III. Suggestions for the work of the government this year

Based on an understanding of the work of the past ten years, especially of the past five years, I wish to make the following suggestions for the government's main work this year.

1. Accelerating the change of the growth model and promoting sustained and sound economic development

All the achievements we have made in China's socialist modernization are attributable to sustained and sound economic development, without which we would have accomplished nothing.

China is still in the primary stage of socialism and will remain so for a long time. This basic national condition has not changed; nor has the principal problem in our society, that is, production falls short of the ever-growing material and cultural needs of the people, or China's international position as the largest developing country in the world. Development is still the key to solving all our problems. We must keep economic development as the central task and give it our undivided attention.

As long as we make full use of this important period of strategic opportunities, respect the law of development, formulate new thinking on development, solve problems hindering development, accelerate the change of the growth model, spur change in the course of pursuing development, and promote development while working for change, we can certainly achieve sustained and sound economic development.

We should unswervingly take expanding domestic demand as our long-term strategy for economic development, and make full use of the basic function of consumption and the key role of investment. The difficulty in and key to expanding domestic demand lie in consumption, and that is also where the potential lies. To expand individual consumption, we should enhance people's ability to consume, keep their consumption expectations stable, boost their desire to consume, improve the consumption environment and make economic growth more consumption-driven.

In the current stage, the role investment plays in promoting economic growth cannot be underestimated. China has both investment capability and investment demand, but the key is to make investment in the needed sectors, optimize the structure of investment, and improve its performance and returns. Governmental investment is important in guiding nongovernmental investment, but its share of the country's total investment is decreasing, so we must further relax controls over market access for nongovernmental investment and stimulate it.

We should energetically change the growth model and speed up structural adjustment of industry. China's productive forces develop on multiple levels, which gives us plenty of room to maneuver. Industries, whether traditional or emerging, labor-intensive or capital-intensive, all have room for development. The important task is to optimize resources allocation and industrial distribution, and solve the following problems: excess production capacity, the lack of core technology, products with low value-added, low-level and redundant industrial projects, and different regions having similar industrial structures. We must accelerate the transformation and upgrading of traditional industries, energetically develop new- and high-tech industries, and raise product quality and competitiveness.

We should strengthen policy guidance; encourage enterprise acquisitions and reorganizations across industries, regions and forms of ownership; and allow market forces to determine enterprises' success or failure.

We should promote sound development of strategic emerging industries, with the focus on expanding their share in the domestic market and making breakthroughs in major and key technologies. We should promote the integration of IT application and industrialization, more quickly build next-generation information and communication infrastructure, and spread the use of information network technology.

We should develop and expand the service sector, and attach equal importance to producer and consumer service industries and to modern and traditional service industries.

In response to people's expectations of having a good living environment, we should greatly strengthen ecological improvement and environmental protection. The state of the ecological environment affects the level of people's wellbeing and also posterity and the future of our nation. We should adhere to the basic state policy of conserving resources and protecting the environment and endeavor to promote green, circular, and low-carbon development.

We should greatly boost the conservation and reuse of energy and resources, give priority to saving energy in industry, transportation and construction and in public institutions, restrict total energy consumption, and reduce energy and materials consumption and carbon dioxide emissions. We should speed up adjusting the economic structure and distribution and upgrading related standards, practices, and laws and regulations. We should adopt effective measures to prevent and control pollution and change the way we work and live. We should resolve to solve the problems of serious air, water, and soil pollution that affect the people's vital interests; improve environmental quality, and safeguard people's health, and give the people hope through our concrete action and achievements. We should do our meteorological, geological and seismic work well and become better able to prevent and mitigate natural disasters. We should optimize development of the country's territory, carry out development at a proper pace and adjust its spatial layout. We should strengthen comprehensive marine management, develop the marine economy, become better able to exploit marine resources, protect the marine ecological environment, and safeguard China's maritime rights and interests.

We should continue to fully implement the master strategy for regional development and promote balanced development between regions. We should make full use of the comparative strengths of each region, make plans comprehensively and give guidance tailored to different circumstances. We should give high priority to large-scale development of the western region, fully revitalize the old industrial bases in northeast China, spur the rise of the central region, and support the eastern region in taking the lead in development. We should increase support for old revolutionary base areas, ethnic minority areas, border areas and poor areas and alleviate poverty in contiguous areas with acute difficulties.

2. Strengthening the foundation for agriculture and rural development and promoting integrated urban and rural development

In recent years, China's agriculture has developed faster, its rural areas have undergone more significant changes, and its rural residents have received more tangible benefits than in any other period. Agriculture and rural development in China have now entered a new stage in which overall agricultural production costs are rising, structural problems in the supply and demand of agricultural products are worsening, the rural social structure is undergoing profound changes, and integration of urban and rural development is speeding up. All the major and difficult problems that we face in finishing building a moderately prosperous society in all respects are in rural areas. We must make solving issues relating to agriculture, rural areas and farmers the number one priority in all our work. This is a scientific conclusion drawn from our historical experience and a long-term guiding principle applicable to both the present and the future. The rural land system is central to maintaining rural stability and ensuring China's long-term development. Its main purpose is to guarantee farmers' property rights and interests, and its main objective is to ensure that China's farmland remains at or above the red line of 120 million hectares. We should continue to make household contracts the basis of rural operations, support the development of new farmers' cooperatives of various forms and multilevel commercial organizations that provide agricultural services, and gradually establish a new type of system of intensive agricultural operations that are specialized, well organized and commercialized. We should always protect farmers' legitimate property rights and keep them motivated. We should always give high priority to grain production, develop high-yield basic farmland, spread advanced technologies, increase overall agricultural production capacity, and effectively ensure the supply of grain and other important agricultural products. We should continue to increase spending on agriculture, rural areas and farmers; improve infrastructure and basic public services in rural areas; and promote integration of urban and rural development. We should build a new type of relations between industry and agriculture and between urban and rural areas in which industry promotes agriculture, urban areas support rural development, industry and agriculture reinforce each other, and urban development and rural development are integrated. We should take effective measures to keep the agricultural workforce stable and train a new type of farmers.

Urbanization is a historical task in China's modernization drive, and urbanization and agricultural modernization complement each other. We should conform to the objective law of urbanization and carry it out actively yet prudently. We should promote sound development of urbanization by making plans scientifically, balancing geographical distribution, coordinating urban and rural development, using land economically, and tailoring measures to local conditions. Megacities and large cities should be kept at an appropriate scale and fully play their role in driving the development of their surrounding areas. Small and medium-sized cities and small towns should become better able to develop industries, provide public services, create jobs, and attract residents. We should accelerate reform of the household registration system, the social management system and related institutions; register eligible rural workers as permanent urban residents in an orderly manner; progressively expand the coverage of basic public services in urban areas to all their permanent residents; and create an equitable institutional environment for freedom of movement and for people to live and work in contentment. In improving village conditions, we should preserve their distinctive rural flavor, make their environment more livable, and ensure that urbanization and the building of a new countryside reinforce each other.