II. What China Aims to Achieve by Pursuing Peaceful Development
China's overall goal of pursuing peaceful development is to promote development and harmony domestically and pursue cooperation and peace internationally. Specifically, this means that China will endeavor to make life better for its people and contribute to human progress through hard work, innovation and reform carried out by the Chinese people and growing long-term friendly relations and promoting equality and mutually-beneficial cooperation with other countries. This has become a national commitment which is manifest in strategies for national development, and progress made in the course of China's development.
To achieve modernization and common prosperity for the people is the overall goal of China's pursuit of peaceful development. Following the introduction of the policies of reform and opening-up to the outside world in the late 1970s, China adopted and implemented a three-step strategy for achieving modernization. The first step was to double the GNP of 1980 and ensure people's basic living needs. The second step was to redouble the output of 1980 and achieve initial prosperity by the end of the 20th century. The goals of these two steps have been met. The third step aims to make the per capita GNP reach the level of that of the medium-developed countries, bring about general prosperity, basically realize modernization and build China into a rich, strong, democratic, civilized, harmonious and modern socialist country by the 100th anniversary of the People's Republic of China in the mid-21st century. The central goal of this three-step development strategy is to improve people's material and cultural lives, and make the people rich and the country strong. Meanwhile, as its comprehensive strength increases, China will shoulder corresponding international responsibilities and obligations.
To build a society of higher-level initial prosperity in an all-round way which benefits over one billion Chinese people is the medium-and long-term goal of China's pursuit of peaceful development. By 2020, China will have built a society of higher-level initial prosperity in an all-round way that benefits the over one billion Chinese people. This will make China a country which has basically realized industrialization, significantly increased its comprehensive national strength and taken the lead in the world in terms of the total size of the domestic market. The general living standard and quality of life of the Chinese people will be raised, and the country's natural environment will be well protected. The Chinese people will enjoy full democratic rights, are better educated and pursue common aspirations. China's social system and institutions will be further improved, the Chinese society will be more dynamic, stable and unified, and China will be a more open and engaging country and contribute more to human civilization.
To implement the Twelfth Five-Year Plan of development is the near and medium-term goal of China's pursuit of peaceful development. To build a society of initial prosperity in an all-round way, the Outline of the Twelfth Five-Year Plan for National Economic and Social Development of the People's Republic of China (2011-2015) laid down the guiding principles, goals and major tasks for this period. In the coming five years, China will focus on scientific development and accelerate the shifting of model of growth in pursuing economic and social development, and efforts will be made to achieve the following goals: ensuring stable and fairly fast development of the economy, making great progress in carrying out strategic adjustment of the economy, significantly improving science, technology and education, making major progress in saving resources and protecting the environment, continuing to improve people's lives, enhancing social services and further deepening the reform and opening-up to the outside world. Through the concerted efforts of the Chinese people, we will make major progress in shifting the model of growth, markedly improve China's comprehensive strength, international competitiveness and the ability to ward off risks and consolidate the foundation for building a society of initial prosperity in an all-round way. Meanwhile, China will energetically conduct international exchanges and cooperation, and expand and deepen the shared interests of all countries to promote common development.
From ensuring people's basic living needs to building a society of initial prosperity and then to reaching the level of the medium-developed countries -- this is what China's strategy for peaceful development is all about. To reach these goals, China will make the following efforts:
-- Accelerating the shifting of the model of growth
Making adjustment of the economic sectors will receive top priority. Domestic demand, especially consumer demand, will be stimulated by increasing individual consumption through multiple channels and by adjusting and improving the domestic investment mix. Industrialization, urbanization and agricultural modernization will be promoted simultaneously so that economic growth will be driven by the combined forces of consumption, investment and export instead of investment and export only. China's economic growth will be driven by the combined forces of the primary, secondary and tertiary sectors instead of the secondary sector only. It will also be driven by progress in R&D, better quality of the labor force and managerial innovation instead of increase of material and resource consumption. Moreover, we are carrying out strategies of accelerating development through developing science and technology, and fostering people with capabilities to build China into a country of innovation. We should be open to new ideas and be innovative in improving institutions, draw on the advanced technologies and managerial expertise of other countries, and improve the sustainability and efficiency of economic growth.
