SHANGHAI, Mar. 21 (SMM) – New leadership transition was finalized and programs regarding State Council institutional reform and transformation of government functions were voted through during the National People's Congress (NPC, running from March 5 through 17) and the Chinese People's Political Consultative Conference (CPPCC, running from March 3 through 12). Members and representatives from the NPC and CPPCC made proposals for China’s economic development over the next five years.
NPC and CPPCC Sessions Unveil China’s Five-Year Development Blueprint
New energy, energy-saving and environmental protection, new urbanization and improving people’s well-being are the four major topics during the NPC and CPPCC sessions.
Premier Wen Warns of Growing Inflationary Pressure in 2013
During his government work report on March 5, 2013, Premier Wen warned of growing inflationary pressure in 2013 and emphasized that stabilizing prices has always been an important target of the central government’s macro control.
Policy: Nonferrous Metal Industry
NDRC Head Highlights Overcapacity in Emerging Industries
Zhang Ping, head of the National Development and Reform Commission (NDRC) said normal market competition features 80%-85% utilization of production capacity based on widely accepted international standards. However, capacity utilization in China’s iron & steel, cement and aluminum industries is a mere 70%-75%, and even lower for photovoltaic industry, which is less than 60%.
Policy: Property Sector
Minister of Housing and Urban-Rural Development: China’s Housing Control May Get Tougher
On March 1, 2013, China introduced five new measures to cool domestic housing markets. These measures include imposing a 20% individual income tax on sales of second-hand homes and restricting the number of houses purchased and loans for house buying. As such, the Shanghai and Shenzhen stock markets both tumbled. Jiang Weixin, Minister of Housing and Urban-Rural Development said the Chinese government must take more detailed issues into consideration such as protecting rigid demand of home buyers. Meanwhile, Mr Jiang said housing curbs may get even tougher in the future.
Policy: Green Economy
CDB Chairman: CBD to Rein in New Loans for Photovoltaic Enterprises
Chen Yuanzhou, Chairman of the China Development Bank (CDB) recently said its bank will strictly control new loans for photovoltaic enterprises to minimize risks. On the other hand, loans for local financing sector will remain stable.
Proposal: Downstream Industry
CPPCC Member Proposes Continuation of Rural Home Appliance Subsidy Program
Consumption is the biggest driver of economic growth, followed by investment and exports. Li Weihua, a NPPCC member, proposed that rural home appliance subsidy program should remain in place so as to stimulate consumption and promote economic development.
Former MIIT Minister: Tax Incentives for Automobile Purchase Should Be Cancelled
It is argued that tax incentives for automobile purchases should be blamed for current serious traffic jams in cities. Li Yi, former Minister of the Industry and Information Technology (MIIT) agrees with such point.