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Chapter Nine ‖ Upholding and Developing Socialism with Chinese Characteristics Under New Conditions

Editorial Group of This Book

January 1, 2021

第九章 在新的形势下坚持和发展中国特色社会主义

本书编写组

Chapter Nine ‖ Upholding and Developing Socialism with Chinese Characteristics Under New Conditions第九章 在新的形势下坚持和发展中国特色社会主义

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Originally Written By
Editorial Group of This Book本书编写组
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CPC History Press中共党史出版社

Chapter Nine ‖ Upholding and Developing Socialism with Chinese Characteristics Under New Conditions

第九章 ‖ 在新的形势下坚持和发展中国特色社会主义

On December 5–6, 2002, Hu Jintao—newly elected General Secretary of the CPC Central Committee following the Party’s Sixteenth National Congress—led his colleagues from the Secretariat of the CPC Central Committee to Xibaipo in Pingshan County, Hebei Province, to study and review Mao Zedong’s important exposition on the “two musts.” Hu Jintao called on all party comrades, and especially leading cadres, to vigorously carry forward the spirit of hard work and plain living, to keep firmly in mind the Party’s purpose of serving the people wholeheartedly, and to ensure that power is exercised for the people, that one’s feelings are tied to the people, and that one’s efforts are directed toward the interests of the people. He urged the Party to acquit itself well in the examination of leading the people toward the goal of building a Moderately Prosperous Society in all respects and of unceasingly opening up new vistas for the cause of socialism with Chinese characteristics. The visit to Xibaipo gave expression to the aspirations and pursuits of Chinese Communists in the new century and at a new stage.

I. The Sixteenth National Congress of the Party, the Establishment of the “Three Represents” as the Party’s Guiding Thought, and the Program for Building a Moderately Prosperous Society in All Respects

The Sixteenth National Congress of the Party

From November 8 to 14, 2002, the Sixteenth National Congress of the Communist Party of China was held in Beijing. Jiang Zemin delivered a report entitled “Build a Moderately Prosperous Society in All Respects and Create a New Situation in Building Socialism with Chinese Characteristics.”

The Congress systematically summarized the thirteen years of struggle and the basic experience accumulated since the Fourth Plenary Session of the Thirteenth Central Committee. The report noted that these experiences, taken together with the historical experience accumulated since the Party’s founding, could be summed up as follows: our Party must always represent the development requirements of China’s advanced productive forces, always represent the forward direction of China’s advanced culture, and always represent the fundamental interests of the overwhelming majority of the Chinese people. The Congress set out requirements for comprehensively implementing the “Three Represents.”

The Congress put forward the goal of building a Moderately Prosperous Society in all respects. The Congress held that, through the joint efforts of the entire Party and the people of all ethnic groups across the country, we had successfully achieved the first and second steps of the “three-step” strategy for modernization, and that the people’s living standards had on the whole reached a moderately prosperous level. However, it was necessary to recognize that our state was in, and would remain for a long time in, the Initial Stage of Socialism; that the level of moderate prosperity then achieved was still low, incomplete, and highly uneven; and that the principal contradiction in our society remained the contradiction between the people’s ever-growing material and cultural needs and the backwardness of social production. Consolidating and raising the level of moderate prosperity already achieved would still require a prolonged period of arduous struggle. The Congress pointed out that the first two decades of the twenty-first century represented a Period of Strategic Opportunity that must be firmly grasped and that offered great promise. In the first two decades of this century, our state was to concentrate its efforts on building a higher-level Moderately Prosperous Society benefiting more than one billion people—one in which the economy would be more developed, democracy more sound, science and education more advanced, culture more flourishing, society more harmonious, and the people’s lives more prosperous. This was an indispensable transitional stage of development connecting the past to the future in realizing the third-step strategic goal of modernization, and also a critical stage for improving the socialist market economy system and expanding opening up. After completing this stage of construction, continued decades of struggle would lead to the basic realization of modernization by the middle of this century, transforming our state into a prosperous, strong, democratic, and culturally advanced socialist country. The Congress also set out goals for building a Moderately Prosperous Society in all respects across the economic, political, cultural, social, and ecological spheres, ▶ A Brief History of the Communist Party of China expanding the scope of applicants for Party membership to include advanced elements from other social strata; and adding provisions for establishing primary-level party organizations in communities, social organizations, and social intermediary organizations. The amendment to the Party Constitution also added a chapter on “the Party emblem and flag,” which plays an important role in bringing into play the inspirational power of the Party emblem and flag and in strengthening the Party’s cohesion and influence.

★ The venue of the Sixteenth National Congress of the Party

emphasizing that, on the basis of optimizing structure and improving efficiency, the gross domestic product should strive to quadruple from its 2000 level by 2020.

The Congress deliberated and adopted the report and the Amendment to the Constitution of the Communist Party of China. The amendment to the Party Constitution explicitly stipulated that the Communist Party of China is the vanguard of the Chinese working class, as well as the vanguard of the Chinese people and the Chinese nation; that it is the leadership core of the cause of socialism with Chinese characteristics; and that it represents the development requirements of China’s advanced productive forces, the forward direction of China’s advanced culture, and the fundamental interests of the overwhelming majority of the Chinese people. Articulating the Party’s nature in this way helps to mobilize the enthusiasm, initiative, and creativity of party members as broadly as possible, and to unite and lead the broad masses of the people in jointly building socialism with Chinese characteristics. The amendment added the requirement that the Party must act in accordance with the principle of taking charge of the overall landscape and coordinating all parties; added provisions on party groups playing the role of a leadership core; and clarified

The Congress elected the Sixteenth Central Committee and the Central Commission for Discipline Inspection. The First Plenary Session of the Sixteenth Central Committee elected Hu Jintao, Wu Bangguo, Wen Jiabao, Jia Qinglin, Zeng Qinghong, Huang Ju, Wu Guanzheng, Li Changchun, and Luo Gan as members of the Standing Committee of the Political Bureau, and elected Hu Jintao as General Secretary of the Central Committee; it decided that Jiang Zemin would serve as Chairman of the Central Military Commission; and it approved Wu Guanzheng as Secretary of the Central Commission for Discipline Inspection. In September 2004, the Fourth Plenary Session of the Sixteenth Central Committee decided that Hu Jintao would serve as Chairman of the Central Military Commission.

The Sixteenth National Congress of the Party was the first national congress convened by the Party in the new century. The Congress gave clear answers to the major questions of what banner the Communist Party of China should hold aloft, what road it should follow, and what development goals it should pursue in the new century and at a new stage. It proclaimed to the world that: in the new century and at a new stage, the banner held aloft by the Communist Party of China is the banner of Marxism-Leninism, Mao Zedong Thought, and Deng Xiaoping Theory, and the banner of the “Three Represents”; the road the Communist Party of China would follow is the road of socialism with Chinese characteristics; and the goal the Communist Party of China would lead the people to achieve in the first fifty years of the new century is the goal of building a Moderately Prosperous Society in all respects and then realizing modernization. From that point on, the Chinese people set out on a new journey of building a Moderately Prosperous Society in all respects.

Establishing the “Three Represents” as the Party’s Guiding Thought

One of the historic contributions of the Sixteenth National Congress was to enshrine the “Three Represents,” together with Marxism-Leninism, Mao Zedong Thought, and Deng Xiaoping Theory, in the Party Constitution as guiding thought that the Party must uphold over the long term.

The Sixteenth National Congress provided a comprehensive exposition of the scientific connotations and fundamental requirements of the “Three Represents.” The Congress emphasized that the “Three Represents” had been put forward on the basis of a scientific assessment of the Party’s historical position; that they represent an inheritance and development of Marxism-Leninism, Mao Zedong Thought, and Deng Xiaoping Theory; that they reflect the new demands placed on the work of the Party and the state by developments and changes in the contemporary world and in China; that they are a powerful theoretical weapon for strengthening and improving Party building and for advancing the self-improvement and development of the socialist system; and that they are the crystallization of the collective wisdom of the entire Party. The Congress pointed out that implementing the “Three Represents” requires, above all, upholding the spirit of keeping pace with the times; that its core lies in upholding the Party’s advanced nature; and that its essence lies in upholding the principle of governing for the people. Always embodying the “Three Represents” is the foundation of our Party’s existence, the bedrock of its governance, and the source of its strength. To this end, the entire Party must always maintain a spirit of keeping pace with the times and unceasingly open up new horizons in the development of Marxist theory; must treat development as the Party’s top priority in governing and rejuvenating the country and unceasingly open up new vistas in modernization; must mobilize all positive factors as broadly and fully as possible and unceasingly add new strength to the great rejuvenation of the Chinese nation; and must advance Party building with a spirit of reform and unceasingly inject new vitality into the Party’s organism.

