5. Promoting transformation and upgrading of the industrial structure through innovation

We will rely on innovation, develop new products, models, forms of business, and industries, raise the core competitiveness of our industries, and advance the push toward mid- and high-end industries.

1) We will fully implement the strategy of innovation-driven development.

We project spending on R&D as a percentage of GDP will come to 2.2% in 2015. We will optimize and integrate science and technology programs (special projects and funds) financed by the central government. We will launch regional trial reforms to promote all-around innovation. We will improve policies on equity-based incentives for making innovation, and accelerate the reform for managing the use and commoditization of and the distribution of profit from scientific and technological advances of public institutions. We will establish more national innovation demonstration zones, and fully implement preferential policies such as extra deductions for R&D expenses. We will scale up state seed funds for encouraging the application of scientific and technological advances. We will move faster in carrying out key national scientific and technological programs and plan a number of major science and technology projects, major programs, and national innovation platforms.

2) We will boost the scale and strength of strategic emerging industries.

We will vigorously develop the information economy, and promote full integration of the information industry with traditional industries. We will formulate an "Internet Plus" action plan, support the integrated development of cloud computing with the Internet of Things and the mobile Internet, and foster the artificial intelligence industry. We will implement major innovation projects in biomedicines, civil space infrastructure, big data, high-end equipment, next-generation information networks, new energy, new materials, new-energy vehicles, aircraft engines, and gas turbines. We will advance the development of national defense-related science, technology, and industries by integrating the military and civilian sectors. We will set up state seed funds for investment in emerging industries.

3) We will accelerate the transformation and upgrading of traditional industries.

We will implement the "Made in China 2025" strategy. We will introduce a three-year action plan for enhancing the core competitiveness of our manufacturing industries. We will focus on making breakthroughs in core technologies in key areas, such as industrial robots, rail transit equipment, high-end vessels and ocean engineering equipment, new-energy vehicles, modern agricultural machinery, and high-end medical appliances and medicines, and promote the industrial application of these technologies. We will coordinate the implementation of major projects on nuclear power, hydropower, and large coal and coal-power bases. We will accelerate the adjustment and optimization of industries with overcapacity, work harder to phase out outdated production capacity, and encourage enterprise mergers and reorganizations. We will encourage businesses to engage in technological upgrading. We will continue working to turn the coal industry around.

4) We will make the service sector better able to support economic growth.

We will fully implement pricing, fiscal, tax, and land policies to aid the development of the service sector, ensure that paid vacations are enforced, deepen the comprehensive trial reforms in this sector, introduce a statistical categorization of producer services, and formulate policies and guidelines for the development of consumer services. We will energetically develop producer services such as industrial design and finance lease, vigorously foster and develop high-tech services such as R&D, systems integration, intellectual property rights, and inspection and testing, and promote the integrated development of services with manufacturing industries. We will improve mobile payment infrastructure and trusted transaction services, and advance the development of e-commerce, logistics, and express delivery services. We will move faster in building a backbone network for the circulation of agricultural products nationwide. We will implement the mid-to-long-term plan and the three-year action plan for the development of the logistics industry, designate pilot cities for innovatively developing modern logistics, build national demonstration logistics parks, and support building a shared logistics information platform.

5) We will enhance the effective supply capacity of infrastructure and basic industries.

We will move faster to build railways, especially in the central and western regions, and promote the systematic development of intercity rail lines and urban rail transit. We will work to ensure that there are no national expressways left hanging unfinished, and rebuild bottlenecked sections of ordinary national and provincial trunk highways so that they are capable of accommodating more traffic. We will improve the development of high-grade inland waterways. We will advance the construction of civil aviation infrastructure such as the new airport in Beijing. We will accelerate the development of facilities for coal transportation and electricity transmission and pipelines for oil and gas transmission, actively develop hydropower, safely develop nuclear power, vigorously develop wind power, solar energy, and biomass energy, improve the development and utilization of natural gas, and increase the proportion of clean energy and renewable energy resources in total energy consumption.

6. Improving the pattern of economic development between different regions

We will give full play to the comparative strengths of different regions, foster and expand new growth poles and new economic support zones, and comprehensively promote coordinated and balanced development between different regions.

1) We will effectively carry out the three key strategies: the strategy of developing the Silk Road Economic Belt and the 21st Century Maritime Silk Road, the strategy of promoting coordinated development of the Beijing-Tianjin-Hebei region, and the strategy to build an economic development belt along the Yangtze River.

