REPORT ON THE IMPLEMENTATION OF THE 2020 PLAN FOR NATIONAL ECONOMIC AND SOCIAL DEVELOPMENT AND ON THE 2021 DRAFT PLAN FOR NATIONAL ECONOMIC AND SOCIAL DEVELOPMENT
Delivered at the Fourth Session of the 13th National People’s Congress on March 5, 2021
National Development and Reform Commission
The National Development and Reform Commission has been entrusted by the State Council to deliver this report on the implementation of the 2020 plan, and on the 2021 draft plan for national economic and social development to the present Fourth Session of the 13th National People’s Congress (NPC) for your deliberation and approval. The Commission also invites comments from members of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC).
I. Implementation of the 2020 Plan for National Economic and Social Development
Last year was an extraordinary year in the history of the People’s Republic of China (PRC). Faced with a grave and complex international situation, the challenging tasks of advancing reform and development and ensuring stability at home, and the severe impact of the Covid-19 epidemic in particular, the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, while keeping overall national interests in mind, maintained a strategic focus, judged situations accurately, formulated meticulous plans, took decisive action, made arduous efforts, and promptly adopted the major policy of coordinating epidemic prevention and control with economic and social development.
Under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, all regions and departments fully implemented the guiding principles of the 19th CPC National Congress and the second, third, fourth, and fifth plenary sessions of the 19th CPC Central Committee. In accordance with the decisions and plans of the Party Central Committee and the State Council, we faithfully implemented the Report on the Work of the Government and the 2020 Plan for National Economic and Social Development approved at the Third Session of the 13th NPC, and adopted the NPC Financial and Economic Affairs Committee’s suggestions based on its review of the 2020 plan.
We responded to risks and challenges with composure, and continued to pursue high-quality development. We coordinated the Covid-19 response with economic and social development, and took solid steps to ensure stability on six key fronts and maintain security in six key areas.
China’s economy saw a quarter-on-quarter improvement and gradually returned to normality, constituting the sole major economy to have realized positive growth. We achieved a complete victory in the battle against poverty, and scored decisive achievements in securing a full victory in building a moderately prosperous society in all respects, delivering a globally-acclaimed performance that satisfied the needs of the people and that will be recorded in the annals of history.
1. We put the health and safety of our people before all else and saw major strategic achievements in the fight against Covid-19.
Faced with the sudden and severe challenges posed by Covid-19, General Secretary Xi Jinping personally took charge, planned our response, and unified the Chinese people of all ethnic groups in rapidly launching an all-out people’s war to contain the virus. In just over a month’s time, we had largely contained the spread of the virus in China. In roughly two months, we had reduced the daily number of new local cases to single digits. And in approximately three months, we had secured a decisive victory in the battle to defend Hubei Province and its capital city Wuhan. After this, we effectively dealt with a number of local outbreaks and sporadic cases.
1) No effort was spared to control the epidemic and treat patients.
We coordinated the efforts of the whole country in accordance with the general requirement to stay confident, stand united, and adopt both a science-based approach and targeted measures. A central leading group for coordinating the epidemic response was established and a central guidance team was dispatched to Hubei. Full play was given to the functions of the State Council interdepartmental task force. The entire country was mobilized in the fight to protect Hubei and Wuhan and to curb local transmission of the virus. We gave clear guidelines for the early detection, reporting, isolation, and treatment of cases, and mandated that patients be treated in designated facilities where the best doctors and medical resources were concentrated. We ensured that all treatment-related costs were borne by the state, and worked to raise hospital admission and recovery rates and to bring down infection and mortality rates.
We carried out an interdepartmental and society-wide epidemic prevention and control effort. One after another, provinces, autonomous regions, and municipalities directly under the central government activated level-one responses to this major public health emergency. Officials were dispatched to communities to ensure effective local epidemic control, and social organizations of all kinds, specialized social workers, and volunteers received the guidance required to provide epidemic control and social services in accordance with the law and in an orderly manner.
We took firm steps to guarantee medical supplies and to stabilize the supply and prices of daily necessities. We quickly ramped up the production of face masks and other medical protective materials and medical equipment, and added more hospital beds, thereby ensuring that epidemic control needs were essentially met. We did everything possible to ensure the well-coordinated allocation of labor in key production areas to guarantee stability in the supply and prices of grain, cooking oil, and other foods such as meat, eggs, vegetables, and milk. Various measures were taken to maintain the security and stability of energy supplies, and to ensure safe medical waste and wastewater disposal.
