The Central Economic Work Conference Held in Beijing

Photo from Xinhua

In his important speech,  General Secretary of the CPC Central Committee, President of China and Chairman of the Central Military Commission, Xi Jinping analyzed domestic and external economic environments, summarized the economic work in 2013 and put forward the general requirements and major tasks for economic work in 2014. Chinese Premier Li Keqiang elaborated next year’s direction of our macroeconomic policies, made specific arrangements for economic work in the coming year and gave a closing speech.

The conference noted that, since the beginning of this year, under an extremely complex situation, we have carried out the guiding principles of the Party’s 18th National Congress, adhered to the guidance of Deng Xiaoping Theory, the important thought of “Three Represents” and the Scientific Outlook on Development, and strengthened the Party’s leadership over economic work. We have rallied public support by focusing on finishing building a moderately prosperous society in all respects and achieving the Dream of China for a great rejuvenation of the Chinese nation. We have clung tightly to the main theme of developing in a scientific way and the main thread of accelerating the transformation of economic development pattern. We have focused on improving the quality and performance of economic growth. We have taken both domestic and international situations into account, adhered to the keynote of making progress while ensuring stability, grasped the general trend of economic development, stayed focused on economic control and adhered to the bottom-line thinking. In accordance with the idea of stabilizing macro policies, making micro policies flexible and supporting economic policies with social ones, we have solidly done our work, achieved progress and an upward momentum in our social and economic development while maintaining stability and made a good start. Our economy in general is steadily moving forward. Another plenteous harvest of food production has been achieved, new progress has been made in structural adjustment, reform and opening-up have been intensified and people’s living standards have been improved continuously. China is thus enjoying general social harmony and stability. It is particularly important that, the Third Plenary Session of the 18th CPC Central Committee has determined the program of action for accelerating the change of the growth model, fostering new drives for economic development and achieving sustained and healthy economic growth.

The conference indicated that, we should owe these achievements to the sound decisions made by the CPC Central Committee and its correct leadership, as well as the hard work and concerted efforts of the Party and the people of all ethnic groups in China. We must cherish these hard-won achievements.

The conference emphasized that, while affirming the progress and an upward momentum achieved in our social and economic development, we should be fully aware of the existing problems. There is downward pressure on economic growth. Overcapacity remains serious in some industries. It is getting harder to ensure food security. The macro debt level continues to rise. The structural employment issue remains serious. Such prominent problems as deterioration of the ecological environment, the worrying quality of food and drugs and inadequate public order remain unalleviated.

The conference believed that, although the world economy will continue its slow recovery next year, it will still face a lot of uncertain and unstable challenges. New source of growth impetus remains unclear. Major countries’ monetary policies, the trade and investment patterns, as well as the changes in the direction of commodity prices are all uncertain. By taking full account of the uncertainty and complexity of next year’s world economy, we should strive to seize opportunities and calmly deal with various risks and challenges.

The conference noted that, the current and future world economy must be observed in combination with the backdrop of the global financial crisis. As the global financial crisis has long-term impacts and competition is intensifying in the international markets, we must go with the tide and change our thinking. We need to calmly do our work well, energetically promote reform and innovation, and release the strong driving force for development and the huge potential of domestic demand. By taking the initiatives in changing the growth model, adjusting the economic structure and reforming and opening up, we should gain initiatives in economic development and in international competition. We should step up efforts in creating and maintaining a sound environment for friendly political relations, favorable economic and trading rules as well as a broad development space.

The conference stressed that, the year 2014 is the first year for comprehensively implementing the spirit of the Third Plenary Session of the 18th CPC Central Committee and fully deepening reforms, we are thus facing important and arduous reform tasks. We will enter the fourth year of the Twelfth Five-Year Plan period in 2014, which is crucial to the full completion of the five-year plan. The general requirements for next year’s economic work are as follows: to fully implement the gist of the 18th National Congress as well as the Second and the Third Plenary Sessions of the 18th CPC Central Committee, adhere to the keynote of seeking progress in a stable manner, incorporate reform and innovation into all fields and all aspects of economic and social development, maintain the continuity and stability of our macroeconomic policies, focus on unleashing the vitality of the market, accelerate the transformation of growth model and the adjustment of industrial structure, strengthen the establishment of the basic public service system, make vigorous efforts in improving people’s well being, effectively improve the quality and performance of economic growth, and boost sustained and healthy economic development as well as social harmony and stability.