We will ensure the completion of tasks and projects prioritized in 2015 in implementing the strategy of developing the Silk Road Economic Belt and the 21st Century Maritime Silk Road. We will roll out guidelines for the coordinated development of the Beijing-Tianjin-Hebei region, and provide support for the region to make substantial breakthroughs first in integrated transportation, environmental protection, and industrial upgrading and relocating. In addition, we will intensify institutional reform, strengthen innovation-driven development, carry out trials and demonstrations in districts and fields meeting certain conditions, and relocate functions non-essential to Beijing's role as the capital away from the city in a proactive yet prudent way. We will formulate the guidelines on building the economic development belt along the Yangtze River; accelerate the development of an integrated multidimensional transportation corridor and a green, ecological corridor all along the belt; start construction of major projects in an orderly fashion, including upgrading the major waterways and building docks and quays along the Yangtze River; establish demonstration zones for accepting relocated industries; and set up jointly-built industrial parks.

2) We will fully carry out the master strategy for regional development and the strategy for functional zoning.

We will refine and firm up the policies and measures concerning large-scale development of the western region which are appropriate under the new conditions, and further open up border areas and inland areas to the outside world. We will roll out the guidelines on all-around revitalization of northeast China and other old industrial bases, and fully implement major near-term policies and measures for revitalizing northeast China. We will formulate a new ten-year plan on boosting the rise of the central region, and build comprehensive transport networks and hubs in the region at a faster pace. We will support the eastern region in leading the way in institutional innovation aimed at economic transformation and upgrading. We will promote orderly development of new districts in urbanization. We will continue to carry out national trials and demonstrations for developing function zones, improve the policy framework for integrated, complete reforms, and establish sound mechanisms for monitoring and giving early warnings on the carrying capacity of resources and the environment. We will also energetically develop the marine economy.

3) We will continue to support the development of regions with unique features at a faster pace.

We will support the economic and social development of Xinjiang, Tibet, and the Tibetan ethnic areas in Sichuan, Yunnan, Gansu, and Qinghai provinces, and provide effective one-to-one assistance to designated areas. We will accelerate the upgrading of cities once dependent on resources that are now depleted, and push forward with the relocating and rebuilding of old industrial areas within cities and independent industrial and mining areas. We will formulate guidelines and planning for supporting the development of old revolutionary base areas. We will continue to promote development in contiguous poor areas as a whole in order to help alleviate poverty.

4) We will actively advance the new type of urbanization.

We will carry out the plan on urbanization with the focus on three tasks, each concerning 100 million people: granting urban residency to around 100 million people who have moved to cities from rural areas, rebuilding run-down areas and "villages" inside cities where around 100 million people live, and guiding the process of urbanization for around 100 million rural residents in the central and western regions. We will coordinate efforts in carrying out comprehensive pilot projects for advancing the new type of urbanization nationwide and in launching trials for comprehensive reform in small and medium-sized cities, and we will explore the establishment of mechanisms for sharing the costs associated with helping people from rural areas who have moved to cities become urban citizens, of well-regulated, diversified, and sustainable mechanisms for investment and financing to ensure funding for urban development, and of new models of administrative management that encourage innovations and reduce costs. We will improve the overall distribution of areas that are undergoing urbanization, formulate planning for cross-provincial city clusters, and promote the coordinated development of city clusters in key regions. We will move faster to construct multi-purpose networks for underground pipelines and facilities for flood prevention and rainwater control in cities. We will ensure the effective governance of urban maladies such as pollution and traffic congestion. We will carry out pilot projects in more cities and counties to replace multiple plans for local development with one master plan. By the end of 2015, 55.77% of China's population is expected to be comprised of permanent urban residents, and 37.9% is expected to be comprised of registered urban residents.

7. Making unremitting efforts in energy conservation, emissions reduction, low-carbon development, and ecological and environmental protection

In addressing problems concerning the environment, we will continue to treat root causes, conduct monitoring and regulation over the whole process of production, and enforce severe punishments for violations or damage to the environment. We will attach greater importance to green, circular, and low-carbon development so as to improve the ecosystem and environment of China and build a beautify country.

1) We will improve the systems for promoting ecological progress.