We coordinated scientific research with clinical treatment and prevention and control work, speedily developed nucleic acid testing kits, accelerated both the selection of effective medicines and vaccine development, and began vaccination using domestically produced vaccines. In so doing, we fully leveraged the role of science and technology in our efforts to contain the epidemic.
In response to the rapid spread of the epidemic around the world, and while still guarding against the risk of inbound cases, the Chinese government provided care and support for overseas Chinese nationals and arranged temporary flights to support the orderly transit of Chinese citizens facing difficulties abroad back to China.
2) There was no let-up in routine epidemic control efforts.
As the situation evolved, we shifted the focus of our national response to guarding against inbound cases and domestic resurgence, and changed from an emergency response mode to one of routine epidemic control. We developed routine mechanisms for rapidly detecting and handling cases, for taking targeted measures to suppress resurgence, and for providing effective treatment. Substantial utilization of modern information technologies and the widespread introduction of health code verification allowed for continuous improvement in the precision of routine control work, thus helping to maintain regular production and daily household activities.
Faced with a domestic resurgence characterized by sporadic local outbreaks, we continued to apply differentiated response measures tailored to different localities. Targeted adjustments were made to the risk levels of different regions, while epidemiological investigations and the use of big data for tracing infections were launched as rapidly as possible. We focused on discovering and strengthening weak links, continuously improved our nucleic acid testing capacity, and strengthened prevention and control in key areas such as cold-chain logistics.
3) International cooperation in combating the epidemic was promoted.
China has acted in an open, transparent, and responsible manner, and has earnestly fulfilled its international obligations. The Chinese government reported the outbreak of the epidemic to the world at the first opportunity, released the genome sequence of the virus to the world as soon as it was determined, immediately shared China’s diagnostic and therapeutic protocols and containment measures, and firmly supported the World Health Organization (WHO) in playing its leading role. We set up an online Covid-19 knowledge center open to all, and published eight versions of diagnostic and therapeutic protocols and seven versions of containment protocols, unreservedly sharing our prevention, control, and treatment experiences with all.
We launched the largest global humanitarian assistance campaign since the founding of the PRC, provided assistance both to the WHO and for the Covid-19 Global Humanitarian Response Plan launched by the United Nations, dispatched 36 teams of medical experts to 34 countries in need of them, and provided assistance in combating the epidemic to 150 countries and 13 international organizations. Giving full play to our strengths as the world’s largest supplier of epidemic prevention materials, over the course of the year we provided more than 200 countries with over 220 billion face masks, 2.3 billion protective gowns, and 1 billion testing kits. We actively pushed forward cooperation on drug and vaccine R&D as well as global joint prevention and control. We also helped developing countries to overcome the challenges brought by the epidemic.
2. We formulated and implemented macro policies to meet the urgent needs of market entities, and facilitated a stable and sustained economic recovery.
Confronted with the impact of Covid-19, the severity of which has rarely been seen in history, we made ensuring stability on the six fronts the foundation of our efforts, and clearly defined the tasks required for maintaining security in the six areas, with a particular emphasis on securing employment, meeting basic living needs, and protecting market entities. We remained committed to maintaining security in order to deliver the stability needed to pursue progress. Taking into account China’s national conditions and realities, we took prompt and decisive action while maintaining our resolve, and refrained from resorting to a deluge of strong stimulus policies. Instead, we balanced large-scale economic policies and intensified our macro policies to counteract the negative impacts of Covid-19, thereby strengthening the internal forces driving economic growth and ensuring more balanced and more sustainable development.
1) Major indicators were better than expected.
China’s gross domestic product (GDP) in 2020 reached 101.6 trillion yuan, an increase of 2.3%. A total of 11.86 million urban jobs were created and the year-end surveyed urban unemployment rate was 5.2%. The consumer price index (CPI) rose by 2.5%. A basic equilibrium was maintained with regard to the balance of payments, and foreign exchange reserves were kept at over US$ 3 trillion.
2) Epidemic relief policies for enterprises were effectively implemented.
We implemented large-scale tax cuts and fee reductions on a time-limited basis in order to help enterprises. We reduced or eliminated VAT on small-scale taxpayers in the current stage, temporarily reduced or waived enterprises contributions to basic old-age insurance, unemployment insurance, and workers’ compensation schemes, halved enterprises contributions to basic medical insurance for urban workers, and implemented time-limited supportive policies on the housing provident fund, saving market entities more than 2.6 trillion yuan over the course of the year.
We developed new methods for implementing macro policies. The central government established mechanisms for ensuring that the additional two trillion yuan of government bonds went directly to prefecture and county governments, and provincial-level governments channeled more financial resources to lower-level governments. These combined measures supported prefecture and county governments in implementing policies to benefit both enterprises and the people.
