Fourth Session of the Tenth National People's Congress
March 5, 2006
National Development and Reform Commission
The National Development and Reform Commission has been entrusted by the State Council to submit this report to the Fourth Session of the Tenth National People's Congress (NPC) on the implementation of the 2005 plan for national economic and social development and on the 2006 draft plan for national economic and social development for your deliberation and approval and also for comments and suggestions from members of the National Committee of the Chinese People's Political Consultative Conference.
II. Overall Requirements and Main Targets for Economic and Social Development in 2006
The year 2006 is the first year for implementing the Eleventh Five-Year Plan and a year that represents a new historic point of departure for China. Success in all aspects of our work for this year is crucial for consolidating and continuing rapid yet steady economic development and smoothly implementing the Eleventh Five-Year Plan. To ensure economic and social development this year and get the Eleventh Five-Year Plan off to a good start, we must take Deng Xiaoping Theory and the important thought of Three Represents as our guide; follow the guiding principles set out at the Sixteenth National Congress of the CPC and the Fifth Plenary Session of the Sixteenth Party Central Committee; continue to take a scientific outlook to guide overall economic and social development; maintain the continuity and stability of our macroeconomic policies; work hard to accelerate reform and opening up; improve our capacity for independent innovation; promote economic restructuring and transformation of the pattern of growth; improve the quality and benefits of economic growth; continue to put problems affecting the vital interests of the people high on our agenda; properly balance reform, development and stability; and promote all aspects of socialist economic, political and cultural development and efforts to create a harmonious society.
On the basis of these requirements, we must follow the principles of maintaining stability in government policy with fine-tuning as needed, always keeping the big picture in mind while paying close attention to key areas, taking all factors into consideration in making overall plans, paying close attention to the well-being of the people, and staying firmly rooted in the present while looking ahead to the future in order to ensure successful economic and social development this year. Taking into consideration the necessity and feasibility of economic and social development, last year's actual performance, and the requirements of the Eleventh Five-Year Plan (draft), we have set the main targets for economic and social development in 2006 as follows.
�C GDP growth around 8%. There are several major factors contributing to the determination of this growth rate. The pressure on resources and the environment is mounting, the economy is still hampered by a number of shortages, and there are still some unstable factors and uncertainties in development. It would therefore be inappropriate to set a higher growth rate. However, based on the need to increase our overall national strength, expand employment and alleviate social conflicts and considering the rapid economic growth we have had in recent years, it would also be inappropriate to set it too low. The target of around 8% is for China's overall economic growth. All localities should set reasonable and appropriate targets based on their conditions, avoid recklessly pursuing and competing for the highest growth rate, and put the main thrust of their effort into improving the quality and benefits of economic growth.
�C Creation of 9 million new jobs for urban residents and confining the registered urban unemployment rate to 4.6%. Employment pressure will remain intense this year, and continued reform and restructuring of enterprises will make it difficult to increase employment over the short term. Estimates based on the relationship between economic growth and job creation indicate that by implementing a vigorous employment policy and gradually improving it, we can attain this target, though it will require a great deal of work.
�C Rise in the consumer price index within 3%. This figure was set slightly higher than the actual rise last year based on several major factors. The high oil price on the international market will raise prices of oil-dependent products in the domestic market. Balancing price relationships among resource products, correcting certain irrational prices and raising prices for some services will drive up the consumer price index somewhat.
�C Increase in the total import and export volume of 15%. We need to maintain a steady increase in import and export volumes. Given that the volume of exports is already rather high and the added value of many export commodities is very low, we should not set too high a target for foreign trade growth in order to help guide all parties concerned to change the way they increase foreign trade, to accelerate improvement of the import and export mix, and to maintain the equilibrium in balance of payments.
�CReduction of energy consumption per unit of GDP of about 4%. China is still in a period of fairly high consumption of resources, and it will take a while for measures to effectively increase energy savings and reduce material consumption to take hold. This will make it hard to meet the target. However, it would be difficult to continue pursuing growth based on inefficient energy consumption, and there is much room to increase energy savings and reduce consumption of materials. Thus, this target must and can be attained as long as we work even harder to restructure the economy and change the extensive pattern of economic growth as soon as possible.
�C Steady increase in urban and rural incomes. The per capita disposable income of urban residents and the per capita net income of rural residents are expected to increase by 6% and 5% respectively in real terms. We arrived at these figures by taking several major factors into account. Rapid economic growth, continued improvement of the economic performance of enterprises, and gradual implementation of government measures to increase rural incomes and to strengthen social security and poverty alleviation work should all contribute to a steady increase in urban and rural incomes. However, there are quite a few difficulties that could slow the rise in personal incomes, particularly in rural incomes. Based on a steady increase in urban and rural incomes, consumer demand should continue to see steady and rapid growth this year, resulting in an expected 12% increase in retail sales of consumer goods nationwide.
�CFaster development of science and technology, education and other social programs. We will strive to bring spending on R&D up to 1.45% of GDP. The secondary gross enrollment ratio should reach 57%, and plans call for enrolling 5.3 million undergraduate students and 400,000 graduate students in regular institutions of higher learning. The development of the system of public cultural services will be strengthened. The trial reform of a new type of rural cooperative medical care system will be expanded to about 40% of all counties (and county-level districts and cities) in China. The natural population growth rate should be confined below 7.5��.
�C Continued improvement of the natural environment. The total discharge of major pollutants will be reduced by 2%. We will increase the percentage of industrial solid waste that is comprehensively utilized to 56.2% and the percentage of urban sewage that is properly treated to 50%.