Following the Sixteenth National Congress, the Party Central Committee took a series of measures to promote the study and implementation of the “Three Represents.” Regions and departments across the country earnestly fulfilled the requirements of the Center, continuously driving the study and implementation of the “Three Represents” to new heights, and powerfully advancing the development of all undertakings of the Party and the state.

II. Promoting the Scientific Development of Economy and Society

The Formulation of the Scientific Outlook on Development

Just as regions and departments across the country were vigorously advancing reform and opening up and all aspects of socialist modernization in pursuit of the goal of building a Moderately Prosperous Society in all respects set out by the Sixteenth National Congress, our state was struck by a sudden outbreak of atypical pneumonia (commonly known as SARS).

In the latter half of February 2003, the SARS epidemic spread in parts of Guangdong; in early March it spread and expanded into North China; and by late April it had reached 26 provinces, autonomous regions, and municipalities directly under the central government. The SARS epidemic posed a serious threat to the health and lives of the people and dealt a severe blow to economic and social development. The Party Central Committee and the State Council placed the health and lives of the people first, and promptly made the major decision to simultaneously maintain an unwavering grip on the great task of epidemic prevention and control while keeping economic construction as the central focus, and to unite as one to achieve a dual victory in fighting SARS and promoting development. Under the strong leadership of the Party Central Committee and the State Council, the people of all ethnic groups across the country vigorously carried forward the spirit of solidarity and unity, of mutual assistance and shared hardship, and of facing difficulties head-on with the courage to prevail. The entire nation mobilized urgently, upheld mass prevention and control, and worked together to overcome the crisis. The SARS epidemic was effectively brought under control, and the economy maintained relatively rapid growth. In June, the World Health Organization announced the lifting of its travel advisory for Beijing. Our state’s fight against SARS achieved a major phased victory.

The victory in fighting SARS fully demonstrated the great superiority of our state’s socialist system. At the same time, the outbreak and spread of SARS also exposed new contradictions and problems that had emerged in our state after a period of rapid economic growth—including insufficient coordination in development, lagging development of public health, and inadequate emergency response mechanisms. This further prompted the Party Central Committee to engage in deep reflection on China’s development challenges under new conditions. The major theoretical and practical question of “what kind of development to achieve and how to achieve it” was placed squarely before Chinese Communists by the course of history.

In late August and early September 2003, during an inspection tour of Jiangxi, Hu Jintao put forward the concept of the “Scientific Outlook on Development,” calling for the firm establishment of a scientific outlook on development encompassing coordinated, comprehensive, and sustainable development. In October, the Third Plenary Session of the Sixteenth Central Committee was the first ★ On May 12, 2003, Hu Jintao, who was conducting an inspection of rural SARS prevention and control work in Sichuan, visited the People’s Hospital of Fushun County in Zigong City to meet with medical workers. to advance the productive forces and production relations, the economic base and the superstructure in a coordinated manner, and to advance coordination across all aspects and dimensions of economic, political, and cultural construction. Sustainable development means promoting harmony between humanity and nature, achieving coordination between economic development and population, resources, and the environment, upholding the path of civilized development characterized by thriving production, prosperous lives, and sound ecology, and ensuring that development can be sustained from generation to generation.

party document to put forward the Scientific Outlook on Development in complete form, emphasizing “upholding a people-centered approach and establishing a comprehensive, coordinated, and sustainable outlook on development to promote the comprehensive development of the economy, society, and the individual.”

On March 10, 2004, Hu Jintao provided a comprehensive exposition of the scientific connotations, basic requirements, and guiding significance of the Scientific Outlook on Development at the Central Symposium on Population, Resources, and the Environment. He pointed out that upholding a people-centered approach means taking the comprehensive development of the individual as the goal, pursuing and promoting development from the standpoint of the fundamental interests of the people, unceasingly meeting the people’s ever-growing material and cultural needs, effectively safeguarding the people’s economic, political, and cultural rights and interests, and ensuring that the fruits of development benefit all the people. Comprehensive development means taking economic construction as the center, comprehensively advancing economic, political, and cultural construction, and achieving economic development and all-round social progress. Coordinated development means integrating our approach to urban and rural development, to regional development, to economic and social development, to the harmonious development of humanity and nature, and to domestic development and opening up, so as to

The Scientific Outlook on Development was a summary of the experience gained from more than twenty years of reform and opening up, an important lesson drawn from the victory over SARS, and an urgent requirement for advancing the building of a Moderately Prosperous Society in all respects. After it was put forward, the Scientific Outlook on Development was continuously enriched and refined through practice, and played an important guiding role in advancing the cause of socialism with Chinese characteristics.

Improving the Socialist Market Economy System and Promoting Sound and Rapid Economic Development

Through the struggles and explorations of the reform and opening up era—and especially since the Fourteenth National Congress—our state had initially established a socialist market economy system, which greatly promoted the development of the social productive forces. However, the socialist market economy system still had many imperfections and required further reform.

In October 2003, the Third Plenary Session of the Sixteenth Central Committee adopted the Decision of the CPC Central Committee on Several Issues Concerning the Improvement of the Socialist Market Economy System. This document proposed vigorously developing a mixed-ownership economy in which state capital, collective capital, and non-public capital hold shares; relaxing market access to allow non-public capital to enter infrastructure, public utilities, and other industries and sectors not prohibited by laws and regulations; establishing a modern property rights system with clear attribution, well-defined rights and responsibilities, strict protection, and smooth transfer; and establishing a system conducive to gradually changing the urban-rural dual economic structure, among other major policy measures. The Decision marked a further deepening of our Party’s understanding of developing a market economy under socialist conditions, and a further improvement in its capacity to grasp and apply the laws of the market economy. In accordance with the arrangements of the plenary session, economic system reform in our state steadily advanced into key areas and critical links.

Consolidating and developing the public-ownership economy and giving full play to the predominant role of the state-owned economy are important aspects of improving the basic economic system. State-owned Assets Supervision and Administration Commissions were successively established at the central, provincial, and municipal levels, changing the previous practice of government directly managing enterprises, so as to ensure that the responsibility for maintaining and increasing the value of state-owned assets was fulfilled. In accordance with the requirement put forward in the Decision that the joint-stock system should become the principal form of public ownership, state-owned enterprise shareholding reform was continuously advanced through various channels including standardized public listings, Sino-foreign joint ventures, cross-shareholding, and mergers and acquisitions. Following reform, a new generation of state-owned enterprises emerged that were capable of seizing market opportunities and meeting the challenges of international markets, becoming the backbone of the national economy, with the vitality, control, and influence of the state-owned economy significantly enhanced.

While resolutely consolidating and developing the public-ownership economy, the Party and government also resolutely encouraged, supported, and guided the healthy development of the non-public-ownership economy. In February 2005, the State Council issued several opinions on encouraging, supporting, and guiding the development of individual, private, and other non-public-ownership economic entities, proposing to relax market access for the non-public-ownership economy and to allow non-public capital to enter monopoly industries, public utilities, social services, financial services, and other sectors, and encouraging participation in the restructuring of state-owned enterprises. As the policy environment continued to improve, non-public enterprises developed rapidly. During this period, the output value they created exceeded half of the gross domestic product, the proportion of taxes they remitted to the state increased continuously, and they played an increasingly important role in promoting economic growth, expanding employment, and enlivening the market.