We will issue and implement guidelines on accelerating ecological advancement, and on the basis of research, formulate a plan for implementing the structural reform for promoting ecological progress and a system for setting targets for ecological improvement. We will establish demonstration zones for enforcing compensation for ecological damage and for promoting ecological progress. Compensation for ecological damage will be levied on a trial basis at key water sources, in major drainage basins, and across drainage basins. We will launch pilot projects to promote a cap-and-trade system for emissions. We will strengthen the protection of mudflats and improve the management of their development. We will carry out trials of allowing enterprises to commission a third party to treat their pollution, and provide special financing for encouraging energy efficiency and provide green loans for environmentally responsible businesses. We will explore the introduction of compulsory environmental pollution liability insurance.

2) We will strictly control both energy intensity and total energy consumption.

We will continue to implement the early-warning and regulatory system for energy conservation and emissions reduction, tighten control over energy intensity, improve management of total energy consumption, and strictly evaluate the performance of energy conservation targets and correspondingly pursue accountability. For areas affected by severe smog, regions where conserving energy is difficult, and industries with overcapacity, we will strictly control the number of energy-intensive projects and put into effect policies for coal use reduction and for replacing some coal use with alternative energy sources. We will continue to launch key energy-conservation projects and pilot and demonstration projects that aim to establish a circular economy, and vigorously promote the recovery of resources from industrial and household waste.

3) We will strengthen pollution control and ecological protection.

We will fully implement the ten measures on controlling air pollution as stipulated in the Air Pollution Prevention and Control Action Plan, implement the action plan for preventing and controlling water and soil pollution, and strengthen efforts to prevent and control air pollution in key areas and water pollution in key drainage basins and sea areas. We will upgrade coal-burning power plants to achieve ultra-low emissions. We will promote clean and efficient use of coal. We will accelerate efforts to increase the quality of refined oil products. We will remove more high-emission vehicles from roads. We will redouble efforts to control the factors causing sandstorms, treat soil erosion, prevent the spread of stony deserts, improve the geological environment in mining areas, and protect ecosystems on grasslands and farmlands. We will launch a new group of projects to return marginal cultivated land to forests or grasslands and return grazing land to grasslands and major projects to develop forests for ecological conservation. In 2015, we will return an additional 667 thousand hectares of cultivated land to forests or grasslands, and afforest six million hectares of land. We will vigorously develop energy conservation and environmental protection industries. We will advance desalination and comprehensive utilization of seawater.

4) We will actively address climate change.

We will implement the Interim Measures for the Management of Carbon Emission Rights Trading, and continue the pilot programs and demonstrations of low-carbon development. We will intensify South-South cooperation on climate change, and play a constructive part in the 2015 United Nations Climate Change Conference in Paris.

8. Working harder to ensure and improve people's wellbeing

We will integrate our efforts to improve people's wellbeing and invigorate social and economic development, and increase the investment in and effective supply of public goods and services.

1) We will take well-targeted steps to ensure employment.

We will implement and improve policies to increase employment and entrepreneurship, and encourage individuals to start their own businesses and make innovations. We will fully carry out the program for promoting the employment of college and university graduates and guiding college and university students in starting up businesses, and provide vocational skills training to rural migrant workers. We will increase our assistance to groups who have difficulty in finding a job; properly solve the issue of resettling and providing employment to workers laid off due to SOE mergers and reorganizations, the phasing-out of excess production capacity, or the shutdown of outdated production facilities; and implement and improve the policy on using unemployment insurance funds to support enterprises in ensuring job opportunities.

2) We will improve the social security system.

We will formulate an overall plan for deepening reform of the old-age insurance system and, at the appropriate time, launch trials of commercial pension schemes that allow for deferred payment of individual income tax. We will raise government subsidies for the new rural cooperative medical care system and the basic medical insurance for nonworking urban residents from 320 yuan to 380 yuan per person per year and also increase the annual individual contribution from 90 yuan to 120 yuan per person. We will introduce major disease insurance for rural and nonworking urban residents and the system of emergency assistance and temporary assistance for disease treatment across the country, and intensify efforts to provide medical assistance for treatment of major and critical diseases. We will improve the subsistence allowance system for both urban and rural residents and the social security policy for farmers whose land has been expropriated. We will raise subsidies and living allowances for entitled groups. We will establish a sound mechanism for supporting recovery and reconstruction efforts in areas hit by catastrophic natural disasters.

