2. We will focus on rural economic development and make substantial progress in building a new socialist countryside. We need to consolidate, improve and strengthen policies for supporting agriculture and giving favorable treatment to farmers, provide more support for agriculture, rural areas and farmers, and promote restructuring of agriculture and the rural economy.1) We need to steadily expand grain production. We will continue the project to industrialize the production of high-quality grain varieties and continue to develop large state commercial grain bases. We will improve the policy of granting direct subsidies to grain growers and general direct subsidies for agricultural supplies, and increase the amount of subsidies for growing superior grain varieties and purchasing agricultural machinery and tools. We will carry forward the minimum purchase price policy for key localities and key grain varieties. We will set up a sound food security warning system to strengthen monitoring and regulation of grain production, storage and imports and exports.2) We need to vigorously promote the development of modern agriculture. We will improve agricultural technology and equipment and facilities for basic research in agricultural science and widen the application of advanced applied agricultural technologies. We will step up efforts to develop cotton, oilseed and sugar crop production bases, encourage localities to develop intensive livestock, poultry and aquatic farming as appropriate for local conditions, and continue the projects to cultivate superior varieties and breeds, to protect vegetation and to set up demonstration zones for modern agriculture. We will do a good job developing the system for quality and safety inspection of agricultural products and the system for preventing and controlling animal epidemics, and improve the comprehensive system of agriculture-related services.3) We need to continue improving working and living conditions in the countryside. We will accelerate the project to improve soil fertility, build more small and medium-sized water conservancy facilities, support water-saving efforts in large irrigated areas and the building of drainage pumping stations in the central region, and step up efforts to renovate dilapidated reservoirs. We will increase investment in rural roads and water, gas and electricity facilities. We will provide safe drinking water for another 32 million rural residents, add 5 million to the number of rural households using methane and support improvement of roads connecting county seats and townships and the building of roads to villages. We will upgrade rural power grids and extend power grids to more areas without electricity in the central and western regions.4) We need to accelerate the development of rural social programs. We will exempt all rural students receiving compulsory education from paying tuition and miscellaneous fees. We will continue to provide free textbooks to students from poor families and living allowances to poor students staying in dormitories. We will complete the project to develop modern distance learning at the elementary and middle school level and the task of making nine-year compulsory education generally available and basically eliminating illiteracy among young and middle-aged adults in the western region. We will continue the project to build and renovate rural boarding schools and begin work to improve rural middle school buildings in the central and western regions. We will vigorously develop the rural health service system, focusing on health clinics in towns and townships, and expand the area covered by the new rural cooperative medical care system. We will begin building multipurpose cultural centers in towns and townships and carry forward the project to extend radio and TV coverage to all villages and the project to screen more movies in rural areas.5) We need to expand channels for increasing rural incomes. We will expand secondary and tertiary industries in the countryside, accelerate development of highly efficient cash crops and livestock, poultry and aquatic products, improve the quality and safety of agricultural products, increase income from farming, livestock, poultry and aquatic breeding and forestry, promote industrialized management of agricultural production and support development of leading enterprises. We will develop rural economic cooperatives and strengthen county economies. We will give rural residents vocational training of all types to help them become better qualified to get jobs or start their own business.6) We need to set up a mechanism to ensure stable growth of investment in rural areas. We will promote improvement in the pattern of investment in rural programs and set up a mechanism for coordinating investment programs and plans and for communication among relevant departments to improve the management of investment.

3. We need to work hard to reduce energy consumption and pollution emission, strengthen environmental protection, conserve land and use land more intensively.

To attain a reduction in energy consumption per unit of GDP of about 20% and emission of major pollutants of 10%, within a period of five years as required in the Outline of the Eleventh Five-Year Plan, we must forge ahead in spite of difficulties, adopt more effective measures and work even harder. We must make energy saving, decreased energy consumption, reduced emission of pollutants and conservation and intensive use of land the breakthrough point and main fulcrum for accelerating economic restructuring and changing the pattern of economic growth. We will energetically develop the service and high-tech industries, encourage the use of modern technology to transform traditional industries, provide guidance for enterprise mergers and reorganizations, promptly eliminate backward production facilities that cannot meet the requirements for market access in industries that consume large quantities of energy or seriously pollute the environment and promote more efficient development. At the same time, we must do a good job in the following eight areas.

