CPPCC Members Hail New Strategic Restructuring Plan

The Tenth Five-Year Plan for National Economic and Social Development (2001-2005), which will be put into execution this year, marks the beginning of a new around of strategically important economic restructuring.

This is among the hot topics of discussion among members of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) attending the current session of China's top advisory body.

According to the new five-year plan, China will readjust the structure of its agriculture and rural economy, continue to beef up the IT industry, develop the service sector, give priority to high-tech industries, accelerate the pace of urbanization, and launch the strategy of developing the less-developed western region in an all-around manner.

"China's economy has reached such a stage that it eludes any further progress without readjustments," said Xiao Zhuoji, a law professor from Beijing University.

The existing industrial structure, which was shaped up to serve the planned economy, is irrational and hampers the country's modernization drive and its involvement in economic globalization, Xiao said. He called for greater efforts to develop the service, high-tech, banking and IT sectors.

After two decades of reform, great changes have taken place in China. Gone are the days when Chinese suffered from the dearth of commodities. In fact, the whole world is changing admist the sweeping technological revolution, structural readjustments, and economic globalization.

Economist Dong Fureng spoke highly of the readjustments advanced by the new five-year plan. "It is not an "adaptability" restructuring in its general sense as in the past," he noted. "it is a new round of restructuring that is motivated by the new technological revolution and will have a significant bearing on the whole economic situation and long-term development". "It is not local. It is an all-around restructuring covering the industrial structure, regional structure and town-and-country structure," he stressed.

Lin Yifu, director of the China Economic Research Center of Beijing University, said that the possibility of changes in the economic structure of a country depends on the speed of technological progress. Technology factor is crucial to China's industrial restructuring, Lin stressed.

The new five-year plan makes the expansion of domestic demands a "long-term" principle of strategic importance. The intrinsic logic is that expanding domestic demand would provide greater leeway for maneuver and enhance the resistance against international economic risks in the complicated and capricious international environment, said observers.

The adjustment of regional and town-and-country structures should be the two focal points aimed at stimulating domestic demand, said Prof. Lin Yifu. The western China development drive that started last year is sure to bring about an harmonious development among the eastern, middle and western regions and accelerate urbanization in that part of the country.

Professor Xiao Zuoji said that structural adjustment should be left to the market forces in order to make enterprises more active, more competitive and more capable of innovation. In the past, he said, structural adjustment used to be done by the government through administrative means, thus resulting in "forced marriage", "ownership discrimination" and "violation of economic principles". Often than not, such structural adjustments were resisted by localities out of protectionism, he noted.

Zhou Shulian, a researcher from the Institute of Industrial Economics of the Chinese Academy of Social Sciences, called for the setting up of a mechanism that can ensure the effective raising, rational distribution and efficient use of financial, human and technical resources in the optimization and upgrading of structure.

Wang Mengkui, director of the Development Research Center of the State Council, believed that the structural adjustment is in no way a matter of a few years, as the development of high and new technology industries and the transformation of traditional ones will run throughout the whole modernization process and it will take half a century or even longer to realize the movement of the rural population into non-agricultural activities and to make the western part of the country really developed.

"The official launching of this new round of strategic restructuring marks a new stage of development for China's economy, " the economist said.






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