to strengthen traditional markets while opening up new ones, we can surely stabilize and expand the international market share that we have worked so hard for and maintain steady development of foreign trade.

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