1) We need to implement an accountability system. We need to strictly adhere to a responsibility system for meeting targets for energy conservation and consumption reduction and reduction of pollutant emission, promptly set up a unified, scientific system of statistical indicators and a monitoring system for reducing energy consumption and pollutant emission, and improve the performance assessment mechanism for the same purpose.2) We need to focus on key areas. We will use funds from both central and local government budgets to carry out ten major state energy conservation projects including those to upgrade low-efficiency coal-fired boilers (furnaces), to develop district combined heating & power facilities, to utilize by-product heat and pressure, to conserve petroleum and find petroleum substitutes and to promote a wider use of environment-friendly lighting in key industries and areas such as steel, non-ferrous metals, power, petroleum and petrochemicals, chemicals and building materials. We will strengthen energy conservation management in key enterprises that each burn more than 10,000 tons of standard coal annually, launch a campaign to save energy in about 1,000 large enterprises with extremely high-energy consumption, tighten energy auditing, and step up efforts to develop and promote the use of major energy-saving technologies that have great potential for saving energy and can be widely applied in highly energy-consuming industries.

3) We need to attack the roots of the problem. We will follow an energy-saving evaluation and examination system for fixed asset investment projects and make energy efficiency a mandatory criterion in project examination, approval and development. We will adopt minimum energy efficiency standards for products whose manufacture is high in energy consumption, work out and implement quotas of energy consumption in production, set up a system of energy consumption limits for public buildings and expand the scope of mandatory energy efficiency labeling. We will improve power generation and distribution and accelerate efforts to encourage larger thermal power plants and discourage smaller ones by shutting down small thermal power generating units with a total power generating capacity of 10 million kilowatts. We will require all new thermal power plants to install desulphurization equipment, issue a plan for controlling sulfur dioxide emission of coal-fired power plants and carry out the trial of exclusive distribution of desulphurization equipment. We will work hard to close down backward iron foundries with total production capacity of 30 million tons and backward steel mills with total production capacity of 35 million tons.

4) We need to increase policy support. We will improve the fiscal and tax policies for encouraging energy conservation and reduction of energy consumption. An energy-saving fund has been set up in the central government budget to support the application of highly efficient, energy-saving products and the operation of major energy conservation projects and the major demonstration projects for energy-saving technologies. We will improve the policy of differential electricity and water charges for enterprises that consume large amounts of energy or are highly polluting. We will improve the system of charges for pollutant emission. All cities and towns must begin collecting charges for sewage treatment by the end of the year and gradually increase the charges, and all cities must begin collecting charges for garbage disposal within the specified time. We will increase the price for electricity from coal-fired power plants using desulphurization equipment and disallow the increased price for power plants that turn off desulphurization equipment without a proper reason and fine them severely. We will introduce a policy to encourage the use of by-product heat and pressure, coal gangue and waste incineration to generate power and set preferential prices for electricity from such sources when supplied to the state power grids.

5) We need to develop a circular economy. We will promptly formulate a national plan for the development of a circular economy, improve the system of assessment indicators and statistical database for a circular economy, and press ahead with the first group of trial projects for a circular economy. We will energetically promote comprehensive utilization of resources and do a good job conducting trials to recycle renewable resources, recover and dispose of used home appliances and remanufacture auto parts.

6) We need to do more to protect the environment. We will fully promote clean production, carry out mandatory clean production inspections in enterprises whose pollution discharge seriously exceeds stipulated standards and order them to make corrections within a prescribed time. We will continue our comprehensive efforts to prevent and control pollution in key river valleys and regions, including the Huai, Hai, Liao and Songhua rivers, Tai, Chao and Dianchi lakes, the Bohai Sea, the Three Gorges Reservoir area and the upper reaches of the Yangtze River, and the sources and routes of the South-to-North Water Diversion Project. We will strengthen guarantees for the safety of urban drinking water supplies, improve the capacity of cities to treat sewage and waste, and stop direct discharge of pollutants into the zones for conserving and protecting potable water sources according to law. We will vigorously develop the environmental protection industry.

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