In the course of sustained and deepening reform, the Party and government took timely measures to strengthen macroeconomic regulation in response to problems that emerged during industrialization and urbanization, including excessively rapid growth in fixed-asset investment, excessive extension of monetary credit, and an excessively large trade surplus. After 2003, the Center proposed that the two sluice gates of land and credit must be firmly controlled,

with land and other resource policies serving as instruments of macroeconomic regulation. Because these measures were timely, the economy began to cool gradually from the second quarter of 2004, and the excessively rapid growth of investment in certain sectors was restrained to a certain degree.

While strengthening macroeconomic regulation, the Party Central Committee put forward new development guidelines in response to new developments in economic and social conditions. In October 2006, the Sixth Plenary Session of the Sixteenth Central Committee put forward the new requirement of “promoting sound and rapid economic development.” Sound and rapid development emphasized both maintaining steady and relatively rapid economic growth while preventing major fluctuations, and upholding the principle of seeking speed within soundness, with attention to optimizing structure and striving to improve quality and efficiency. The shift in the guideline for economic development from the long-used formulation of “rapid and sound” to “sound and rapid”—though merely a reordering of the two words—embodied the essential requirements of scientific development.

Through reform in key areas and critical links, effective implementation of macroeconomic regulation, and timely adjustment of guiding principles, the Party Central Committee alleviated some of the most prominent contradictions in economic operations. The national economy maintained a favorable trajectory of relatively rapid growth, improving structure, and rising efficiency, without major fluctuations. By 2007, our state’s total economic output had risen to fourth in the world, and the total value of imports and exports had risen to third in the world.

Proposing the Strategic Goal of Building a Socialist Harmonious Society

Achieving social harmony and building a better society is a goal for which our Party has striven unceasingly. Entering the new century, in the face of profound transformations in the economic system, profound changes in social structure, profound adjustments in the configuration of interests, and profound changes in ways of thinking, the Party Central Committee—proceeding from the overall landscape of the cause of socialism with Chinese characteristics and the broader configuration of building a Moderately Prosperous Society in all respects—accurately grasped the stage-specific characteristics of our state’s development, objectively analyzed the prominent contradictions and problems affecting social harmony, and put forward the major strategic goal of building a socialist harmonious society.

In November 2002, the Sixteenth National Congress, in expounding the goals for building a Moderately Prosperous Society in all respects, put forward the requirement of achieving a more harmonious society. In September 2004, the Fourth Plenary Session of the Sixteenth Central Committee explicitly put forward the major strategic task of building a socialist harmonious society, and identified improving the capacity to build a socialist harmonious society as an important component of strengthening the Party’s capacity to govern.

In October 2006, the Sixth Plenary Session of the Sixteenth Central Committee adopted the Decision of the CPC Central Committee on Several Major Issues Concerning the Building of a Socialist Harmonious Society, proposing to build a socialist harmonious society in accordance with the general requirements of democracy and the rule of law, fairness and justice, sincerity and fraternity, vitality, stability and order, and harmonious coexistence between humanity and nature. The Decision emphasized that it is essential to uphold a people-centered approach, always treating the fundamental interests of the overwhelming majority of the people as the starting point and ultimate goal of all the work of the Party and the state, ensuring that development is for the people, relies on the people, and that its fruits are shared by the people, and promoting the comprehensive development of the individual. The Decision also put forward policy measures for building a socialist harmonious society.

The formulation of the major strategic goal of building a socialist harmonious society added “social construction” as an important dimension to the overall landscape of the cause of socialism with Chinese characteristics, thereby expanding the layout from the “trinity” of economic construction, political construction, and cultural construction to the “four-in-one” layout of economic construction, political construction, cultural construction, and social construction.

Promoting Coordinated Regional and Urban-Rural Development

Uneven development between regions and between urban and rural areas is a prominent problem constraining our state’s economic and social development. After the Scientific Outlook on Development was put forward, the Party Central Committee earnestly implemented its requirements and made a series of major decisions and arrangements for integrating our approach to regional and urban-rural development.

Following the implementation of the Western Development Strategy at the turn of the century, and in accordance with the guideline put forward by the Center of prioritizing key projects and maintaining a degree of forward momentum, efforts were focused on strengthening infrastructure construction in the western region, with landmark engineering projects such as West-East Power Transmission, West-East Gas Pipeline, and the Qinghai-Tibet Railway launched as priorities. The Qinghai-Tibet Railway, known as “the railway closest to the sky,” was built by all its construction workers under harsh natural conditions, overcoming three world-class engineering challenges—perennial permafrost, high altitude and oxygen deficiency, and fragile ecology—to create the world’s highest-altitude and longest plateau railway, a miracle in the history of human railway construction. On July 1, 2006, the Qinghai-Tibet Railway, stretching 1,956 kilometers in total length, was opened to traffic along its entire route, ending the history of Tibet having no railway, powerfully driving the leapfrog development of the snow-covered plateau and improving the lives of people of all ethnic groups, and becoming an “oxygen supply line” for Tibet’s economic and social development. The deepening implementation of the Western Development Strategy continuously brought new developments to the economic and social progress of the western region.

While deepening the implementation of the Western Development Strategy, the Party Central Committee, with an eye toward achieving coordinated regional development, successively made major decisions to revitalize old industrial bases such as those in Northeast China and to promote the rise of the central region, thereby forming and enriching the overall strategy for regional development.

★ On the day the Qinghai-Tibet Railway opened, local residents at the approach to the Tuotuo River Bridge in Qinghai Province welcomed the “Qing No. 1” train departing from Golmud.Through the implementation of major industrial restructuring projects, the Northeast region saw significant improvements in the technological level of key enterprises such as Daqing Oilfield and China FAW Group, with independent innovation and advanced manufacturing capabilities continuously strengthened; and phased results were achieved in the pilot economic transformation of resource-based cities such as Fuxin in Liaoning. With support from the Center, the central region made every effort to achieve its rise, with a number of competitive advantaged industries and products continuously emerging, urban clusters, urban belts, and urban circles taking shape at an accelerating pace, and the locational advantage of connecting east and west becoming more prominent. The state approved the Shanghai Pudong New Area and the Tianjin Binhai New Area as national comprehensive reform pilot zones, and actively promoted the development and opening up of key areas such as the Yangtze River Delta and the west coast of the Taiwan Strait. The eastern region seized its locational and first-mover advantages to strive for leading development, with the three major metropolitan areas of the Yangtze River Delta, the Pearl River Delta, and the Beijing-Tianjin-Hebei region consistently maintaining their status as the “three major engines” of China’s economic development.

Integrating our approach to urban and rural development was another important task in promoting scientific development and advancing social harmony. The Fourth Plenary Session of the Sixteenth Central Committee conducted a thorough analysis of the industrialization process in certain countries and explicitly put forward the important thesis of “two tendencies”: “In the initial stage of industrialization, it is a universal tendency for agriculture to support industry and provide accumulation for industry; but after industrialization has reached a considerable level, it is also a universal tendency for industry to give back to agriculture and for cities to support the countryside, so as to achieve coordinated development of industry and agriculture, and of cities and the countryside.” The Center held that, after decades of development, our state had on the whole entered a stage of development in which industry promotes agriculture and cities drive the countryside; that it was essential to integrate our approach to urban and rural economic and social development, to treat the resolution of problems concerning agriculture, rural areas, and farmers as the top priority of all Party work, and to uphold the guideline of “giving more, taking less, and relaxing controls” in order to strive to increase farmers’ incomes. Beginning in 2004, the Center issued a “No. 1 Document” each year addressing the “three rural issues.” In October 2005, the Fifth Plenary Session of the Sixteenth Central Committee explicitly put forward the major strategic task of building a new socialist countryside and made arrangements for its construction.

The Party and government also took a series of major measures to genuinely reduce the burden on farmers.

On December 29, 2005, the Nineteenth Session of the Standing Committee of the Tenth National People’s Congress decided that, effective January 1, 2006, the Regulations of the People’s Republic of China on Agricultural Tax would be abolished. From that point on, the state would no longer levy a separate tax on agriculture, bringing to an end an ancient tax category that had existed in our state for 2,600 years. A series of local surcharges attached to the agricultural tax were also simultaneously abolished. The abolition of the agricultural tax and its various surcharges fundamentally reversed the situation of excessive burdens on farmers, bringing tangible and concrete benefits to hundreds of millions of farmers. Wang Sanni, a farmer from Qinglian Village in Lingshou County, Hebei Province, spent his own money to cast a “Farewell to the Land Tax Tripod,” expressing in this special way his joy at the abolition of the agricultural tax and ensuring that future generations would forever remember this historic measure.

