To sum up, despite complex situations both at home and abroad, we still made considerable achievements-our country's economic growth rate was still faster than most countries in the world; the quality and efficacy of development grew; the economic structure was further improved; increases in living standards were sustained; and ecosystems and the environment also saw some improvement. These achievements have not come easily. They are a result of the correct leadership of the Party Central Committee and the State Council, the collective hard work of all regions and departments,and the concerted efforts of the people of all our ethnic groups.
While recognizing our achievements, we are also keenly aware that the world economy is still undergoing profound adjustment and that impetus for economic recovery is lacking, instabilities and uncertainties are increasing, international investment and trade are inadequate, and protectionism and other inward-looking trends are on the rise. China's economy is still without a solid enough foundation for ensuring steady development and still faces a number of acute problems.
First, the real economy is beset by a structural imbalance between supply and demand. The majority of production capacity within the supply system can only meet demand for products that are at the middle-to-low end or are of a low price or poor quality. Upgrading within the consumption structure is occurring at an increasingly faster pace; by contrast, export and investment demand are decreasing. These new changes in demand are something that the supply structure has yet to properly adapt to.
Second, growth in effective demand is weak. Effective investment is growing slowly, particularly investment from private sources and in manufacturing. The delayed impact of downward economic pressure on employment, income, and consumption is now starting to show. The increasingly complex and challenging situation relating to China's foreign trade development is marked by persistently weak international demand, rising costs for multiple factors of production at home, and an increase in the pace at which industries and orders for goods are shifting to other countries.
Third, some regions, industries, and enterprises are confronted with serious difficulties. Resource-dependent areas and strongholds of traditional industry are experiencing severe downward pressure and great difficulties in development. There is a possibility that the effects of divergent growth trends and adjustments, which some industries are experiencing, will end up being transmitted throughout the industry chain. Having been pressed by insufficient market demand and comparatively high operational costs, the ability of enterprises to make a profit has decreased and a greater number of enterprises are suffering losses.
Fourth, risks are mounting in some sectors. Notable imbalances exist between government revenue and expenditures in some localities; greater efforts need to be made to guard against and control financial risks; and the real estate market is still facing serious structural challenges on two fronts, with exorbitant housing prices in some cities and overabundant inventory in others.
Fifth, environmental problems such as smog are still grave. Frequent and prolonged periods of heavy smog extending across large areas have greatly affected the work and lives of our people. At the same time, new problems in relation to workplace safety, food and medicine quality, and the people's wellbeing are also emerging.
We must give top priority to these issues, carry out studies and analysis to correctly assess the domestic and international situations, increase our awareness of potential dangers and of the lines that are not to be crossed, and maintain strategic resolve so as to ensure we produce a more effective response.
II. Requirements, Objectives, and Policies for Economic and Social Development in 2017
2017 is an important year in implementing the 13th Five-Year Plan (2016-2020) and in carrying out further supply-side structural reform. 2017 will also witness the convocation of the 19th National Congress of the CPC, an event of far-reaching significance. So it is of paramount importance for us to effectively carry out our economic work over the coming year.
1. General Requirements
The requirements for 2017 are as follows:
-- uphold the leadership of the CPC Central Committee with Comrade Xi Jinping at its core
-- hold high the great banner of socialism with Chinese characteristics
-- fully implement the guidelines from the 18th National Party Congress and from the third, fourth, fifth, and sixth plenary sessions of the 18th Party Central Committee
-- follow the guidance of Deng Xiaoping Theory, the Theory of Three Represents, and the Scientific Outlook on Development
-- put into practice the guiding principles from General Secretary Xi Jinping's major addresses and his new concepts, thoughts, and strategies on the governance of China
-- promote coordinated economic, political, cultural, social,and ecological progress and balanced implementation of the Four-Pronged Comprehensive Strategy*
-- seek progress while keeping performance stable
-- build a strong understanding of and put into practice China's new development philosophy
-- adapt to, approach in the right way, and steer the new normal in economic development
-- take strengthening the quality and benefits of development as a core priority
-- ensure macro policies are stable, industrial policies are targeted, micro policies are flexible, reform policies are practical, and that social policies ensure basic needs are met
-- focus on supply-side structural reform
-- expand aggregate demand as appropriate
-- better guide expectations
-- ensure development is increasingly innovation-driven
-- work to keep growth stable, promote reform, make structural adjustments, improve living standards, and guard against risks
-- maintain stable and sound economic development as well as social harmony and stability
Fulfilling these requirements should ensure that we greet the 19th National Party Congress with outstanding achievements.
2. Main Objectives
Keeping the above requirements in mind and fully considering both what is necessary and what is possible, we have set the following objectives for economic and social development in 2017:
-- Economic growth within an appropriate range
GDP is projected to grow by 6.5% approximately; however in practice, we will strive for better. In setting this objective, we have taken the following into account:
First, the projected GDP growth rate is in keeping with conditions in China. Our country is in a new normal in economic development, having shifted from a high to a medium-high growth rate. In 2016 China's aggregate economic output exceeded 74 trillion yuan; and this year's projected growth rate of around 6.5% will result in a larger increase in economic output than last year's increase resulting from a 6.7% growth rate. Moreover, a growth rate of 6.5% is much higher than most major economies.
Second, the projected growth rate is in line with the goal of finishing building a moderately prosperous society in all respects. China's economy grew by 6.7% in 2016, so an average growth rate of around 6.5% over the next four years would be sufficient to accomplish the objective set out in the 13th Five-Year Plan to ensure that China's GDP in 2020 is double what it was in 2010. (more)
* To make comprehensive moves to finish building a moderately prosperous society in all respects, deepen reform, advance the law-based governance of China, and strengthen Party self-governance.