We introduced supportive monetary measures with a value of over nine trillion yuan by means such as required reserve ratio reductions, medium-term lending facilities, open market operations, re-lending and rediscounts, and by developing new monetary policy instruments that directly serve the real economy. We also implemented the loan prime rate (LPR) mechanism to reduce the cost of financing. Large commercial banks increased inclusive loans to micro and small enterprises (MSEs) by more than 50%. Over the year, the financial sector saved enterprises 1.5 trillion yuan via measures to boost the real economy. Rental payments for certain MSEs and self-employed individuals in the service sector were reduced, waived, or postponed for a certain period of time.
3) The expectations of market entities remained stable and positive.
We promptly put in place and constantly improved nationwide epidemic information-sharing mechanisms, released authoritative epidemic information in an accurate and transparent manner, and effectively ensured the continuation of normal production and daily life activities.
We gave full play to the role of macro-policy coordination mechanisms and consultation mechanisms between major provinces and cities in order to ensure stability on the six fronts and security in the six areas. Policy coordination between central and local authorities and between departments was also strengthened. The macroeconomic governance system was improved, and our policies became more stable, predictable, and transparent. We offered timely explanations of developments and policies, actively responded to public concerns, and maintained the confidence of market entities.
3. We made solid progress in the three critical battles2, and achieved the main targets and accomplished the main tasks on schedule.
We implemented policies to solve prominent problems and strengthen weak links, completed all goals and tasks for fighting poverty, stepped up efforts to address pollution, and effectively prevented and controlled major risks.
1) We won a complete victory in the battle against poverty.
We listed all the counties and villages which had not yet eliminated poverty in order to oversee their poverty-alleviation efforts, and channeled poverty-alleviation funds toward deeply impoverished areas such as the three regions and the three prefectures.3 To offset the impact of Covid-19 and flooding on poverty alleviation, we prioritized efforts to support impoverished workers in finding jobs, and expanded work-relief programs through multiple channels. We increased support for poverty alleviation by boosting local industries and employment, ensured better linkage between production and sales, strengthened science and technology-based assistance, launched programs to boost the consumption of goods produced in poor areas, and promptly implemented measures to ensure that people’s basic living needs are met. We rolled out follow-up support policies and measures for relocated families, and completed the task of relocating over 9.6 million people from inhospitable areas during the 13th Five-Year Plan period.
We worked to consolidate the progress already achieved in guaranteeing access to compulsory education, basic medical services, and housing for rural poor populations. We coordinated the development of basic medical insurance, major disease insurance, and medical assistance programs to ease the burden of medical expenses for poor populations. Final-phase projects to renovate dilapidated rural houses were completed on schedule. All people who were formerly living below the current poverty line now have access to safe drinking water. We conducted a nationwide poverty reduction survey, and improved monitoring and support to prevent people from falling back into poverty.
The 98.99 million rural residents formerly living below the current poverty line were successfully lifted out of poverty, and poverty has been eliminated in all of the 832 impoverished counties and the 128,000 poor villages. Both extreme poverty and regional poverty have therefore been eradicated.
2) We achieved the current-stage objectives for pollution prevention and control.
We made steady progress in promoting energy conservation and emissions reduction, and saw a continued decline in energy consumption and carbon dioxide emissions per unit of GDP. The share of non-fossil fuels in the total energy consumption reached 15.9%.
We pushed ahead with the campaign to keep our skies blue, our waters clear, and our land pollution-free. We continued to comprehensively address air pollution in key areas during autumn and winter, launched initiatives to prevent and control ozone (O3) pollution in summer, and moved forward with the adoption of clean energy sources for winter heating in northern China in an active yet prudent manner. We steadily advanced upgrading in the steel industry in order to achieve ultra-low emissions. We curbed pollution caused by diesel trucks, and continued to bring about a shift in freight transportation from highways to railways and waterways. As a result of these efforts, air quality of cities at and above the prefectural level was good or excellent for 87% of the year.
We accelerated work to improve the quality of key water basins of major rivers and lakes, including the Yellow River and the Yangtze River, along with water quality in key sea areas such as the Bohai Sea. We stepped up protection of drinking water sources and the treatment of black, malodorous water bodies in urban areas. The proportion of surface water with a quality rating of Grade III or higher stood at 83.4% while the proportion of that lower than Grade V dropped to 0.6%. As the nationwide water conservation campaign unfolded, water consumption per 10,000 yuan of GDP is estimated to have fallen by 1.9%.