The state also carried out comprehensive rural reforms encompassing township institutional reform, rural compulsory education, and county-township fiscal management system reform, as well as reform of the collective forest tenure system. In the great process of building a new socialist countryside, rural reform and development opened a new chapter.

Completion of the Tenth Five-Year Plan and Formulation of the Eleventh Five-Year Plan

At the turn of the century, some people in Western countries clamored about the so-called “China economic collapse theory.” However, the facts proved that the Chinese economy not only did not collapse, but became an important force in global economic development.

During the five years of the Tenth Five-Year Plan, our state shook off the impact of the Asian financial crisis, successfully overcame the SARS epidemic and major natural disasters, calmly responded to the new changes brought about by accession to the World Trade Organization, and seized the moment to advance reform and opening up while strengthening and improving macroeconomic regulation, maintaining steady and relatively rapid economic development, and lifting the social productive forces and composite national strength to a new level. Over the five years from 2001 to 2005, gross domestic product grew by 57.3%, with an average annual growth rate of 9.5%. The people’s lives improved markedly: ordinary people’s housing conditions improved greatly, automobiles rapidly entered ordinary households, tourism consumption increased substantially, and not only did domestic Golden Week holiday consumption flourish, but more and more people traveled abroad, with their footprints reaching all corners of the world.

During the Tenth Five-Year Plan period, our state’s per capita gross domestic product surpassed 1,000 US dollars, and economic and social development entered a critical period. With the completion of the Tenth Five-Year Plan, the Party Central Committee conducted in-depth research into and grasped a series of important stage-specific characteristics of our state’s development during this period, paid close attention to the challenges and risks that existed, and strove to overcome and address them through the formulation of the Eleventh Five-Year Plan.

In October 2005, the Fifth Plenary Session of the Sixteenth Central Committee adopted the Proposals of the CPC Central Committee for Formulating the Eleventh Five-Year Plan for National Economic and Social Development. A distinctive feature of the Proposals was the emphasis on upholding the Scientific Outlook on Development as the guide for the overall landscape of economic and social development, and on running the Scientific Outlook on Development throughout the entire process of reform, opening up, and modernization. The Proposals had two outstanding highlights: one was the emphasis that, on the basis of optimizing structure, improving efficiency, and reducing consumption, per capita gross domestic product in 2010 should double from its 2000 level—a higher target than the previously proposed goal of doubling gross domestic product; the other was the first-ever inclusion of energy consumption in the target system, with the proposal that energy consumption per unit of gross domestic product should be reduced by approximately 20% from the level at the end of the Tenth Five-Year Plan period. In March 2006, the Fourth Session of the Tenth National People’s Congress deliberated and adopted the Outline of the Eleventh Five-Year Plan for National Economic and Social Development of the People’s Republic of China.

The goals, tasks, and policy measures set out in the Eleventh Five-Year Plan outline were both aligned with the goals for building a Moderately Prosperous Society in all respects and reflective of the objective requirements and stage-specific characteristics of economic and social development. The Eleventh Five-Year Plan also, for the first time, changed the term “plan” (计划), which had been used for more than fifty years, to “program” (规划). This single-character difference reflected the functional positioning of medium- and long-term planning under socialist market economy conditions, and embodied major transformations in our state’s development philosophy, economic system, and government functions.

III. The Seventeenth National Congress of the Party and New Arrangements for Building a Moderately Prosperous Society in All Respects

The Seventeenth National Congress of the Party

From October 15 to 21, 2007, the Seventeenth National Congress of the Communist Party of China was held in Beijing. Hu Jintao delivered a report entitled “Hold High the Great Banner of Socialism with Chinese Characteristics and Strive for New Victories in Building a Moderately Prosperous Society in All Respects.”

The Congress provided a penetrating summary of the “ten combinations” of valuable experience from reform and opening up, expounded the basic connotations of the path of socialism with Chinese characteristics, and for the first time put forward and summarized the concept of the theoretical system of socialism with Chinese characteristics. The Congress emphasized that the fundamental reason for all the achievements and progress made since reform and opening up, when summed up, is this: we have blazed the path of socialism with Chinese characteristics and formed the theoretical system of socialism with Chinese characteristics. Holding high the great banner of socialism with Chinese characteristics means, above all, upholding the path of socialism with Chinese characteristics and the theoretical system of socialism with Chinese characteristics.

The Congress provided a comprehensive and systematic exposition of the historical background, scientific connotations, essential spirit, and fundamental requirements of the Scientific Outlook on Development.

The Congress conducted a thorough analysis of the developments and changes in the international and domestic situation and the series of new stage-specific characteristics of our state’s development in the new century and at a new stage, made comprehensive arrangements for achieving the grand goal of building a Moderately Prosperous Society in all respects, and put forward new requirements across five dimensions: economic, political, cultural, social, and ecological civilization. Compared with the goals set by the Sixteenth National Congress for the struggle through 2020, these new requirements were both aligned with those goals—maintaining continuity of objectives—and enriched them in light of new circumstances and conditions, making the goals for building a Moderately Prosperous Society in all respects ▶ A Brief History of the Communist Party of China more comprehensive, with richer connotations and more specific requirements; adding provisions on advancing anti-corruption work; adding the requirement that party cadres should establish a correct view of performance and produce results that can withstand the tests of practice, the people, and history; and adding new provisions on advancing intra-party transparency, developing intra-party democracy, and strengthening and improving the management of mobile party members.

★ The venue of the Seventeenth National Congress of the Party

more comprehensive, with richer connotations and more specific requirements. In particular, in light of the reality of sustained rapid economic development, the economic growth target set by the Sixteenth National Congress—striving to quadruple gross domestic product from its 2000 level by 2020—was adjusted, and the higher requirement of “achieving a doubling of per capita gross domestic product from its 2000 level by 2020” was put forward. These new requirements profoundly reflected new developments in the Party’s philosophy of governance and administration, and gave concentrated expression to the essential requirements and basic spirit of the Scientific Outlook on Development.

The Congress deliberated and adopted the report and the Amendment to the Constitution of the Communist Party of China. The amendment to the Party Constitution added content on the overall landscape of the cause of socialism with Chinese characteristics and on comprehensively advancing economic construction, political construction, cultural construction, and social construction, embodying the Party’s deepened understanding of the laws governing communist party governance, socialist construction, and human social development. In addition, provisions were added on the implementation of an inspection system by the central and provincial, autonomous region, and directly administered municipality-level committees of the Party, so as to strengthen intra-party oversight and advance anti-corruption work; provisions were added requiring party cadres to establish a correct view of performance and produce results that can withstand the tests of practice, the people, and history; and new provisions were added on advancing intra-party transparency, developing intra-party democracy, and strengthening and improving the management of mobile party members.

The Congress elected the Seventeenth Central Committee and the Central Commission for Discipline Inspection. The First Plenary Session of the Seventeenth Central Committee elected Hu Jintao, Wu Bangguo, Wen Jiabao, Jia Qinglin, Li Changchun, Xi Jinping, Li Keqiang, He Guoqiang, and Zhou Yongkang[1] as members of the Standing Committee of the Political Bureau, and elected Hu Jintao as General Secretary of the Central Committee; it decided that Hu Jintao would serve as Chairman of the Central Military Commission; and it approved He Guoqiang as Secretary of the Central Commission for Discipline Inspection.

The Formulation and Articulation of the Theoretical System of Socialism with Chinese Characteristics

The creative formulation and profound exposition of the theoretical achievement of the second historic leap in the Sinicization of Marxism—the theoretical system of socialism with Chinese characteristics—was a major theoretical contribution of the Seventeenth National Congress.

