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This year, the Communist Party of China will hold its 19th National Congress, so it will be a year of great significance for advancing the cause of the Party and our country. To deliver in our work this year, the government will do the following:

-- Follow the leadership of the Party Central Committee with Comrade Xi Jinping at its core

-- Hold high the banner of socialism with Chinese characteristics

-- Implement fully the guidelines from the 18th National Party Congress and those of the third through sixth plenary sessions of the 18th Party Central Committee

-- Take as our guide Deng Xiaoping Theory, the Theory of Three Represents, and the Scientific Outlook on Development

-- Put into practice the principles from General Secretary Xi Jinping's major addresses and his new vision, thinking, and strategies for China's governance

-- Promote balanced economic, political, cultural, social, and ecological progress and coordinated implementation of the Four-Pronged Comprehensive Strategy(1)

-- Remain committed to the underlying principle of making progress while keeping performance stable

-- Gain a strong understanding of and put into practice the new development philosophy

-- Adapt to, approach in the right way, and steer the new normal in economic development

-- Give central importance to improving the quality and returns of development

-- Ensure that macro-level policy is consistent, industrial policy is targeted, micro-level policy injects dynamism into the market, reform policy delivers outcomes, and social policy sees basic living needs are met

-- Focus on supply-side structural reform

-- Expand aggregate demand as appropriate

-- Do better in guiding expectations

-- Strengthen the role of innovation in driving development

-- Maintain stable growth, promote reform, make structural adjustments, improve living standards, and guard against risks

-- Maintain stable and sound economic development as well as social harmony and stability

These efforts should enable us to pave the way for the 19th National Party Congress with outstanding achievements.

Note: (1) This refers to making comprehensive moves to finish building a moderately prosperous society in all respects, deepen reform, advance the law-based governance of China, and strengthen Party self-governance.

The developments both in and outside of China require that we are ready to face more complicated and graver situations. World economic growth remains sluggish, and both the deglobalization trend and protectionism are growing. There are many uncertainties about the direction of the major economies' policies and their spillover effects, and the factors that could cause instability and uncertainty are visibly increasing. China is at a crucial and challenging stage in its own development endeavors, and there are many salient challenges and problems in the economy.

The difficulties we face are not to be underestimated, but we must remain confident that they will be overcome. China has a solid material foundation, abundant human resources, a huge market, and a complete system of industries. It is making faster scientific and technological progress, and has a complete range of infrastructure. We have good conditions for sustaining economic development, and many innovative tools and policy options for conducting macroeconomic regulation. We should follow the leadership of the Party, uphold the Party's fundamental political guidelines, and keep to the path of socialism with Chinese characteristics; we should rely on the inexhaustible creativity of the people, unite as one, and forge ahead. It is our firm belief that by doing this, we will make great new achievements in China's development.

Based on the above considerations, we have set the following key projected targets for development this year:

-- GDP growth of around 6.5 percent, or higher if possible in practice

-- CPI increase kept at around 3 percent

-- Over 11 million new urban jobs, and a registered urban unemployment rate within 4.5 percent

-- A steady rise in import and export volumes, and a basic balance in international payments

-- Increases in personal income basically in step with economic growth

-- A reduction of at least 3.4 percent in energy consumption per unit of GDP, and continued reductions in the release of major pollutants

The projected target for this year's growth is realistic and in keeping with economic principles; it will help steer and steady expectations and make structural adjustments; and it will help achieve the goal of finishing the building of a moderately prosperous society in all respects.

An important reason for stressing the need to maintain stable growth is to ensure employment and improve people's lives. As employment pressure grows this year, we will continue to give top priority to creating jobs and implement a more proactive employment policy. This year's target for urban job creation is one million more than last year, underlining the greater importance we are attaching to employment. Considering our sound economic fundamentals and the capacity they bring for job creation, with hard work, this target is attainable.

We will pursue a more proactive and effective fiscal policy. This year's deficit-to-GDP ratio is projected to be 3 percent, with the fiscal deficit set at 2.38 trillion yuan, representing a year-on-year increase of 200 billion yuan. To break this down, the projected deficit of the central government is 1.55 trillion yuan, and the projected deficit of local governments is 830 billion yuan. Local government special bonds to be issued will total 800 billion yuan, and local government bonds will continue to be issued to replace their outstanding debt. The main reason for keeping this year's deficit-to-GDP ratio unchanged is to allow for further reductions in taxes and fees. Over the course of the year, the tax burden on businesses will be further eased by around 350 billion yuan, and business related fees will be further cut by around 200 billion yuan to benefit market entities.

Government budgets should highlight priorities; spending in some areas should be maintained while in others cuts should be made; and more should be spent to strengthen areas of weakness and improve living standards. General transfer payments to local governments will be increased by 9.5 percent, with the focus on increasing transfer payments for equalizing access to basic public services and stepping up subsidies for regions facing economic difficulties. We will scale down non-priority spending and cut budgets for projects that do not deliver desired outcomes.

Governments at all levels should tighten their belts, and central government departments should take the lead by cutting no less than 5 percent of their general expenditures. No increase in spending on official overseas visits, official vehicles, or official hospitality is permitted; and we will squeeze out more funds to cover cuts in taxes and fees. We will keep government spending low and enrich our people.

To deliver a good performance this year, we in government should stick to the following guidelines:

First, we should make progress while maintaining stable performance and keep our strategic focus. Stability is of overriding importance. We should ensure stable growth, maintain employment, and prevent risks. To ensure overall economic and social stability we must not allow the redline to be crossed concerning financial security, people's wellbeing, or environmental protection. We should, while maintaining stable performance, endeavor to make progress, deepen reforms, accelerate structural adjustments, be prepared to take on some really tough problems, and push to make progress in key areas.

Second, we should focus on supply-side structural reform. We must give priority to improving supply-side structure. We should streamline administration, reduce taxes, further expand market access, and encourage innovation; and we should keep micro entities energized, reduce ineffective supply while expanding effective supply, and better adapt to and guide demand. Like the struggle from chrysalis to butterfly, this process of transformation and upgrading is filled with promise but also accompanied by great pain; it is urgent, formidable, and complicated. We should press forward with courage and get the job done.

Third, we should expand aggregate demand as appropriate and improve its efficacy. China's potential domestic demand is enormous, and it is both necessary and possible for domestic demand to be expanded. The key is to know where to start. We need to increase consumer spending to improve people's lives, and boost investment to strengthen areas of weakness and sustain development, so that the expansion of domestic demand becomes more effective and sustainable and supply-side reform and demand-side regulation reinforce each other.

Fourth, we should rely on innovation to replace old growth drivers with new ones and speed up structural improvement and upgrading. Having reached the current stage of development, China can now advance only through reform and innovation. We have the largest quality workforce as well as the largest pool of scientists, engineers, and professionals in the world, and their potential for innovation is truly tremendous. We must continue to draw strength from reform and opening up, fully tap the potential of human resources and human capital, and move more quickly to pursue innovation-driven development. We should foster and develop new growth drivers while transforming and upgrading the traditional growth drivers, and increase total factor productivity. These steps will enable China's economy to maintain a medium-high rate of growth and China's industries to move toward the medium-high end.

Fifth, we should solve prominent problems of public concern. All government work is for the people. We should keep in mind the fact that China remains in the primary stage of socialism and pursue a people focused development philosophy. Where conditions permit, we will lose no time in solving problems about which the people have great concern and which demand speedy resolution. When problems cannot be solved for the time being, we will work to resolve them over time. We must make dedicated efforts to deliver services to the people, resolve the difficulties they face, promote social equity and justice, and demonstrate that development does better people's lives.