III. Developing by Relying on Its Own Strength, Reform and
Innovation
China will adhere to the scientific approach for development and have an
overall plan for domestic development and opening to the outside world, and base
its development on its own realities. At the same time, China will maintain the
approach of all-round, wide-area, multi-level openness to the outside world,
striving to attain a more balanced development.
The main problem facing China in its development is the contradiction between
its underdeveloped economy and its people's ever-increasing material and
cultural demands, and the contradiction between economic and social development
and the relatively strong pressure of the population, natural resources and the
environment. Past experience indicates that fundamentally China must rely on
itself to solve the problems in its development. By doing so, the country will
be responsible to the Chinese people as well as to the people of the rest of the
world. It is an important principle that guarantees that China will follow the
road of peaceful development. China will not shift its own problems and
contradictions onto other countries, much less will it plunder other countries
to further its own development.
To achieve development, China will mainly rely on its own strength, reform
and innovation. It has many advantages and favorable conditions: It has the
material and technological foundation supporting further economic development;
it has an ever-growing huge market and a high rate of private savings deposits;
it has a large labor force whose quality, as a whole, is improving all the time;
it has an ever-improving socialist economic market system and related policy
guarantee; and it has a stable social and political environment.
China intends to do the following work well in order to achieve development
by mainly relying on its own strength and through reform and innovation:
- Adhering to innovation in ideas and systems. Practice over the two decades
or so since China introduced the reform and opening-up policies has proved that,
by emancipating the mind, seeking truth from facts and striving for progress,
China is able to bring into full play the enthusiasm, initiative and creativity
of its hundreds of millions of people and open up new prospects for its
modernization drive. China will unswervingly push forward reform in all aspects,
remain steadfast in the direction of socialist market economy in its reform,
intensify reform with emphasis on institutional innovation, and strive to make
breakthroughs in some key areas and important links. Through reform, China will
enhance marketization of its national economy, improve the state's macroeconomic
regulatory system, and constantly establish institutions and mechanisms
conducive to an overall, coordinated and sustainable economic and social
development.
- Opening up the domestic market and increasing domestic demand. It is
China's fundamental stand and long-term strategic guiding principle to expand
domestic demand in its economic and social development. China has entered a
period when the pace of industrialization and urbanization is being quickened,
the people's income level is increasing and their consumption structure is being
upgraded. While changing its mode of foreign trade growth, increasing imports
and strengthening intellectual property protection, and continuing to make
contributions to global trade and the world economy, China keeps up its driving
force to maintain sustained economic development through its huge domestic
demand and domestic market. This has determined that China should and most
likely will mainly rely on domestic demand for its development. China will
ensure that investment in fixed assets will increase at a reasonable scale and
pace so as to bring into better play the role of investment in economic growth.
By implementing correct income distribution and consumption policies, China is
relying more on domestic demand and consumption to promote its economic
development. In recent years, domestic investment and consumption needs are
increasing at a rather rapid rate.
- Promoting the strategic adjustment of the economic structure and the change
of growth mode. China considers changing the growth mode a strategic focal
point, strives to base economic growth on the enhancement of the quality of its
human resources, efficient use of natural resources, reduction of environmental
pollution, and emphasis on the quality and efficiency of its economy. China will
take a new road of industrialization - using the IT industry to promote
industrialization and letting industrialization support the development of the
IT industry. It will quicken the pace of optimizing and upgrading its industrial
structure, develop advanced manufacturing industry, high- and new-tech industry,
especially the IT and biological industries, increase the proportion of the
service sector and improve the level of services, strengthen the construction of
infrastructure facilities of basic industries, and bring into full play the
function of structural readjustment in the change of the growth mode. China will
work hard to develop a cost-saving, recycling and environment-friendly economy,
establishing a national economic system characterized by intensification and
cleanness.