We worked to ensure that cropland and other plots of land that have been polluted are utilized in a safe manner. We continued to control pollution in agriculture and rural areas and carried out comprehensive trials for building waste-free cities. We made solid progress in recycling sewage, addressing plastic pollution, and disposing of medical waste. We stepped up the building of resource recycling centers and centers for the comprehensive use of massive solid waste, and essentially achieved the goal of zero solid waste imports. We accelerated the establishment of a modern environmental governance system, and ensured that the emissions permit system covers all fixed pollution sources in the country.
We took strong measures to develop national ecological conservation pilot zones. We strengthened the protection and restoration of ecosystems, moved forward with large-scale afforestation, and stepped up environmental protection in the Yangtze, Yellow, and Lancang river sources, the Qilian Mountains area, and other key areas through comprehensive measures. We enhanced our ability to protect and manage major ecosystems, including the prevention and fighting of forest and grassland fires and the conservation of wetlands. We intensified oversight of ecological conservation red lines. We developed green industry demonstration centers and promoted advanced green technologies.
As an important participant and a leading nation in global climate governance, we proactively responded to climate change and raised the targets for the intended nationally determined contribution. We allocated quotas for trading carbon emission rights for the first compliance cycle of the national market.
3) We achieved excellent results in forestalling and defusing major risks.
We took prudent steps to defuse local government debt risks, continued to push forward structural deleveraging, and resolutely checked increases in hidden local government debt.
We promptly dealt with a number of major financial risks. All types of high-risk financial institutions were managed in an orderly manner. Shadow banking risks were kept in check, targeted efforts to defuse particular risks proved effective, and steps were taken to effectively prevent and control risks related to internet finance. We gradually developed diverse mechanisms for handling bond defaults, and put in place a framework for the coordinated regulation of systemically important financial institutions, financial holding companies, and financial infrastructures. Initial progress was achieved in efforts to forestall and defuse major financial risks, and the operations of the financial market were stable and orderly.
We ensured the stable supply of important materials, key spare parts, core components, and key software, thus maintaining the stability of the industrial and supply chains.
4. We promoted innovation-driven development, and further boosted China’s strengths in science and technology.
We intensified innovation, and consolidated its core role in China’s modernization drive. Nationwide spending on R&D reached 2.4% of GDP, and the contribution made by advances in science and technology is estimated to account for 60.2% of economic growth.
1) China’s innovation capacity was enhanced.
We saw a constant stream of significant scientific and technological advances throughout the year. The successful completion of the Chang’e-5 mission marked China’s first extra-terrestrial sample collection. We saw the successful launch of the Tianwen-1 probe – China’s first mission to Mars. The Five-Hundred-Meter Aperture Spherical radio Telescope (FAST) officially began operation, and the Beidou-3 global navigation satellite system officially became operational. The quantum computer prototype Jiuzhang was successfully developed, and the deep-sea manned submersible Fendouzhe descended to a depth of more than 10,000 meters.
We opened a number of national laboratories, accelerated the deployment and implementation of major projects for the Sci-Tech Innovation 2030 Agenda involving next-generation artificial intelligence (AI), quantum communications and computing, and brain science and brain-inspired research, and fully participated in international Big Science programs such as the International Thermonuclear Experimental Reactor project.
We accelerated the development of innovation platforms. We advanced the establishment of a number of high-level national industrial innovation centers, engineering research centers, technology innovation centers, manufacturing innovation centers, and enterprise technology centers in strategically important fields such as next-generation information technology, biomedicine, and new energy. We accelerated the construction of national large research infrastructures such as the High Energy Photon Source, the Hard X-Ray Free-Electron Laser, and the China Environment for Network Innovations.
2) We strove to achieve breakthroughs in core technologies in key fields.
We implemented the open competition mechanism for selecting the best candidates to lead research projects, and actively explored and improved a new system for mobilizing the nation to make technological breakthroughs under the socialist market economy. We worked faster to deal with technological bottlenecks. We strengthened the leading role played by enterprises in innovation, encouraged enterprises to increase spending on R&D, and supported enterprises in carrying out R&D in technology together with research institutes and upstream and downstream enterprises, while we made constant innovations in support mechanisms.
3) New industries and new forms of business developed despite challenges.
We undertook projects to develop China’s strategic emerging industry clusters, drove forward the construction of civil-space infrastructure, steadily advanced the construction of new types of infrastructure including 5G, data centers, and the industrial internet, and promoted the orderly development of the integrated circuit industry.
