Premier: China to Focus on Helping Poor

By CHARLES HUTZLER

BEIJING – Premier Wen Jiabao promised Monday to spend more on boosting incomes in China’s poor, restive countryside and protecting the environment as he announced budget plans for 2007.

The government also will maintain controls meant to contain a surge in housing prices, Wen said in a speech at the opening of the annual session of China’s legislature.

China’s leaders must “safeguard social fairness and justice and ensure that all of the people share in the fruits of reform and development,” Wen said.

Communist leaders face strains from a growing and politically volatile gap between an elite who have profited from China’s 25-year-old boom and the poor majority. Protests have erupted in rural areas throughout the country over land seizures for redevelopment.

Total spending by China’s central governments will rise 14.4 percent to $335 billion next year, Wen said.

The premier announced an economic growth target of 8 percent, well below last year’s expansion rate of 10.7 percent, amid efforts to avert a runaway expansion. The government usually issues a low growth target at the start of each year and raises it as economic expansion surges ahead.

In the countryside, spending on agriculture, schools, medical clinics and other programs will rise by 15 percent to $51 billion, Wen said.

“Agriculture, the base of the economy, remains weak, and it is now more difficult than ever to steadily increase grain production and keep rural incomes growing,” he said.

The government will promote environmental protection and energy efficiency by shutting down small power plants and antiquated facilities in the steel, cement and aluminum industries, he said.

Communist leaders are trying to improve energy efficiency to reduce both environmental damage and China’s reliance on imported oil, which they see as a strategic weakness.

China is one of the world’s biggest consumers of oil and coal, and uses several times as much energy per unit of economic output as the United States, Japan and other countries.

Wen gave no specifics of conservation efforts, but said the government will use market forces, pricing and taxes “to promote energy saving and environmental protection.”

The premier warned that China still faces strains from the financial imbalances caused by its surging trade surplus and excess liquidity in its financial system. But he announced no new trade initiatives.