The theoretical system of socialism with Chinese characteristics was gradually formed in the great practice of the Party’s leadership of reform and opening up and socialist modernization. The Seventeenth National Congress was the first to summarize and articulate that the theoretical system of socialism with Chinese characteristics is a scientific theoretical system encompassing Deng Xiaoping Theory, the “Three Represents,” and major strategic thinking such as the Scientific Outlook on Development. This theoretical system upholds and develops Marxism-Leninism and Mao Zedong Thought; it embodies the wisdom and painstaking efforts of generations of Chinese Communists leading the people in tireless exploration and practice; it is the latest achievement in the Sinicization of Marxism; it is the Party’s most precious political and spiritual treasure; and it is the common ideological foundation for the united struggle of the people of all ethnic groups across the country. The Congress emphasized that the theoretical system of socialism with Chinese characteristics is an open and continuously developing theoretical system that must be cherished, upheld over the long term, and continuously developed.

The Congress pointed out that the Scientific Outlook on Development was put forward by drawing on the basic conditions of the Initial Stage of Socialism, summarizing our state’s development practice, drawing on foreign development experience, and responding to new development requirements. The primary task of the Scientific Outlook on Development is development; its core is a people-centered approach; its basic requirement is comprehensive, coordinated, and sustainable development; and its fundamental method is to integrate our approach to all aspects. To continue building a Moderately Prosperous Society in all respects and developing socialism with Chinese characteristics at a new stage of development, it is essential to uphold Deng Xiaoping Theory and the “Three Represents” as the guide and to thoroughly implement the Scientific Outlook on Development.

The Congress held that the Scientific Outlook on Development is a major innovative achievement of the theoretical system of socialism with Chinese characteristics, and decided to enshrine this achievement in the Party Constitution. The Party Constitution explicitly stipulates: the Scientific Outlook on Development is a scientific theory that both carries forward and keeps pace with the times in relation to Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory, and the “Three Represents”; it is an important guiding principle for our state’s economic and social development; and it is a major strategic thought that must be upheld and implemented in developing socialism with Chinese characteristics.

IV. Responding to Major Challenges and Deepening Reform and Opening Up

Responding to the International Financial Crisis and Various Challenges

The US subprime mortgage crisis that began in 2007 evolved by 2008 into a global financial crisis, rapidly spreading from the financial sector to the real economy and from the United States to the world’s major economies. The ferocity of its onset, the speed of its spread, and the depth of its impact were unprecedented since the Great Depression of the late 1920s and early 1930s. After the US subprime mortgage crisis erupted, the Party Central Committee closely monitored the development of the crisis—and especially the risks and shocks it might bring to our state’s economic development—and emphasized the need to maintain a sense of vigilance and to prepare contingency plans for responding to the crisis.

By September, the impact of the international financial crisis on our state intensified rapidly; economic growth showed a sharp decline in the fourth quarter; export trade faced serious difficulties; and employment pressure increased rapidly. The Party Central Committee and the State Council conducted a comprehensive analysis, made accurate judgments, and responded calmly, shifting the focus of macroeconomic regulation to preventing an excessively rapid decline in economic growth. They implemented proactive fiscal policies and moderately loose monetary policies, focused on expanding domestic demand—especially consumer demand—and formulated a comprehensive package of measures including large-scale increases in government investment, structural tax cuts, and the implementation of adjustment and revitalization plans for ten major industries.

Through arduous efforts, our state was the first in the world to achieve an economic recovery and upturn. From the second quarter of 2009, the economy reversed its decline and began to recover, with full-year growth of 9.2%. The facts proved that the guidelines, policies, and measures our state adopted in responding to the impact of the international financial crisis were on the whole effective. However, some of the economic stimulus policies adopted would require a period of digestion, and our state’s economic development still faced many prominent contradictions and problems. Fundamentally resolving the problem of stable and healthy economic development required steadfastly advancing and deepening reform.

On May 12, 2008, a magnitude 8.0 earthquake struck Wenchuan, Sichuan, causing 87,000 deaths, affecting more than 46.25 million people, and resulting in direct economic losses of more than 845.1 billion yuan. Under the leadership of the Party Central Committee, our state rapidly organized the fastest rescue response, the broadest mobilization, and the largest deployment of forces in history. The Party Central Committee upheld a people-centered approach and respect for science, made resolute decisions and responded calmly, and the people of the entire country shared in the hardship and worked together with one heart. The people’s soldiers risked their lives and charged to the front. The institutional advantage of concentrating strength to accomplish great tasks—one side in difficulty, all sides providing support—was brought into full play. In the course of this magnificent earthquake relief effort, countless people gave others the chance to live in the moment between life and death; parents used their arms to shield their children and preserve the space for life; teachers used their bodies to shield students from the threat of death; party cadres and officials stepped forward and charged ahead at critical moments and in times of peril. On the rubble of the earthquake, they composed one moving heroic song after another, fully demonstrating the great spirit of earthquake relief: solidarity and unity, indomitable perseverance, a people-centered approach, and respect for science.

After winning a major victory in the earthquake relief struggle, the Party and government rapidly formulated plans for post-disaster recovery and reconstruction in the affected areas, decided to complete the post-disaster recovery and reconstruction tasks within three years, and mobilized national forces to implement paired assistance. People of all ethnic groups across the country, compatriots in Hong Kong, Macao, and Taiwan, and overseas Chinese contributed in various ways to earthquake relief and post-disaster reconstruction. By the end of September 2010, the reconstruction tasks were essentially completed one year ahead of schedule; the infrastructure and the production and daily lives of the people in the affected areas had far surpassed pre-disaster levels, creating a human miracle of post-disaster reconstruction.

Between 2008 and 2010, the Party and government also led the people to victory in combating and recovering from severe natural disasters including extreme freezing rain and snow weather in southern China, the powerful earthquake in Yushu, Qinghai, and the catastrophic flash flood and mudslide in Zhouqu, Gansu. The serious violent criminal incidents of smashing, looting, and arson in Lhasa and other places on March 14, 2008, and in Ürümqi on July 5, 2009, were lawfully and resolutely suppressed and properly handled; the destructive activities of violent terrorist forces, separatist forces, and religious extremist forces were resolutely struck down; and ethnic unity and social stability were maintained.

Successfully responding to various difficulties, risks, and challenges fully demonstrated our Party’s capacity to withstand all manner of risks and to navigate all manner of complex situations; demonstrated the political advantages of the Party’s strong leadership and our state’s socialist system in concentrating strength to accomplish great tasks; and demonstrated the dauntless spirit of “no difficulty can defeat the heroic Chinese people.”

Accelerating the Transformation of the Mode of Economic Development and Deepening Reform in Key Areas

Accelerating the transformation of the mode of economic development was a profound transformation in our state’s economic sphere. To better resolve the structural contradictions that had accumulated over a long period in the economy and the problem of an extensive mode of economic growth, the Seventeenth National Congress put forward the strategic task of accelerating the transformation of the mode of economic development. Changing the long-used formulation of “transforming the mode of economic growth” to “transforming the mode of economic development”—though only a two-character change—carried profoundly deep connotations. Transforming the mode of economic development, in addition to encompassing all the content of transforming the mode of economic growth, also put forward new and higher requirements regarding the philosophy, purpose, strategy, and approach of economic development, fully embodying the Party’s deepened understanding of the laws of economic development.

The impact of the international financial crisis further highlighted the problems of imbalance between domestic and external demand, lack of coordination between investment and consumption, irrational industrial structure, and an unsustainable mode of development. The Fifth Plenary Session of the Seventeenth Central Committee, convened in October 2010, clearly pointed out that accelerating the transformation of the mode of economic development was the main thread of economic and social development work during the Twelfth Five-Year Plan period. The Party Central Committee also made a new summary of the basic requirements for accelerating the transformation of the mode of economic development, clearly requiring that strategic adjustment of the economic structure be taken as the main direction of attack; that scientific and technological progress and innovation be taken as an important support; that safeguarding and improving people’s livelihoods be taken as the fundamental starting point and ultimate goal; that building a resource-conserving and environmentally friendly society be taken as an important focus; and that reform and opening up be taken as a powerful driving force. In accordance with these requirements, the Party and state successively adopted a series of measures: upholding the strategy of expanding domestic demand, upholding the path of new industrialization with Chinese characteristics, solidly advancing energy conservation, emissions reduction, and ecological and environmental protection, deepening the implementation of the overall strategy for regional development, steadily and prudently advancing urbanization, and driving the transformation of the mode of economic development forward with new steps.