We will make more efforts to remove bottlenecks in resources and the environment that impede development. We will adopt a green and low-carbon development approach with emphasis on energy-saving and emission reduction, and accelerate the forming of energy-saving and eco-friendly modes of production and consumption. We will build a circular economy, improve environmental quality, build safe, stable, efficient, clean and modern energy industries, enhance resources supply, promote harmonious development between man and nature, and strike a balance among economic development, population, resources and the environment. We will explore a new path towards industrialization based on science and technology, with high economic returns, low consumption of resources, less pollution, and full utilization of human resources. The all-round, coordinated and sustainable growth of China's economy will create great space for the growth of the world economy.
-- Further exploiting China's domestic resources and its market strengths
With abundant human and material resources and a fairly complete industrial system, China will mainly rely on itself in pursuing sustainable development. It is estimated that by 2015 the number of skilled personnel will reach 156 million in China, 15% of the workforce will have received higher education, and the rate of contribution to economic growth by skilled people will reach 32%. This will ensure ample supply of quality labor force to sustain China's economic development. China ranks among the first in the world in terms of deposits of mineral resources and farmland and is basically self sufficient in grain supply. Although China's per capita share of resources is low, we can minimize dependence on resources by China's economic and social development by giving full play to market's role of resources allocation and progress in R&D. China will fully tap the strengths of its industries of raw material, equipment manufacturing and consumer goods production to meet the consumption demands of the Chinese people and provide more quality goods and services to the international market.
The size of China's population and its total economic output mean a huge potential of domestic demand. With the continuous increase of per capita income, steady growth of domestic investment, and further progress in implementing the strategy for regional development, China will see the emergence of growth engines and its market will further expand. In the coming five years, China's consumption structure will be further upgraded, and the potential of individual consumption will be further released. The size of China's domestic market will be one of the biggest in the world, and the accumulated import volume is expected to reach US$8 trillion. All this will create more business opportunities to other countries.
-- Accelerating the building of a harmonious society
China will accelerate the building of a harmonious society with emphasis on improving people's lives, thus strengthening the foundation of achieving social harmony. It will accelerate the reform of social systems, improve basic public services, develop new mechanisms for social management and make such management more efficient, and improve income distribution and the social security system. Our goal is to ensure that all people have the right to education, employment and pay, medical and old-age services and housing, so that all the people share the responsibility of creating a harmonious society and enjoy life and the full benefit of development in such a society.
We will strengthen the building of socialist democracy, advance the political structural reform actively and steadily, develop socialist democracy and turn China into a socialist country under the rule of law and ensure that the people control their own destiny. We will continue to conduct democratic election, decision-making, governance and supervision in accordance with the law, uphold people's right to have access to information, to participate in governance, to express their views and to supervise the government, and we will expand orderly public participation in the political process. We will continue to treat all ethnic groups as equals and practice the system of regional autonomy of ethnic minorities, protect people's freedom of religious belief according to law, and fully respect and uphold basic human rights and other lawful rights and interests of citizens.
-- Implementing the opening-up strategy of mutual benefit
China will continue to pursue the basic state policy of opening up to the outside world and the opening-up strategy of mutual benefit. By making full use of the favorable conditions created by economic globalization and regional economic cooperation in the course of opening-up, we will move away from focusing on export and absorbing foreign investment towards putting equal emphasis on import and export and on absorbing foreign investment and making overseas investment. We will continuously explore new ways of opening up and improving the open economic system and make the open economy work better so as to promote China's development, reform and innovation through opening-up.
