Chinese Premier Wen Jiabao delivers a government work report during the opening meeting of the Fourth Session of the 11th National People's Congress (NPC) at the Great Hall of the People in Beijing, capital of China, March 5, 2011. (Xinhua/Huang Jingwen)
LITERAL READING?
The decision is made as the international financial crisis has exerted deep impacts, global economic growth remains slow, and China's development is unbalanced, uncoordinated and unsustainable, according to the draft 12th Five-Year Plan submitted to the annual parliamentary session Saturday.
"The target does not mean China's economic rise will slow down to seven percent," noted He Qiang, a financial expert with the Central University of Finance and Economics. One consideration is that it is conducive to prevent an overheating of the economy, he said.
Also, the continuous elimination of outdated industrial capacity will put pressures on economic growth, he said.
"A lower growth rate leaves room for possible economic fluctuations during the five years in case global or regional economic crisis bites again," said Wang Jun, a macro-economic researcher with the China Center for International Economic Exchanges, a government think tank.
The move also indicates the government has become more tolerant of slower growth, and policy-making can become more flexible in the next five years, he said.
Other economists see the voluntary abandonment of addiction to fast growth marks the government's firm determination to revamp the economy by reducing dependence on exports and capital- and energy-intensive industries. Instead, conditions for more domestic demand will be built.