The lag in transforming the mode of economic development was caused by multiple factors, but the greatest bottleneck lay in irrational institutional mechanisms. To this end, the Party Central Committee emphasized the need to continuously deepen reform so as to both give better institutional play to the market’s fundamental role in resource allocation and to form a system of macroeconomic regulation conducive to scientific development, thereby providing powerful momentum and institutional guarantees for economic and social development.

In the area of ownership system reform, the strategic adjustment of the state-owned economy and the reform of large state-owned enterprises accelerated. Beginning in 2006, central enterprises intensified mergers and restructuring; by 2011, the number of central enterprises under the supervision of the State-owned Assets Supervision and Administration Commission had decreased from 159 in 2007 to 117, with more than 80% of assets concentrated in key sectors such as petroleum and petrochemicals, electric power, national defense, and communications, as well as in pillar industries such as transportation, mining, and metallurgy, significantly enhancing the overall quality and competitiveness of state-owned enterprises. While making state-owned enterprises stronger and better, the Party and government upheld the guideline of “two unwaverings,” actively encouraging and guiding the healthy development of the non-public-ownership economy. In May 2010, the State Council issued several opinions on encouraging and guiding the healthy development of private investment, further improving the institutional environment for the development of the non-public-ownership economy.

In the area of rural reform and development, the Center made a clear announcement on the thirtieth anniversary of reform and opening up that the existing land contract relationships would remain stable and unchanged over the long term. The Third Plenary Session of the Seventeenth Central Committee, convened in October 2008, adopted the Decision of the CPC Central Committee on Several Major Issues Concerning the Advancement of Rural Reform and Development, emphasizing that agriculture is a strategic industry that stabilizes the country and reassures the people, requiring that the red line of 1.8 billion mu of arable land be resolutely upheld, and promoting the integration of urban and rural economic and social development. Subsequently, the Center further increased fiscal investment in agriculture and introduced a series of policies to strengthen agriculture, benefit farmers, and enrich farmers; building on the implementation of direct grain subsidies, subsidies for superior seed varieties, agricultural machinery purchase subsidies, and comprehensive agricultural input subsidies were provided to grain-growing farmers, fully mobilizing the enthusiasm of grain-growing farmers. Beginning in 2004, our state’s grain output achieved eight consecutive years of growth, reaching 570 million tons in 2011. Farmers’ per capita net income also increased year after year.

In the area of expanding opening up, the level of the open economy improved comprehensively. China fulfilled its commitments upon accession to the World Trade Organization, substantially reducing tariffs; by 2010, the overall tariff level had fallen to 9.8%, far below the average level of developing countries. At the same time, large-scale work was carried out to review and revise laws and regulations. Beginning in 2001, over ten years the central government reviewed and revised more than 2,300 laws, regulations, and departmental rules, while local governments reviewed and revised more than 190,000 local policies and regulations. After the international financial crisis erupted, China actively responded to the sharp changes in the external environment, promptly introduced policy measures to stabilize external demand, implemented a market diversification strategy, and made important progress in foreign trade, utilization of foreign investment, and outbound investment. Over the ten years from 2001 to 2011 following accession to the World Trade Organization, China’s global ranking in merchandise trade rose from sixth to second. China’s policy of equal, mutually beneficial, cooperative, and win-win opening up not only benefited 1.3 billion Chinese people, but also brought benefits to the people of all countries in the world, powerfully driving global economic development.

Completion of the Eleventh Five-Year Plan and Formulation of the Twelfth Five-Year Plan

During the Eleventh Five-Year Plan period, in the face of complex changes in the domestic and international environment and major risks and challenges, the Party Central Committee firmly grasped development as the top priority of governance and national rejuvenation, gave full play to the political advantages of the socialist system and the fundamental role of the market in resource allocation, accelerated the advancement of reform, opening up, and modernization, and brought about new historic changes in the face of the country.

The economy maintained steady and relatively rapid development, and the national economy reached a new level. During the Eleventh Five-Year Plan period, gross domestic product grew at an average annual rate of 11.3%; in 2010 it surpassed 40 trillion yuan, and the total economic output successively surpassed Germany and Japan, rising to second in the world, making our state the world’s second-largest economy after the United States. Urban residents’ per capita disposable income and rural residents’ per capita net income grew at average annual rates of 9.7% and 8.9% respectively, and the people’s lives improved markedly.

▶ A Brief History of the Communist Party of China

★ On September 27, 2008, astronaut Zhai Zhigang, carrying out an extravehicular activity mission on the Shenzhou VII crewed spaceflight, waved the Chinese national flag outside the spacecraft.

Rapid economic development required scientific and technological innovation to provide momentum, while at the same time creating conditions for scientific and technological progress. Following the proposal in 2005 to build an innovation-oriented country, the Center further put forward in 2012 the implementation of an innovation-driven development strategy. In accordance with this arrangement, the state increased investment in science and technology, organized the implementation of 16 major science and technology projects, a technological innovation program, ten major industry revitalization plans, and a strategic emerging industries development plan, achieving a series of major independent innovation results at the frontiers of important disciplines and in strategically contested fields, with crewed spaceflight, lunar exploration, supercomputers, and other areas achieving new major breakthroughs. Following the first crewed spaceflight of the Shenzhou V spacecraft in 2003, five years later the astronaut of the Shenzhou VII spacecraft successfully conducted China’s first spacewalk, achieving a major milestone of landmark significance in the development of our state’s space technology. In 2007, Chang’e 1 completed the first lunar orbit exploration. The dream of flight that the Chinese nation had cherished for thousands of years finally became reality. In August 2008, the Beijing-Tianjin intercity high-speed railway opened for operation, marking China’s entry into the high-speed rail era. In addition, major engineering projects such as the Three Gorges Water Conservancy Hub, the Qinghai-Tibet Railway, the South-to-North Water Diversion, West-East Power Transmission, and West-East Gas Pipeline reported one success after another, fully demonstrating the brilliant achievements of our state’s reform, opening up, and modernization.

During the Eleventh Five-Year Plan period, our state also successfully accomplished many major events. From August 8 to 24, 2008, the Twenty-Ninth Summer Olympic Games were held in Beijing, followed by the Thirteenth Paralympic Games. The Chinese sports delegation topped the gold medal tally at the Olympics and topped both the gold medal and overall medal tallies at the Paralympics, achieving a double harvest of athletic results and spiritual civilization. The Chinese people successfully hosted an Olympic Games that was distinctive and of a high standard, fulfilling the century-long aspiration of the Chinese nation, honoring the solemn commitment made to the international community, and further deepening mutual understanding and friendship with the people of all countries in the world. From May 1 to October 31, 2010, the World Exposition with the theme “Better City, Better Life” was held in Shanghai. This was the first registered World Expo held in a developing country. Over 184 days, 246 countries and international organizations participated, with 73.08 million visits, writing a new chapter in the exchange and mutual learning between the Chinese people and the people of all countries in the world.

Entering the second decade of the twenty-first century, the Party Central Committee conducted a comprehensive analysis of the international and domestic situation and put forward the important judgment that our state’s development during the Twelfth Five-Year Plan period remained in a Period of Strategic Opportunity offering great promise.

★ The venue of the Twenty-Ninth Summer Olympic Games

In October 2010, the Fifth Plenary Session of the Seventeenth Central Committee adopted the Proposals of the CPC Central Committee for Formulating the Twelfth Five-Year Plan for National Economic and Social Development, making comprehensive arrangements for continuing to advance toward the goal of building a Moderately Prosperous Society in all respects from a new historical starting point. A distinctive feature of the Proposals was the explicit statement that the theme of the Twelfth Five-Year Plan is scientific development and its main thread is accelerating the transformation of the mode of economic development. In March 2011, the Fourth Session of the Eleventh National People’s Congress approved the Outline of the Twelfth Five-Year Plan for National Economic and Social Development of the People’s Republic of China.