The conference noted that, to do a good job in next year’s economic work, the core is to seek steady progress and promote reforms and innovations. By taking a step-by-step and prudent approach, we should consolidate the upward momentum in our development while maintaining stability, promote the overall stability of economic and social development, and create conditions for comprehensively deepening reforms. Meanwhile, we should actively propel the deepening of reforms in an all-round way, stick to a problem-oriented approach, have the courage to make breakthroughs and innovations, and promote our development, change of growth model and adjustment of industrial structure, and the improvement of people’s well being through reforms. Steady development and reform are dialectically united and mutually conditional. To seek steady growth, we need to stay focused; to seek reform, we need to maintain the order. The key is to master the boundaries between them.

The conference stressed that, in order to well manage next year’s economic work, we should develop a comprehensive understanding of the relationship between sustained and healthy economic development and GDP growth. Economic development should not be simplified to GDP growth. We should seize opportunities to maintain a proper GDP growth and promote economic restructuring, with a view to striving to achieve a pace of development, at which both the quality and performance of economic growth will be improved while the unwanted side-effects will be avoided.

The conference pointed out that, in order to well manage next year’s economic work, we must maintain our proactive fiscal policies and prudent monetary policies. We should further adjust the fiscal expenditure structure, practice strict economy, improve the capital efficiency, perfect structural tax reduction policies and expand the pilot reform of replacing turnover tax with value-added tax to more sectors. We should keep a reasonable growth of the monetary credit and social financing scale, improve and optimize the financing and credit structures, increase the proportion of direct financing, push forward the reforms of interest rate marketization and RMB exchange rate formation mechanism, enhance the efficiency of financial operations and improve the ability to serve the real economy. The implementation of either the proactive fiscal policies or the prudent monetary policies or other policies should be combined with the deepening of reforms, so that we can improve our macro-control with the spirit, ideas and approaches of reform and incorporate reforms into the macro-control. We should make efforts to free up effective demand, give full play to the fundamental role of consumption, the pivotal role of investment and the supporting role of exports, and maneuver well the troika of consumption, investment and external demand that drive China’s economic growth.

The conference pointed out the main tasks of next year’s economic work.

Firstly, we will effectively safeguard national food security. We must implement a national food security strategy, which is self-directed, focuses on domestic supply, ensures production capacity, allows moderate food imports and relies on science and technology. We should depend on our own ability to guarantee grain ration supply and integrate domestic resources to protect our priorities, so as to achieve the basic self-reliance in grain supply and the absolute safety of grain ration supply. We should focus on both quality and quantity of agricultural products, pay more attention to the quality of agricultural products and food safety, and emphasize on production source treatment and whole sales process supervision. We should pay attention to sustainable development of agriculture, change the growth model, and develop water-saving and circular agriculture. We should do a good job in building the capability to safeguard food security, strengthen agricultural infrastructure and speed up the development of agricultural science and technology.

Secondly, we will vigorously adjust industrial structure. We should step up efforts in resolving the problem of overcapacity and implementing the strategy of innovation-driven development. The central government’s decisions and arrangements on tackling overcapacity should be unswervingly implemented without compromise. We should integrate the goals of letting the market play a decisive role in allocating resources and letting the government play a better role, and adhere to the system of survival of the fittest through market competition. The government should strengthen the binding targets for environmental, safety and other types of standards, reinforce law enforcement, and severely punish the misconducts causing eco-environmental damages. The fundamental way to address the problem of overcapacity is innovation, including technological innovation, product innovation, organizational innovation, business model innovation and market innovation. We should make more efforts to develop strategic emerging industries and accelerate the optimization and upgrading of traditional sectors. We should create an environment for enterprises to spearhead innovation. The government should strengthen intellectual property rights protection and improve tax policies for enterprises to promote innovation. We should enhance incentives and make good use of talents, so that the inventors and innovators will be able to reasonably share the benefits of the corresponding innovations. Further, we should remove bottlenecks that hinder the transformation of technological achievements.

