4. Accelerating the reform of the financial system. This is an important task
affecting the overall interests of reform and development. We will accelerate
the reform of state-owned commercial banks by carrying forward the successful
pilot program to turn them into stock companies. The reform of policy banks and
other commercial banks will be carried forward. We will vigorously yet steadily
develop financial institutions with different forms of ownership. We will
continue working hard to implement the State Council's Guidelines for Promoting
the Reform, Opening Up and Steady Growth of the Capital Market. We will
strengthen the infrastructure of the capital market and formulate sound
regulations for it to protect the legitimate rights and interests of investors,
particularly non-government investors, thereby creating a favorable environment
for its steady and sound development. We will deepen the reform of the insurance
industry and standardize order in the insurance market. We will steadily
deregulate interest rates to leave them to market forces, and reform the
mechanism for setting the exchange rate for the Renminbi and keep it basically
stable at a proper and balanced level. We will improve the system of financial
oversight and management and strengthen and improve our financial oversight and
management work.
5. Promoting reform of fiscal and tax systems and the investment system. We
need to strengthen the public finance system and improve and standardize the
system of transfer payments from the central government. We will improve fiscal
systems at and below the provincial level. The VAT reform will be carefully
carried out on a trial basis in selected areas, and a plan will be formulated
for implementing the reform in all other areas. The mechanism for granting
export tax rebates will be improved. Reform of the budget management system will
be deepened. The government's decision on reforming the investment system will
be fully carried out, and we will formulate methods for implementing it and
improve the systems for examining and approving projects and keeping records. We
will establish a system for regulating investment from all sectors of society
that meets the needs of the new situation. We will standardize the scope and
procedures for government investment, improve the monitoring system, and
formulate a responsibility system for investments made by government bodies and
state-owned enterprises and a system for assigning responsibility for bad
investment decisions in order to eradicate the problem of no one being held
responsible for them.
6. Strengthening the market system. We will energetically develop the market
for factors of production. We will standardize and develop the equity exchange
market. The reform of the distribution system will be continued, and modern
distribution methods will be vigorously developed. Price reforms will be
deepened to better balance price relationships. We will thoroughly rectify and
standardize order in the market, focusing on continuing the work of cleaning up
the markets for food and medicine, which have a direct bearing on people's
health and safety. We will continue to rectify and standardize the agricultural
equipment and supplies, construction and real estate markets. A campaign to
protect intellectual property rights will be launched. We will severely crack
down on pyramid schemes and all other types of fraudulent commercial activities,
as well as economic crimes such as smuggling, tax evasion and fraud, and money
laundering. We will accelerate the establishment of a credit system for the
general public.
This year we are faced with many new situations as we open up the country to
the outside world. Tariffs need to be reduced to the level we promised when
China joined the WTO, most non-tariff measures need to be eliminated, and the
service sector needs to be opened wider to foreign competition. We need to
respond to these new situations to ensure success in opening up. First, we need
to speed up improvement in the growth pattern of foreign trade. We will improve
the export mix, promote upgrading of the processing trade and ensure continued
growth of exports. We will continue to effectually import energy, important raw
materials, key technologies and major equipment. We will reform the system of
port management and simplify customs clearance procedures. We will handle
international trade frictions and disputes properly. Second, we need to continue
to utilize foreign capital energetically and rationally. We need to improve the
performance of foreign capital and better integrate efforts to attract foreign
investment with efforts to improve the country's industrial structure and
technological level. We will encourage foreign investors to invest in new and
high technology industries, modern services, modern agriculture and the central
and western regions. We will keep the number of projects that consume excess
quantities of resources and are highly polluting to a minimum. Third, we need to
further implement the "go global" strategy. We will encourage qualified
enterprises to invest and do business in other countries, give them more credit,
insurance and foreign exchange support, and strengthen guidance and coordination
for enterprises operating abroad. We will develop a sound system for managing
and supervising state assets abroad. Fourth, we need to do all work for the
transition period of our entry into the WTO promptly and well. We will continue
to develop multilateral and bilateral economic relations and actively
participate in regional economic cooperation.
