III. Major Tasks and Measures for Economic and Social Development in 2013

We need to work on the following ten areas to attain the objectives of economic and social development this year:

1. We will strengthen and improve macro-control.

1) We will continue to implement a proactive fiscal policy. We will improve the policy for structural tax reductions in the process of taxation reform, with the focus on pushing forward the pilot project for replacing business tax with VAT. We will exercise strict management of fiscal revenue and expenditures, continue to give priority to people's wellbeing and weak links in economic and social development work, and stringently control administrative expenses and other general expenditures. We will enhance management of local government debts, properly handle issues of debt repayment and additional funding for ongoing projects, and ensure normal operations of eligible local government financing platforms. The fiscal deficit for 2013 is projected to be 1.2 trillion yuan, an increase of 400 billion yuan over last year, and the deficit as a percentage of GDP will be about 2%.

2) We will continue to implement a prudent monetary policy. We will appropriately expand the aggregate financing for the economy, and maintain reasonable growth of money and credit and proper liquidity. We will optimize the credit structure; offer more financial support to agriculture, rural areas, farmers, small and micro businesses, strategic emerging industries, and national projects of key importance under construction or expansion; and effectively lower financing costs of development of the real economy. We will actively widen financing channels of enterprises, steadily increase their direct financing, and develop multilevel capital markets. We will strengthen oversight and control to ensure that systemic and regional financial risks are kept at a minimum. The balance of broad money supply (M2) is expected to increase by about 13% in 2013.

3) We will increase coordination and cooperation among fiscal, monetary, industrial, land, and environmental policies to build up a synergy of macro-control measures.

4) We will focus on regulating economic activities. We will improve the mechanism to coordinate coal production and transportation with demand, and build up emergency coal reserves at a faster pace. We will improve electricity generation and distribution, strengthen inter-provincial allocation of electricity, and carry out comprehensive pilot projects for demand-side management of electricity in cities. We will balance supply and demand of refined petroleum products, regulate their imports and exports accordingly, and quicken the building of emergency natural gas reserves. We will enhance overall transportation coordination and ensure transportation of key materials.