BEIJING: China has set a sound growth target for 2021, leaving room for policymakers to carry out arduous reforms to tackle bottlenecks constraining sustainable development.
“A target of over 6% (of economic growth) will enable all of us to devote full energy to promoting reform, innovation, and high-quality development, ” premier Li Keqiang said in the government work report delivered to the national legislature, which began its annual session Friday.
The report, along with the draft blueprint setting the country’s development priorities for the period up to 2035, both of which are being discussed at the annual “two sessions” of the country’s top legislature and political advisory body, outlined key areas where reforms are expected to bring institutional changes and bolster the country’s long-term growth.
China will raise its capacity for pursuing scientific and technological innovation, leveraging market forces to encourage enterprises to innovate, according to the report.
To that end, the country will offer preferential tax policies to encourage research and development (R&D), especially for manufacturing enterprises, the report said.
The draft outline of the 14th Five-Year Plan (2021-2025) for national economic and social development and the long-range objectives through the year 2035 also identified self-reliance in science and technology as a strategic underpinning for national development.
Guo Wei, deputy director of the Research Office of the State Council, said that the building of tech strength is a sustained process that requires efforts from all parties.
Market-oriented mechanisms are necessary to incentivise more R&D spending by firms.
Liu Wei, a national political adviser and chairman of Guangzhou-based artificial intelligence (AI) provider PCITECH, said that while the country already enjoyed a competitive edge globally in fields such as AI-powered transport and medical services, the application scenarios for the technology were still limited.
He proposed that the government and state-owned enterprises work with private companies to apply AI technology in areas like smart cities and urban rail transit.
China’s advancement in technology will not only be crucial for its own growth, but offers benefits to the wider world, breaking the technology monopoly by many developed countries and lowering the prices of key technologies, said Li Daokui, an economist with Tsinghua University and a national political adviser.
China will take expanding domestic demand as a strategic move and fully tap the potential of the domestic market, according to the report.
The move is in line with the country’s prolonged transition from an investment-driven growth model to one that depends more on domestic demand, which is considered more able to withstand external shocks.
The reform on expanding domestic demand does not only mean short-term consumption stimulus, but improvements in mechanisms, including integrated urban-rural development and income distribution, analysts said.
Liu Shangxi, head of the Chinese Academy of Fiscal Sciences and a national political advisor, said that both demand-side and supply-side reforms are needed to unleash the country’s consumption potential. ─ Xinhua