Steadily and Prudently Advancing the Building of Democracy and the Rule of Law

Entering the new century, in response to the demands of the times and the expectations of the people, the Party Central Committee upheld the integration of Party leadership, the people being masters of the country, and governance according to law, and upheld the path of political development of socialism with Chinese characteristics.

The building of the system of people’s congresses was further strengthened. In May 2005, the CPC Central Committee transmitted the Several Opinions of the Party Group of the Standing Committee of the National People’s Congress on Further Giving Play to the Role of NPC Deputies and Strengthening the Institutional Building of the Standing Committee of the National People’s Congress. In March 2010, the Third Session of the Eleventh National People’s Congress adopted the newly revised Electoral Law for the National People’s Congress and Local People’s Congresses at All Levels, which—against the backdrop of rapid economic and social development, the continuous advancement of urbanization, and major changes in the ratio of urban to rural population—clearly stipulated that NPC deputies would be elected on the basis of the same population ratio in both urban and rural areas. From the first half of 2011 to the end of 2012, the country completed the first round of county and township-level people’s congress elections following the revision of the Electoral Law, realizing “equal votes, equal rights” for urban and rural areas for the first time in the history of New China, and giving better expression to the principles of equality among individuals, equality among regions, and equality among ethnic groups. The pace of scientific and democratic legislation also accelerated further. By the end of 2010, the socialist legal system with Chinese characteristics—with the Constitution at its apex, with laws in multiple legal departments including constitutional-related law and civil and commercial law as its backbone, and with multiple levels of legal norms including laws, administrative regulations, and local regulations—was formed. This was an important milestone in the history of socialist democratic and legal system building in our state, and an important marker of the gradual maturation of the socialist system with Chinese characteristics.

The basic political system was further improved and developed. The Seventeenth National Congress was the first to incorporate the system of grassroots mass self-governance into the basic category of the political system of socialism with Chinese characteristics, advancing it as a foundational project for developing socialist democratic politics. Whether in cities or in the countryside, the practice of grassroots democratic elections, democratic decision-making, democratic management, and democratic oversight became increasingly broad and deep; hundreds of millions of people managed their own affairs in accordance with the law and enjoyed more and more substantive democratic rights; and the vitality of grassroots democracy was enhanced. By the end of 2012, rural areas had generally conducted eight or more rounds of village committee elections; more than 98% of village committees across the country had implemented direct elections, with an average voter participation rate of 95%; and cities had conducted six or more rounds of residents’ committee elections.

Promoting the Great Development and Flourishing of Socialist Culture

Building a culturally strong socialist country was a major strategic decision made by the Party upon entering the new century. The Seventeenth National Congress emphasized the need to promote the great development and flourishing of culture more consciously and actively, and to enhance the state’s cultural soft power. The Sixth Plenary Session of the Seventeenth Central Committee, convened in October 2011, adopted the Decision of the CPC Central Committee on Several Major Issues Concerning Deepening Cultural System Reform and Promoting the Great Development and Flourishing of Socialist Culture, putting forward the strategic task of upholding the path of socialist cultural development with Chinese characteristics and striving to build a culturally strong socialist country. Cultural construction in our state entered a new stage of development.

Building the socialist core value system was a major innovation in ideological and cultural construction. In March 2006, when Hu Jintao participated in a joint group discussion of members of the Democratic League and the China Association for Promoting Democracy at the Fourth Session of the Tenth Chinese People’s Political Consultative Conference, he put forward the need to foster a socialist sense of honor and disgrace. In October, the Sixth Plenary Session of the Sixteenth Central Committee put forward the task of building the socialist core value system. Subsequently, the building of the socialist core value system was integrated throughout the entire process of national education and the building of spiritual civilization; education in ideals and convictions, patriotism, national conditions, and the situation and policies was widely carried out across society, further strengthening the people’s conviction and confidence in the leadership of the Communist Party of China, the socialist system, the cause of reform and opening up, and the goal of building a Moderately Prosperous Society in all respects.

Achieving cultural prosperity and development urgently required establishing a cultural system compatible with the socialist market economy system. In December 2005, the CPC Central Committee and the State Council issued several opinions on deepening cultural system reform, clarifying that cultural system reform would focus on key links such as reshaping market entities, cultivating market systems, improving macro-management, and transforming government functions. By 2012, the transformation and restructuring of state-owned commercial publishing and distribution, film and television drama production, radio and television transmission, and other units was fully completed, and the reform of state-owned performing arts troupe systems was essentially completed.

In the course of cultural system reform, the state increased investment and reformed mechanisms, driving the building of the public cultural service system into the fast lane. A large number of cultural benefit-the-people projects were implemented, including the Cultural Information Resource Sharing Project, the Radio and Television Coverage of Every Village project, and the construction of township comprehensive cultural stations, basically achieving the goal of “every county having a library and cultural center, every township having a comprehensive cultural station.” At the same time, public museums, memorial halls, public libraries, art galleries, and cultural centers (stations) were actively opened free of charge, making the public welfare nature of public cultural facilities increasingly prominent.

Cultural system reform greatly stimulated the vitality of cultural innovation and creation; the rise and development of cultural industries became a prominent feature of cultural reform and development after entering the new century. Many cultural institutions that had previously “eaten from the public trough” were transformed through reform into market entities that operate independently, bear their own profits and losses, develop on their own, and exercise self-restraint, greatly improving our state’s capacity to supply cultural products. By 2012, the total output value of the national cultural industry exceeded 4 trillion yuan; the annual number of book titles published and total print runs steadily ranked first in the world; annual film output consistently remained above 500 films, making our state the world’s third-largest film producer; annual television drama production exceeded 10,000 episodes, making our state the world’s largest television drama producer; and emerging cultural industries such as cultural and creative industries, digital publishing, mobile multimedia, and animation and gaming developed rapidly.

Accelerating Social Construction with a Focus on Improving People’s Livelihoods

The people are participants in reform and also sharers in the fruits of development. Whether livelihood problems can be resolved well is not only related to social harmony and stability, but also to the hearts of the people and the consolidation of the Party’s governing foundation. During this period, the Party Central Committee—building on economic development and guided by the philosophy that development is for the people, relies on the people, and its fruits are shared by the people—focused on the issues of most immediate, direct, and practical concern to the people, worked to resolve the problem of economic and social development being “one leg long and one leg short,” accelerated social construction with a focus on improving people’s livelihoods, and strove to ensure that all the people have access to education, employment, medical care, old-age support, and housing.

Educational equity is an important foundation of social equity. Following the Sixteenth National Congress, the state substantially increased fiscal education expenditure, established a new mechanism for guaranteeing compulsory education funding in rural areas, fully exempted rural compulsory education students from miscellaneous fees, implemented the “two exemptions and one subsidy” policy in rural areas of the western region, further improved the national scholarship and grant system, and ensured that educational resources were prioritized toward rural, remote, ethnic minority, and impoverished areas, striving to guarantee the people’s opportunity to receive a good education. By 2008, all miscellaneous fees for compulsory education in both urban and rural areas were exempted, benefiting 160 million students and reducing the economic burden on hundreds of millions of families, ensuring that all school-age children eligible for compulsory education could “attend school without paying fees.” The national school enrollment rate for school-age children that year reached 99.5%. The degree of popularization of higher education was further improved; in 2012, the gross enrollment rate for higher education exceeded 30%, providing more opportunities for students to receive higher education.

The Party and government upheld employment as the foundation of people’s livelihoods and made every effort to expand employment. At the same time, laws and regulations such as the Employment Promotion Law and the Labor Contract Law were promulgated and implemented, providing legal guarantees for resolving the problem of employment equality. After the international financial crisis erupted in 2008, our state’s employment situation came under new pressure. For a time, protecting employment became the top priority of governments at all levels from the Center to the localities. Localities implemented more proactive employment policies, helping college graduates find employment, opening up more employment channels for farmers, helping urban families in difficulty find employment, and at the same time encouraging entrepreneurship to drive employment. By the end of 2011, the number of employed persons in urban and rural areas across our state reached 760 million, maintaining overall stability in the employment situation.

