Top Planner Zeng Peiyan Holds Press Conference

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Last updated at: (Beijing Time) Friday, March 08, 2002

Top Planner Zeng Peiyan Holds Press Conference

Zeng Peiyan, minister in charge of the State Development Planning Commission, Thursday afternoon gives a press conference sponsored by the Fifth Session of the Ninth National People's Congress at the Great Hall of the People in Beijing. He will answer questions concerning the implementation of the plan of national economy and social development in 2001 and other important issues.

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China Confident of Achieving Economic Growth Target

China is confident of achieving its economic growth target --7 percent -- this year, said Zeng. China enjoys favorable conditions in investment and domestic consumption, he told the press conference.

The target is set by taking into full account the favorable conditions China faces, he said at a press conference held by the Fifth Session of the Ninth National People's Congress.

They include the planned issuance of another 150 billion yuan of treasury bonds this year, influx of foreign investment following China's accession to the World Trade Organization (WTO),and domestic consumption.

China will strive to maintain a relatively fast pace of growth. Otherwise, Zeng stressed, such problems as employment pressure, difficulty in enterprise operation and less fiscal revenue may arise.

"The target of 7-percent growth is achievable through our efforts," the minister said, adding that China's economy had a good start in the first two months of this year.

Foreign Investors Sign More Investment Agreements in Western China than in Eastern China

Foreign investors signed more investment agreements in western China than in eastern China in 2001, said the Chinese top planner.

He told the press conference that he was looking forward to seeing more foreign investors to invest in western China in the future and contribute more to the western China development drive.

The development planning minister said the western China development drive has so far brought about great changes in eco- environment protection, infrastructure construction and even in economic growth.

He noted that the fixed asset investment in the western part of the country grew 19.3 percent and that in the middle part grew 16. 3 percent in 2001, six and three percentage points, respectively, higher than in the eastern part of the country.

The growth of both GDP and fixed assets investment in the western part of the country was above the national average and the people enjoyed a high standards of living over the past two years, Zeng said.

Reform Plan for Power Sector

At Thursday's press conference for the Fifth Session of the Ninth National People's Congress, Zeng also unveiled the long-awaited reform plan for the power sector. This aims to break up the virtual monopoly of the State Power Corporation of China.

Zeng said the government plans to separate the electricity-generating and transmission assets of the corporation, which controls over half of China's power plants and almost all the power grids. Most of the company's generating assets will be injected into three or four new power-generation groups to let them compete across the nation.

The power-transmission assets of the State Power Corporation are expected to be split into five regional grid companies, in which the State Power Corporation will hold the controlling shares. Another independent grid company would be set up to cover the southern provinces.

Zeng said all the power plants should compete to transmit their electricity over power networks, and an independent committee would be set up to supervise the power sector.

"As for the current contracts with foreign companies, they could either keep their contracts unchanged or they could negotiate new ones,'' said Zeng.

To solve the electricity shortage in the 1980s, China promised each foreign investor in the domestic power sector a stable high profit return for 10 to 20 years.

WTO Entry Could be Painful for Less Efficient IndustriesZeng admitted that China's entry to the World Trade Organization could be painful for less efficient industries such as motor manufacturing and pharmaceuticals, and also lead to an increased oversupply of grain and further joblessness.

"We should provide favourable policies and systems to protect our industries and agriculture, as the WTO rules allow,'' said Zeng.

"Compared with other WTO members, our support for agriculture is much less. We are very much justified in lending more support,'' said Zeng.

He added that China will seek to expand exports and imports to keep foreign trade balanced.

"We would provide tax rebates for the exports of qualified companies, abolish additional fees on exports of grain and cotton, and perfect our examination system on imports,'' said Zeng.

He also said the commission is working in conjunction with the Hong Kong Special Administrative Region and the neighbouring Guangdong and Fujian provinces in South China, to avoid competition between them in finance, trade, tourism, and infrastructure construction.

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Summary of Zeng Peiyan's Report on Social, Economic Development Plan