We will speed up the way of conducting foreign trade and continue to actively participate in international division of labor. We will move away from focusing on increasing volume of trade only to improving the quality and efficiency of trade, and raise the overall competitiveness of China's foreign trade instead of relying on low cost production. We will make great efforts to promote service trade, increase import, and bring about basic balance of payment in international trade. We oppose trade protectionism and handle properly frictions in international trade.
We will make better use of foreign investment by continuously improving the investment structure, diversifying ways of investment and expanding investment channels. We will also speed up the introduction of intellectual resources, talented people and new technologies, and encourage foreign investment in key areas and regions. We will protect the legitimate rights and interests of foreign companies in China, adopt an open attitude towards foreign capital and advanced technologies, and foster a fair and orderly investment environment. We will continue to implement the national strategy for intellectual property rights and enhance ability to create, apply, protect and manage intellectual property.
We will attach greater importance to overseas investment and international cooperation. We encourage companies of all types to make overseas investment and engage in joint operations in an orderly way, make R&D-related investment and undertake overseas project contracting and provide labor services. In addition, we will expand international cooperation in agriculture and deepen mutually beneficial cooperation with other countries in the development of energy and other resources. We will undertake more cooperation projects in host countries which improve life of the local people and enhance the ability for self-development of the host countries. The Chinese companies are requested to respect local religions and customs, observe local laws, undertake due social responsibilities and obligations, and promote the development of the host countries. We will improve and develop new ways of providing aid so as to make aid more effective.
We will continue to open China's financial market and financial sectors in an orderly way. We will build a financial system that provides efficient services and places risks under control. We will improve the managed, floating exchange rate system based on market supply and demand, and make the RMB convertible under capital account in a phased way. These measures will not only facilitate foreign trade and investment cooperation with China, but also create better conditions for maintaining the stability of international currencies and financial market and promoting the sound development of economic globalization.
-- Creating a peaceful international environment and favorable external conditions
China will continue to promote friendly relations with the other countries on the basis of the Five Principles of Peaceful Coexistence. We will increase strategic dialogue with the developed countries to promote strategic mutual trust, deepen mutually beneficial cooperation, handle differences properly, explore ways to establish and develop a new type of relationship among the major countries and promote long-term, steady and sound growth of China's relations with these countries. We will continue the policy of developing good-neighborly relations and treating China's neighbors as partners and enhance friendship and cooperation with both the neighboring countries and other Asian countries. We will expand bilateral and regional cooperation and jointly create a regional environment of peace, stability, equality, mutual trust, cooperation and mutual benefit. We will enhance unity with other developing countries, deepen traditional friendship, expand mutually beneficial cooperation, sincerely help the other developing countries achieve independent development by providing aid and making investment and uphold their legitimate rights and interests as well as their common interests. We will actively engage in handling multilateral issues and addressing global issues, undertake our due international obligations and play a constructive role in making the international political and economic order fairer and more equitable. We will continue to carry out exchanges and cooperation with the parliaments, parties, local authorities and NGOs of other countries, expand people-to-people and cultural exchanges to enhance understanding and friendship between the Chinese people and the people of other countries.
China is committed to pursuing a defense policy which is defensive in nature. China has a vast land territory and sea area, with a borderline of over 22,000 kilometers and a coastline of over 18,000 kilometers. China faces multiple traditional and non-traditional security challenges and the threat of separatists and terrorism. It is therefore necessary and justified to modernize China's defense capabilities in order to uphold China's security and protect its peaceful development. The fundamental purpose of modernizing the Chinese armed forces is to safeguard China's sovereignty, security, territorial integrity and interests of national development. China's defense expenditures are appropriate and moderate, and are in keeping with the need to safeguard its security. China will not engage in arms race with any other country, and it does not pose a military threat to any other country. China follows the principle of not attacking others unless it is attacked, and it is committed to solving international disputes and hotspot issues with peaceful means. China actively carries out international military exchanges, promotes international and regional security cooperation and opposes terrorism in all forms.