We promoted industrial upgrading through the utilization of digital and smart technologies, pressed ahead with the building of national pilot zones for the innovative development of the digital economy, and carried out the digital transformation partnership campaign, the small and medium enterprises (SMEs) digitalization campaign, and the initiatives for cultivating new forms of business in the digital economy, involving more micro, small, and medium enterprises (MSMEs) in cloud-based big data and AI initiatives. We continued the digitalization of traditional industries and put more effort into fighting poverty through the promotion of e-commerce.
4) We accelerated the development of innovation hubs in key areas.
We achieved early successes in developing Beijing, Shanghai, and the Guangdong-Hong Kong-Macao Greater Bay Area into international centers for science and technology innovation, made a great leap in the construction of comprehensive national science centers, and continued the development of industrial innovation hubs. We accelerated the development of national innovation demonstration zones and national new- and high-tech industry development parks, thereby further improving the coordinated distribution of productive and innovative forces.
5) We continued to establish a new environment for innovation, business startups, and creativity.
We applied the third batch of 20 practices developed in pilot reforms for making innovations across the board. We held the 2020 National Entrepreneurship and Innovation Week both online and offline, and made plans for building a third group of innovation and business startup demonstration centers. We carried out demonstration programs in the social services sector for job creation via business startups. We further implemented the policy of guaranteeing loans for business startups. In 2020, we saw an average net increase of 41,000 market entities per day, of which 13,000 were enterprises.
5. We firmly pursued the strategy of expanding domestic demand, and facilitated the faster development of a strong domestic market.
We worked hard to maintain dynamic circulation in order to ensure that market supply meets demand. We tapped into and unlocked the demand potential of the domestic market, and steadily stimulated domestic demand as a driver of economic growth.
1) Consumption played a more fundamental role.
We supported the leading role of new forms and models of business in accelerating the development of new types of consumption. We worked faster to develop a number of cities into international consumption centers. We oversaw the careful implementation of pilot and demonstration schemes to boost the consumption of information goods and services and spending in the cultural and tourism sectors. We improved the quality and expanded the scale of consumption in elderly care and childcare services, and moved forward with comprehensive demonstrations for introducing e-commerce into rural areas.
We both stabilized and expanded the purchase of automobiles and spending on other big-ticket items. We boosted consumption in the catering sector, and further unleashed the consumption potential of rural areas. We stepped up the building of a recycling system for old home appliances to boost purchases of new home appliances. In 2020, total retail sales of consumer goods reached 39.2 trillion yuan, and total online retail sales nationwide reached 11.8 trillion yuan, an increase of 10.9%. Sales of goods online increased by 14.8% and accounted for 24.9% of the total retail sales of consumer goods.
2) Greater play was given to the key role of investment.
We issued the guidelines on promoting high-quality infrastructure development and the guidelines on accelerating the development of intra-city (suburban) railways for metropolitan areas. We invested more in new infrastructure and new urbanization initiatives and major projects, and began the construction of a number of major projects including the Chengdu-Lhasa Railway.
We sped up releasing the central budgetary investment plan for local governments and improved the structure of investment at pace, pooling more resources to accomplish major, challenging, and urgent national goals. We prioritized public health and other weak areas exposed during the Covid-19 response while emphasizing the development of railways, highways, waterways, airports, and major water conservancy projects, as well as key science, technology, and energy infrastructure. We also gave precedence to the renovation of old residential communities in cities.
We expanded the usage scope for local government special bonds in order to support the construction of major national strategic projects. We successfully implemented the long-term mechanism for opening projects to private capital, and welcomed private investment in major projects. We also launched real estate investment trusts (REITs) trials for infrastructure in order to release the value of idle assets. We deepened reform of the investment approval system, actively explored an investment project commitment system, and made steady progress on ensuring that multiple approval procedures can be initiated, reviewed, and completed simultaneously. The fixed-asset investment for the year (excluding investment by rural households) rose by 2.9%, thus significantly contributing to economic recovery and growth.
3) We accelerated the establishment of a modern distribution system.
To advance the development of high-quality, modern logistics, we made plans to build another 22 national logistics hubs. To create an enabling environment for the distribution of fresh agricultural products, we made plans to build 17 national pivotal cold-chain logistics bases which will serve areas producing local specialty agricultural products and agricultural product distribution centers. We also moved faster to create a modern logistics operation system that incorporates logistics gateways, hubs, and networks. To introduce new models for logistics services, we encouraged the healthy and well-regulated development of new forms of Internet Plus freight transportation businesses, and promoted full integration between logistics and manufacturing to boost their innovative development. To lower costs and increase efficiency in the distribution process, we made coordinated efforts to bring down both technology costs and government-imposed transaction costs.