The following is the full text of the Report on the Work of the
Government delivered by Premier Wen Jiabao at the Fourth Session of the Tenth
National People's Congress on March 5, 2006.
Report of the Work of the
(Delivered at the Fourth Session of the Tenth National People's Congress
on March 5, 2006)
Premier of the State Council
On behalf of the State Council, I would like to present to you the following
report on the work of the government for your deliberation and approval. I also
welcome comments and suggestions on my report from the members of the National
Committee of the Chinese People's Political Consultative Conference.
I Review of the Work of the Past Year
Major achievements were made in 2005 in the socialist modernization drive.
-- Economic growth was fast yet steady. China's GDP reached 18.23 trillion
yuan in 2005, an increase of 9.9 percent over the previous year. Government
revenue exceeded 3 trillion yuan, 523.2 billion more than the previous year. The
consumer price index rose by 1.8 percent. China's economy was in good shape and
characterized by fast growth, improved economic returns and stable prices.
-- Major steps were taken in reform and opening up. Breakthroughs were
achieved in some key areas. China's import and export volume totaled 1.42
trillion U.S. dollars, an increase of 23.2 percent. Total foreign direct
investment actually used reached 60.3 billion dollars, and the country's foreign
exchange reserves totaled 818.9 billion dollars at the end of 2005.
-- Continued progress was made in social programs. Science and technology,
education, culture, health, sports and other undertakings developed in an
all-round way. The success of the Shenzhou VI manned space flight shows that
China has reached world-class levels in some key areas of science and
-- People's lives continued to improve. A total of 9.7 million urban
residents entered the workforce for the first time last year. Urban per capita
disposable income rose to 10,493 yuan, an increase of 9.6 percent after
adjusting for inflation, and rural per capita net income grew to 3,255 yuan, an
increase of 6.2 percent after adjusting for inflation.
China took another substantial step forward on the road of building a
moderately prosperous society in all respects.
We adopted a scientific outlook on development to guide China's overall
economic and social development last year. We mainly undertook the following
1. Solving the major problems affecting economic performance. We
continued to exercise effective macroeconomic regulation in accordance with the
principle of taking different approaches to different situations and encouraging
the growth of some sectors while discouraging the expansion of others. We used a
combination of fiscal, tax, monetary and land policies to curb overheated growth
in fixed asset and real estate investment and ballooning housing prices. In
addition, we increased investment in weak links such as agriculture, energy,
transport, and social programs to promote balanced development and provide
momentum for future development. We improved economic regulation and reduced the
pressure on tight supplies of coal, electricity, and petroleum and on the
overloaded transportation system, thus ensuring fast yet steady growth of
2. Promoting economic restructuring and change of the pattern of economic
growth. Work related to agriculture, rural areas and farmers was further
intensified. The agricultural tax was rescinded in 28 provinces, autonomous
regions and municipalities directly under the central government, and the
livestock tax was rescinded nationwide. We increased subsidies to grain
producers and transfer payments to major grain-producing counties and
financially strapped counties, set floor prices for the purchase of key grain
varieties in some major grain-producing areas, and increased rural incomes
through a variety of channels. Last year, 297.5 billion yuan from the central
government budget was spent on agriculture, rural areas and farmers, a
year-on-year increase of 34.9 billion yuan. Having risen considerably the
previous year, total grain output rose again by 14.54 million tons to 484.01
million tons. The increased overall agricultural capacity, stable increase in
grain production and steady increase in rural incomes provide the foundation for
ensuring fast yet steady economic development and social stability.
In industrial restructuring, we formulated and implemented development
programs and industrial policies for energy, important raw material production,
equipment manufacturing and other sectors, and adopted policy measures to
encourage development of the wholesale and retail industry. We guided and
supported major industries to ensure their sound development and closed down a
number of production facilities that had backward equipment, wasted energy,
created serious pollution and were unsafe.
We paid particular attention to energy and resource conservation and
environmental protection and laid out tasks, policies and measures for building
a resource-conserving society and developing a circular economy in order to
change the pattern of economic growth. We launched 178 major projects that save
energy and water and comprehensively utilize resources. Management of mineral
exploration and exploitation, land use, and urban and rural planning was
enhanced. Last year, 15.2 billion yuan from the sale of treasury bonds was used
to finance key ecological projects undertaken to prevent and control pollution
in the basins of the Huai River, Tai Lake and other major rivers and lakes,
protect virgin forests, return farmland to forests or grassland, and prevent and
control desertification. We launched special projects to address serious
environmental problems that were endangering people's health.
3. Deepening economic restructuring and opening China further to the outside
world. Trials of comprehensive rural reform were carried forward. Significant
progress was made in introducing a shareholding system in state-owned commercial
banks and in reforming rural credit cooperatives. Reform of the shareholder
structure of listed companies made steady progress. Reform of the mechanism for
setting the Renminbi exchange rate was implemented smoothly. Introduction of a
modern corporate structure in state-owned enterprises was accelerated. A total
of 21.9 billion yuan was allocated by the central government to subsidize the
policy-based closure and bankruptcy of 116 state-owned enterprises. The work of
relieving enterprises of their obligation to operate social programs continued.
Reform in the areas of public finance, tax, investment and pricing was deepened.
Reform of the postal service system was initiated. Further progress was made in
the reform of the railway and civil aviation systems. Policy measures were
adopted to encourage, support and guide the growth of the non-public sector of
the economy. Breakthroughs were made in reforms in some major areas.
We actively addressed new issues arising in the course of opening China to
the outside world. The structure of foreign trade was improved by adjusting
policies concerning export rebates, tariffs and processing trade. The export
rebate mechanism was improved. Steady progress was made in opening the service
sector to foreign competition. Overall arrangements were made for work after the
transition period following China's entry into the WTO.