Thirdly, we will make efforts to prevent debt risk. We should treat the control and elimination of local government debt risk as a critical task of our economic work. We should both take short-term measures and build permanent systems to do a good job in precluding local government debt risk. The source regulations should be strengthened. Local government debt should be placed by categories under the system of incorporating all government receipts and expenditures into budgetary management. The process by which governments raise debt should be strictly managed. Responsibilities should be clarified and the government of each province, autonomous region and municipality should be held accountable for government debt within their jurisdictions. Education and evaluation should be strengthened to put right any incorrect official performance orientation.

Fourthly, we will actively push forward the coordinated development of all regions. We should continue to fully implement the overall strategy for regional development, as well as improve and innovate regional policies. We should narrow the scope of the policies and pay attention to cross-regional and sub-regional planning to improve the accuracy of regional policies. We should formulate policies according to the prevailing rules of market economy. We should unswervingly implement the major function zoning system, so that the development of regions with various natural conditions can be promoted in accordance with their respective functional positioning. Completing the building of a moderately prosperous society in all respects should be based on the development of all regions. We should solidly win the arduous battle of poverty alleviation in order to continuously improve living conditions in poverty-stricken areas. The improvement of people’s living standards in poverty-stricken regions should be taken as a major indicator of the local governments’ performance assessment. To achieve poverty alleviation, we must plan scientifically, suit measures to local conditions and seize the key tasks with the aim of improving the accuracy, effectiveness and sustainability of our work.

Fifthly, we will concentrate efforts to ensure and improve people’s wellbeing. We shall continue to follow the work idea of “holding the bottom line, highlighting the priorities, improving the systems and guiding the public opinions” to coordinate such work as education, employment, income distribution, social security, medical and health care, housing, food safety and work safety, with a view to effectively doing a good job in various tasks of improving people’s wellbeing. We should give a higher priority to the work on employment, focusing on the employment of university graduates and the re-employment of layoffs arising from tackling overcapacity. We should manage to solve the housing problem and explore the housing patterns which are compatible with the conditions of our country and the characteristics of our development stage. We should increase the construction and supply of low-rent housing, public rental housing and other types of government-subsidized housing and do a good job in upgrading the housing units in run-down areas. Megacities should place emphasis on structural adjustment of land supply to improve the proportion of residential land and land plot ratio. We should intensify efforts on environmental treatment and ecological protection, investment and policy-making, strengthen regional joint prevention and control, enhance pollution source treatment, and effectively implement the measures to prevent and control air pollution.

Sixthly, we will constantly improve opening-up. We should maintain our traditional export strengths and give play to the role of technology and large complete equipment exports in promoting the exports of related industries. We should create new comparative and competitive advantages, and increase the imports of equipment and technologies required during the process of changing growth model and adjusting industrial structure. We should pay attention to the system building and guarantee of rules, speed up FTA talks, and steadily push forward the negotiations on investment agreements. A stable, transparent and equitable investment environment should be created to effectively protect investors’ legitimate rights and interests. We should strengthen macro-level guidance and services for “going abroad”, offer accurate information on overseas investment, and simplify the approval procedures for overseas investment. We should promote the building of the economic belt along the Silk Road, lose no time in formulating a strategic plan and strengthen the infrastructure and connectivity. We should build the maritime Silk Road for the 21st century to reinforce the building of maritime connectivity and tighten ties of mutual interests.

