Domestic demand, balanced growth prioritized in China's next five-year plan

China will stick to the strategy of expanding domestic demand, consumption in particular, and seek a new phase of economic growth boosted by consumption, investment and exports, according to an official document released Wednesday.

The document, the Communist Party of China (CPC) Central Committee's Proposal for Formulating the 12th Five-Year Program for China's Economic and Social Development (2011-2015), was adopted at the Fifth Plenum of the 17th CPC Central Committee, which concluded nine days ago.

Macro-economic controls would be boosted, according to the document.

A key task in the 12th Five-Year Plan would be to consolidate and expand achievements in fighting the global economic downturn. China would seek a balance between stable and relatively fast economic growth, restructuring and inflation expectation management.

Consistency and stability of the macro-economic policies would be maintained, while improving their flexibility, scientific properties and foresight to guard against potential risks and avoid drastic economic fluctuations.

Short and long-term macro-economic controls would be combined, while policies were coordinated to ensure stable and relatively fast economic growth.

A long-term mechanism would be built to boost consumption demand.

Consumption would be highlighted in expanding domestic demand to release urban and rural consumption potential and allow China to ascend to the top-ranking markets in the world, said the document.

Urbanization would be promoted in an active and stable way. More efforts would be made to develop the service sector and medium-sized and small enterprises and increase job opportunities.

The income distribution system would be improved, especially for residents with middle and relatively low salaries so as to expand their consumption capacity.

The ratio of government expenditure on living standards and social programs would be raised. Social security coverage would be extended and the public service system improved to build positive public expectations.

More efforts would be made to upgrade market operation system, develop emerging consumption modes, expand new service consumption, upgrade favorable policies for consumption, improve the consumption environment, protect consumers' rights and optimize consumption structure.

The government would guide consumer consumption in a reasonable way, develop environment-friendly consumption products and advocate "civilized, economical, green and low-carbon" consumption modes in tune with Chinese conditions.

The investment structure would be optimized, said the document.

The key role of investment in expanding domestic demand would be given full play. More efforts would be made to maintain reasonable investment growth, optimize investment structures, upgrade investment mechanisms, raise investment quality and efficiency, and effectively push economic growth.

Projects key to expanding China's domestic demand would be given priority at the beginning of the 12th Five-Year period.

Capital would be further channeled into livelihoods, social programs, agricultural and rural construction, scientific innovation, biological and environmental protection, and resources saving, aided by industry policies.

More capital would be channelled into central and western regions.

The requirements for investment projects to meet in land use, energy efficiency, environment protection would be enforced strictly to check blind expansion or repetitive construction.

Positive interaction between investment and consumption would be boosted. The expansion of investment, job creation and higher living standards would together create demand.

Fields available to government investment would be defined clearly and management of local government financial vehicles tightened to guard against investment risks.

Investment activities by state-owned enterprises would be standardized with preferences on economic and social benefits.

More non-state investment would be encouraged in infrastructure sectors, infrastructure equipment, urban public services, social programs and financial services.