Guangzhou officials have set an economic growth target of 10 percent this year, amid challenging markets both at home and abroad.
The target is lower than last year's 10.5 percent growth in GDP, which was the lowest rate for 22 years.
Officials at the annual session of the local people's congress, which will end on Wednesday, said the slower target rate reflected a shift in local government priorities towards economic quality and improving livelihoods.
"The global economic downturn has had a negative impact on Guangzhou's economic development in recent years," said Zeng Dexiong, a deputy to the local people's congress.
"The local government has realized that the traditional model cannot help the city meet such a high economic growth rate in years ahead."
In a government work report during the congress, Guangzhou's mayor Chen Jianhua said the city will focus on industrial upgrading and will push what he called a new urban development model.
"We will boost economic development by introducing large infrastructure investment projects," Chen said, including seven new metro lines and two more runways at the Baiyun International Airport, expected to start construction this year.
"We will focus on industrial upgrading to develop Guangzhou as an international trade and commercial center," he added.
Referring to Guangzhou's GDP during the first half of last year, which increased 7.8 percent, Wan Qingtao, a researcher with South China Urban Development Institute, agreed the local government needed to inaugurate large investment projects to sustain its development last year.
"It had to sell some land, and began construction of some large infrastructure projects during the second half of last year to expand its economy," Wan said.
Guangzhou's GDP was worth 1.35 trillion yuan ($216.9 billion) in 2012 while fiscal revenues increased only 11.1 percent, the lowest since 2008, to 108.8 billion yuan.
"Fiscal revenue grew slower than previous years. The city should find new ways of generating economic growth in years ahead," added Wan.
Under the current global economic climate, Wan said it will be hard for large cities, especially those heavily relying on foreign trade for their economic development, to meet previous levels of economic growth.
"Most cities cannot avoid negative impacts brought about by global economic slowdown.
"As a city traditionally reliant on foreign trade, Guangzhou should change its economic development model," Wan added.
He called for more emphasis to be given by local government to the education, culture and science sectors in an effort to bridge the gaps being left by failing foreign business.
"These should be the new drivers of the local economy.
"But it is not simply to build a museum or an education cluster. The key issue is to develop a cluster of cultural and educational businesses which can be nurtured, and help to create new projects which will boost local economic development," Wan said.
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