The conference noted that to manage well next year’s economic work, we need to seek steady progress. The stabilization of economic growth momentum, structural adjustment and promotion of reforms should be coordinated to keep China’s economic growth rate within a reasonable range. Giving priority to people’s well-being should be highlighted to facilitate social justice. Price stability should be maintained to create a sound environment for promoting reforms and adjusting economic structure. The change of growth model should be accelerated to facilitate quality and efficiency improvement as well as economic upgrading, and to promote sustained and healthy economic growth. We should pay great attention to the golden mean between the economic and social development goals and the macro policies, and constantly improve the ways and means of regulation and control. We should deepen the reform of the economic system with a firm focus on letting the market play a decisive role in allocating resources and intensify efforts to make substantive progress in major areas and key aspects. We should establish a long-term mechanism to expand domestic demand and focus on increasing consumer demand. We should accelerate the development of modern agriculture and promote the steady development of agriculture and continuous increase of farmers’ income. We should thoroughly implement the innovation-driven development strategy and push forward industrial restructuring and upgrading. We should promote faster development of the service sector, increase its share in the economy, and facilitate its upgrading. We should speed up the building of an ecological civilization and promote sustainable development. We should actively and firmly push forward urbanization, focusing on the improvement of its quality. We should strengthen system building and weave a safety net to protect people’s livelihood.

The conference emphasized that we must strengthen our Party’s leadership in comprehensive deepening reforms. The decision made by the Third Plenary Session of the 18th CPC Central Committee is our Party’s overall deployment and mobilization for fully deepening reforms in the new era. We have a tight schedule to complete the reform tasks identified by the decision. Therefore, we should strengthen study to assimilate the spirit of the plenum, comprehensively and accurately apprehend the new ideas, perceptions and measures put forward by the plenum, and call on the whole Party and the whole society to unify their thinking and actions into the spirit of the plenum and the requirements of the Central Committee. We should grasp the general situation, make solid progress and be both bold and prudent. While making progress step-by-step tactically, we should forge boldly ahead strategically. We should properly promote reforms as they are the self-improvement and development of China’s socialist system. To accurately promote reforms, we should follow the requirement proposed by the Central Committee. We should promote reforms in a good order and refrain from rushing headlong into action while the timing is premature and the conditions remain unfulfilled. We should promote reforms in a coordinated way, pay attention to the correlation and coherence of reforms, and strive to maximize the comprehensive benefits. We should focus on the actual effects to earn people’s trust. We must honor our words and matches our words with results-oriented actions. We should make big wins happen through the accumulation of many small victories, so that the public can get tangible benefits and the whole community can feel that our market environment, business conditions and work styles are improving day by day. We should push forward reforms by situations and categories. Next year or in the near future, we can speed up those that have clear directions and quick results, and are subject to the approval of local governments and departments. With respect to reforms that are wide-ranging and need to be approved through the central government’s decision-making, we should lose no time in carrying out research to develop reform plans and formulate specific reform strategies. These reforms can be promoted at their appropriate times next year on the basis of the overall co-ordination and approval. With respect to reforms that have not been thoroughly understood, but have to be promoted, we should boldly explore new approaches, carry our pilot projects first, find out the rules and build consensus, with a view to accumulating experiences and creating necessary conditions for them to be comprehensively implemented. The plenum has requested some systems to be developed and some laws to be revised and improved. We should strengthen research and start to work on them as soon as possible. The CPC Central Committee has made the decision to set up a central leading team for comprehensively deepening reforms, which will work under the leadership of the Political Bureau of the CPC Central Committee and the Standing Committee of the Political Bureau. Each region and each department has been required to appoint one organization to be in charge of reforms. The leading officials of these organizations should directly supervise the work related to reforms.

The conference required the whole Party and the people of all ethnic groups in China to rally closely around the CPC Central Committee led by General Secretary Xi Jinping, unite together and work solidly, and earnestly implement all arrangements made by this conference, with a view to striving to facilitate the sustained and sound economic and social development.

Members of the Political Bureau of the CPC Central Committee, Secretary of the Secretariat of the CPC Central Committee, State Councilors, President of the Supreme People’s Court, Procurator-General of Supreme People’s Procuratorate attended the conference.

Leading Party and government officials of all provinces, autonomous regions, municipalities directly under the Central Government, municipalities separately listed in the state plan, and Xinjiang Production and Construction Corps, leading officials from relevant departments under the CPC Central Committee, relevant ministries and commissions of the State Council and relevant organizations , leading officials from some companies and financial institutions managed by the Central Government, and leading officials from the PLA and armed forces also attended the conference.

(This English version is for your reference only.In case any discrepancy exists between the Chinese and English context, the Chinese version shall prevail.)