PROPERTY IS PARAMOUNT: The Central Economic Work Conference underlined the importance of building affordable homes for citizens and maintaining the stable development of real estate industry

Facing stiff headwinds in the year ahead, China's Central Economic Work Conference, held annually in winter, vowed to boost the country's economic growth by encouraging more spending by its own consumers.

All the Central Government's top decision makers attended the three-day conference on December 8-10 in Beijing, during which they reviewed the effectiveness of this year's economic work and set the tone for next year's economic development.

President Hu Jintao said in his keynote speech that this year was particularly significant for China, because the country experienced many unexpected and daunting challenges, including severe winter weather at the beginning of the year, the May 12 earthquake and the current international financial crisis. He affirmed the country's achievements in easing inflation and improving its economic structures thanks to a series of timely macro-control measures.

Now that inflation is no longer an issue of concern, Premier Wen Jiabao underlined the prime importance of maintaining stable and relatively fast economic growth by relying on domestic consumption.

"Maintaining growth" and "expanding domestic consumption" have become two key phrases in defining next year's economic development priorities. The focus of last year's conference was "preventing the economy from overheating and preventing headline inflation."

Wen also outlined other major economic tasks for next year, including optimizing sustainable development via structural adjustment, strengthening reform to inject vigor and vitality into social and economic development, enhancing social program construction, resolving hard issues confronting citizens and maintaining sound and fast social and economic development.

Mei Xinyu, a researcher at the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, highlighted the significance of expanding public spending, but warned that certain parties should not manipulate it as a tool for gaining windfall profits. He also applauded proposed tax cuts, adding that they not only would ease the tax burden on companies so that they could invest more, but also would increase consumption.

A decade after the 1997-98 Asian financial crisis, the top economic planners again applied an "active" (instead of prudent) fiscal policy at a time of international economic downturn to propel domestic growth. The Central Government has already come up with an economic stimulus package of 4 trillion yuan ($586 billion) to invest in infrastructure and social programs, which are expected to contribute 1 percent to GDP growth in 2009.

As the international financial turmoil worsens and penetrates the real economy worldwide, the Chinese economy is increasingly challenged by global instabilities and uncertainties as international demand for its products continues to weaken.

Exports account for about 40 percent of GDP in the country. They were once the most robust sector propping up economic growth, but now they have fallen sharply. The November trade figures from the National Bureau of Statistics show that exports fell 2.2 percent year on year, while October exports grew 19.2 percent year on year.