- Promoting scientific and technological progress and strengthening the
ability of independent innovation. China is striving to become a country of
innovation, and it is a state strategy to strengthen the ability of independent
innovation. It has made medium- and long-term scientific and technological
development plans, setting forth the objectives and tasks for scientific and
technological development for the next 15 years. China is making every effort to
enhance its ability of original innovation, integrated innovation and
re-innovation after absorbing advanced technology from abroad. By reforming the
scientific and technological system and increasing financial input through
various channels, China will promote the construction of its national innovation
system and speed up the pace of commercialization of research findings. China
hopes to increase the proportion of funds for scientific and technological
research and development from 1.44 percent of the GDP in 2004 to 2.5 percent in
2020.
- Making every effort to exploit human resources. China will make effort in
implementing the strategy of relying on talented people to make the country
powerful. It will quicken the readjustment of the educational structure and
institute education aimed at all-round development of students, with emphasis
being put on compulsory education, especially compulsory education in the
countryside. It will make greater efforts to develop vocational education and
raise the quality of its higher education, so as to greatly promote the
development of education and foster qualified workers and specialized personnel
in all fields. It is expected that from 2006 to 2010 the secondary vocational
schools will train 25 million graduates, and the higher vocational schools 11
million graduates for the society. The enrolment rate of China's institutions of
higher learning will reach 40 percent by 2020. Meanwhile, China will bring in
talented personnel, especially high-level personnel, from abroad, forming a
favorable mechanism and social atmosphere in which talented people keep emerging
in large numbers and every individual gives full play to his or her talents,
thus providing abundant human resources and intellectual support for the
country's modernization program.
- Working hard to build a resource-saving and environment-friendly society.
Historical experiences show that to have a balanced and orderly development of
the world economy, the international community must handle the energy problem
properly. Through dialogues and cooperation regarding energy, China is working
with other countries to safeguard energy safety and stability. China considers
energy saving one of its basic state policies. Centering on conservation of
energy resources and raising the efficiency of energy consumption, China is
working hard to develop a recycling economy so that it will garner the highest
possible economic and social benefits with the lowest possible energy
consumption. China has persisted in relying on its domestic resources and
constantly increasing the supply of domestic energy. China is not only a big
energy consuming country, but also a big energy producing one. Since the 1990s,
China has obtained 90 percent or more of its energy from domestic sources. The
potential of its domestic energy supply is still great. Verified coal reserves
account for only a small proportion of the potential reserves. Moreover, it is
likely that new oilfields and natural gas fields will be discovered, and the
future of new types of energy and regenerated energy is promising. Meanwhile,
China upholds the basic state policy of environmental protection, and is making
more and more efforts to protect and improve its ecological environment, so as
to create conditions for sustainable economic and social development. In its
environmental protection efforts, China persists in putting precautionary
measures first, treating environmental pollution comprehensively and preventing
pollution at the source. China gives priority to environmental protection, makes
sure that the exploitation of natural resources is in good order, emphasizes
prevention of excessive exploitation of natural resources, and intensifies
protection of natural resources and ecology.
China will unswervingly carry out the basic state policy of opening up to the
outside world, and actively engage in economic and technological exchanges and
cooperation with other countries to raise the overall level of openness. China
has earnestly fulfilled the promises it made when admitted into the World Trade
Organization (WTO) by constantly improving the management system and policies
concerning foreign businesses in China and creating a fair and predictable legal
environment; opening the market further and improving the environment for
investment and trade; improving the trade structure, enhancing the degree of
freedom and convenience for trade and investment, and creating a better
environment for investment; and, in addition, encouraging its own enterprises to
invest overseas and developing alongside foreign businesses. Opening up to the
outside world has played a very important role in promoting China's economic and
social development. The foreign capital China brings in makes up for the
inadequacy of capital for development. Domestic industries have been growing
rapidly thanks to the full utilization of overseas markets. The introduction of
advanced technology, equipment and management expertise has improved the
production technology and management level of Chinese enterprises. Frequent
exchanges with other countries make it possible for China to share the fruits of
mankind's civilization and improve the quality of its own human resources.