3) We will become better able to provide public services.

We will create new ways for providing public services, and expand government procurement of public services from nongovernmental sectors. We will continue to develop community-level facilities for employment and social security services. We will continue to improve the basic conditions of badly built and poorly operated schools in poor areas, accelerate the development of education in ethnic minority areas, improve the system for providing aid to students from poor families, ensure that the children of rural migrant workers in cities have the same access to compulsory education as local urban children, advance reform of the school examination and enrollment systems, and speed up the integration of vocational education with industry. We will strengthen special needs education, preschool education, continuing education, and all types of education in areas with concentrations of ethnic minorities. We will encourage nongovernmental sectors to run schools. In 2015, regular institutions of higher learning are planned to enroll seven million undergraduate students and 797,000 graduate students. We will carry out comprehensive reform of county-level public hospitals nationwide, expand comprehensive trial reforms of public hospitals in cities, improve policies and measures that encourage nongovernmental investment in the running of medical institutions, and continue to develop the system of medical services covering both urban and rural areas. We will vigorously develop traditional Chinese medicine and the traditional medicine of ethnic minorities. We will raise annual per capita government subsidies to basic public health services from 35 yuan to 40 yuan, with the entire additional sum in rural areas to be used for paying the basic public health services from rural doctors. We will accelerate development of the system of modern public cultural services, better preserve valuable cultural and natural heritage, and quicken reform and development of the culture industry as well as public cultural initiatives through the press and publishing; radio, film, and television; and literature and art. We will promote the flourishing of philosophy and the social sciences. We will steadily carry out trials for a system of national parks. We will strengthen infrastructure for tourism, and support the development of new models of tourism. We will intensify development of the system for elderly services. We will quickly establish a national database for basic population information. We will build more recovery and care facilities for people with disabilities and facilities for children's welfare. We will redouble efforts to develop the public service system for promoting national fitness.

4) We will make institutional innovations to strengthen construction of government-subsidized housing.

We will promote the use of direct monetary housing subsidies to people displaced by the rebuilding of run-down areas, and encourage municipal governments to utilize multiple means to increase the supply of public rental housing so that more people in urgent need of housing can find new homes as soon as possible. We will basically complete the renovation of run-down areas in state forestry areas and of dilapidated housing on state forestry farms. In urban areas, work on 4.8 million government-subsidized housing units will be basically completed and construction will begin on an additional 7.4 million units, including 5.8 million units to be rebuilt in run-down areas. We will give targeted guidance and adapt measures tailored to specific local conditions in order to vigorously support the people's demand for first homes or second homes if their first homes are inadequate, and spur the steady and sound development of the real estate market.

We will strengthen exchange and cooperation with Hong Kong and Macao in areas such as the economy and trade, and basically realize the liberalization of trade in services with the two regions by the end of 2015. We will support Hong Kong in elevating its position as an international financial, shipping, and trade center, and promote the long-term prosperity and stability of its economic and social development as well as the steady improvement of its people's wellbeing. We will support Macao in becoming a world tourism and leisure center and in building a platform for facilitating business and trade cooperation between China and Portuguese language countries, and will support appropriately diversifying its economy and promoting its sustainable development. We will expand and deepen exchange and cooperation in all fields between the mainland and Taiwan, quickly complete the follow-up talks on the cross-Straits Economic Cooperation Framework Agreement, and promote economic integration for the mutual benefit of all.

This year we have an additional important task to perform: on the basis of soliciting a wide range of opinions and drawing on the wisdom of the people, we must formulate the Thirteenth Five-Year Plan for National Economic and Social Development and complete the preparatory work for submitting it to the Fourth Session of the Twelfth NPC for deliberation.

Fellow Deputies,

Accomplishing all the work for economic and social development in 2015 is an onerous but important task. We will unite even closer around the CPC Central Committee with Comrade Xi Jinping as General Secretary, hold high the great banner of socialism with Chinese characteristics, take Deng Xiaoping Theory, the important thought of Three Represents, and the Scientific Outlook on Development as our guide, implement the guiding principles from General Secretary Xi Jinping's major speeches, willingly accept the oversight of the NPC, and seek comments and suggestions from the CPPCC National Committee with an open mind. We will pool together our hearts and our energy in striving to achieve all the targets set out in the Twelfth Five-Year Plan and promote sustainable and sound economic and social development.