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China targets 8% growth for 2005
(Xinhua)
Updated: 2005-03-05 10:31

China will gear down its high-octane economy to a level lower than the stunning 9.5 percent registered in 2004, as Premier Wen Jiabao announced Saturday that the government targets on an 8-percent GDP (gross domestic product) growth rate this year.

"Neither a big up nor down in the economy is conducive to economic growth, reform and opening-up drive and social stability," Wen stressed in his government work report delivered at the opening meeting of the annual session of the National People's Congress (NPC), China's top legislature.

The premier reiterated governments at all levels should engineer the economic growth and social progress with a scientific outlook on development, shifting the government's development philosophy from growth-centered to people-centered.

"The interests of the broad masses should be placed in the first place," Wen Jiabao noted through nationwide TV live broadcasting.

Twenty-six out of China's 31 provinces, municipalities and autonomous regions have so far posted the abolishment of agro-tax,a policy Wen set forth at last NPC session that benefits farmers at the cost of the central government's fiscal revenues.

Wen announced Saturday in his report that agro-tax will be exempted across the country by 2006, two years earlier than the original timetable.

Farmers' earnings now lag behind city residents not only in amount, but in growth rate -- being 7.7 percent for city dwellers and 6.8 percent for rural people last year.

For urban residents, Wen vowed to create 9 million new jobs this year after the country saw its registered urban unemployment rate fall by an annualized one tenth of a percentage point to 4.2 percent by the end of last year, a minor but first decrease in nearly a decade.

The central government will step up support to building of a nationwide disease control and medical treatment system to cope with emergency events like the SARS outbreak that killed hundreds in the spring-summer of 2003.

Wen said in 2005 the government will typically set aside 3 billion yuan (362.3 million US dollars) to aid the technical upgrading work at state-owned coal mines. The premier called for local governments and enterprises to shovel more money into the field.

A vice provincial governor was suspended following a gas explosion at the Sunjiawan colliery near Fuxin, in northeast China's Liaoning Province, that claimed 214 lives last month -- the country's worst mining accident in decades.

"PRUDENT" FISCAL, MONETARY POLICIES

China's fiscal policy will swing from "proactive" to "prudent",resulting in a 19.8 billion yuan (2.4 billion dollars) reduction in fiscal deficit in 2005, dropping to 300 billion yuan (36.2 billion dollars), Wen announced in his report.

Long-term treasury bonds to be issued this year will be 30 billion yuan (3.6 billion dollars) less than last year, continuinga dropping streak to stand at just 80 billion yuan (9.7 billion dollars).

China began issuing such bonds in 1998 in a bid to expand investment to stimulate the then slowing economic growth. But Wen said the existing investment scale was already big and private funds had started to flourish in recent years.

The monetary policy would remain "prudent", the premier said.

The word "prudent" is interpreted by many economists as being more adaptable to economic environment -- neither solely expansivenor contractive. Earlier central bank sources said new loans from banks in China should not exceed a combined 2.5 trillion yuan (301.9 billion dollars) this year.

Wen said China aims to maintain basic balance in international payments this year.

The country's trade surpluses have become an excuse for some developed countries to demand the appreciation of yuan.



 
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