Medical and health care is a major livelihood issue. Beginning in 2003, our state began implementing the new rural cooperative medical care system in parts of the western region; in 2006 it was extended nationwide; and by the end of 2008 it covered the entire country, with 814 million rural residents participating. This new rural cooperative medical care system—in which participation is voluntary, with a focus on pooling funds for serious illness while also covering minor illness, with individuals contributing a small portion and the state and local governments subsidizing the larger portion—was warmly welcomed by the broad masses of farmers.

Establishing and improving the social security system is an important goal of building a Moderately Prosperous Society in all respects. Following the Sixteenth National Congress, the Party Central Committee upheld the guideline of broad coverage, basic protection, multiple levels, and sustainability, with a focus on basic old-age insurance, basic medical insurance, and the minimum living standard guarantee system, and accelerated the establishment of a social security system covering both urban and rural residents and commensurate with the level of economic development. In rural areas, a series of major institutional arrangements were successively introduced, including the new rural cooperative medical care system, the rural minimum living standard guarantee, and rural old-age insurance; in urban areas, the scope of social security coverage was continuously expanded from urban employees to urban residents, and especially to employees of non-public enterprises, flexibly employed persons, and migrant workers. By 2012, the number of persons enrolled in various old-age insurance schemes across our state reached 790 million, and the urban and rural basic old-age insurance system was fully established; the number of persons enrolled in various medical insurance schemes exceeded 1.3 billion, and universal medical insurance was basically achieved; the minimum living standard guarantee system achieved full coverage, and the urban and rural social assistance system was basically established. The world’s largest social security net in terms of population covered was essentially built.

As reform and development entered a critical period, social contradictions in our state became more frequent. The Party and governments at all levels actively explored new approaches and new measures for improving social management and services under new conditions, initially forming a social management landscape of Party committee leadership, government responsibility, social coordination, and public participation, and striving to resolve contradictions at the grassroots level and in their early stages. At the same time, active exploration was undertaken to establish and improve emergency management systems, further enhancing the capacity and level of response to and handling of sudden public emergencies. In the course of profound economic and social transformation and rapid transition, by strengthening social management and service work, our state consistently maintained social and political stability.

Strengthening Environmental Protection

Entering the twenty-first century, our state’s development faced increasingly prominent resource and environmental constraints, and the people’s demands for resolving ecological and environmental problems became increasingly urgent. In accordance with the requirements for accelerating the building of a resource-conserving and environmentally friendly society, the Center and localities took measures to drive environmental protection work in our state into a new stage of development.

Environmental protection was continuously strengthened. Our state formulated or revised laws including the Cleaner Production Promotion Law, the Circular Economy Promotion Law, and the Water Pollution Prevention and Control Law, and was the first developing country to formulate and implement a national plan for addressing climate change. The Eleventh Five-Year Plan also explicitly stipulated binding targets including reducing energy consumption per unit of gross domestic product by approximately 20% from the level at the end of the Tenth Five-Year Plan period, reducing total emissions of major pollutants by 10%, and increasing forest coverage to 20%. From the Center to the localities, the pursuit of green GDP began to replace the previous practice of pursuing GDP alone.

The Party and government attached importance to energy conservation and emissions reduction, focusing on the steel, non-ferrous metals, chemicals, and building materials industries, and lawfully phasing out a large number of backward production capacities such as small thermal power plants and small coal mines. At the same time, the Huai River, Taihu Lake, and other bodies of water were designated as key watershed areas, with water pollution control engineering construction carried out intensively, so as to allow rivers and lakes overburdened by pollution to recuperate and recover. In 2011, among the 189,000 kilometers of rivers evaluated nationwide, the proportion of river length with Class I–III water quality was 64.2%; the urban sewage treatment rate reached 83.6%.

Persistently advancing the Grain for Green program was a major decision made by the Party Central Committee and the State Council to address serious soil erosion and frequent river flooding. By 2008, the country had arranged Grain for Green tasks covering more than 400 million mu, equivalent to recreating the state-owned forest area of Northeast China and Inner Mongolia. In addition, our state continuously implemented a series of key ecological and environmental protection projects, including the ecological protection and construction project for the Three-River-Source Nature Reserve in Qinghai, the Beijing-Tianjin sandstorm source control project, and the rocky desertification comprehensive control project. By 2013, the national forest coverage rate had reached 21.63%, and desertified land had undergone a historic transformation from “sand advancing, people retreating” to “people advancing, sand retreating.”

Through unremitting efforts, the trend of worsening environmental pollution and ecological damage in our state was somewhat slowed, and environmental protection became a concrete and practical action.

V. Fulfilling the Historic Mission of the Military in the New Century and at a New Stage

In December 2004, Hu Jintao put forward new requirements for the military’s historic mission at an enlarged meeting of the Central Military Commission, pointing out that the military must provide an important force guarantee for the Communist Party of China to consolidate its governing position, provide a strong security guarantee for safeguarding the important Period of Strategic Opportunity for our state’s development, provide powerful strategic support for safeguarding state interests, and play an important role in safeguarding world peace and promoting common development. In April 2005,

★ On October 1, 2009, Hu Jintao reviewed the People’s Liberation Army honor guard at the celebration of the sixtieth anniversary of the founding of the People’s Republic of China.

Hu Jintao explicitly put forward the need to uphold the implementation of the Scientific Outlook on Development in national defense and military building, to promote the comprehensive, coordinated, and sustainable development of national defense and military building, and to achieve the unity of a prosperous country and a strong military. In December, Hu Jintao provided a systematic exposition of implementing the Scientific Outlook on Development in national defense and military building.

Military building upheld the principle of placing ideological and political building in the foremost position. In October 2006, Hu Jintao put forward the requirement of building a revolutionary military that obeys the Party’s command, serves the people, and is courageous in battle. In December 2008, Hu Jintao put forward the core values of the contemporary revolutionary soldier—”loyalty to the Party, love for the people, dedication to the state, devotion to the mission, and reverence for honor”—at an enlarged meeting of the Central Military Commission. The entire military vigorously cultivated the core values of the contemporary revolutionary soldier and carried out in-depth education on the historic mission, ideals and convictions, the fighting spirit, and the socialist sense of honor and disgrace, continuously enhancing the creativity, cohesion, and combat effectiveness of party organizations at all levels in the military. The entire military produced a number of advanced collectives and individuals, including the collective of crewed spaceflight heroes.

The entire military upheld military struggle preparedness as the leading force driving military modernization. As the role of informatization in modern warfare became increasingly prominent, in 2004 the Central Military Commission enriched and refined the military strategic guideline for the new period, putting forward the requirement that the basis of military struggle preparedness be placed on winning local wars under informatized conditions. In response to the requirements of military transformation with Chinese characteristics, the Center carried out adjustments and reforms to the military’s organizational structure and establishment. From 2003 to 2005, the People’s Liberation Army reduced its personnel by 200,000, with a focus on streamlining ground force units, while at the same time strengthening the strategic management functions of the Central Military Commission’s general departments, advancing the building of new operational capabilities, and driving the composition of combat forces toward a lean, joint, multi-capable, and highly efficient direction. The pace of the military’s comprehensive building of modern logistics also continuously accelerated; on the basis of achieving tri-service joint logistics, a support system, support methods, support means, and management model meeting the requirements of local wars under informatized conditions were gradually formed. The military also accelerated the implementation of the talent strategy project, continuously improving the informatization literacy of all officers and soldiers and continuously optimizing the structure of the talent pool.

Centered on building an informatized military and winning informatized wars, the transformation of the mode of combat power generation was accelerated. The military actively advanced the transformation of military training under mechanized conditions to military training under informatized conditions, and successfully organized a series of major joint campaign and tactical training exercises. Efforts were intensified to enhance the independent innovation capacity of national defense science and technology and weapons and equipment, and to vigorously develop modern weapons and equipment supported by military information systems; a weapons and equipment system with the second generation as the main body and the third generation as the backbone was essentially completed, laying a solid material foundation for the transformation of combat power. In September 2012, our state’s first aircraft carrier, the Liaoning, was officially delivered to the Navy.

The entire military and the People’s Armed Police also excellently completed a series of urgent, difficult, dangerous, and arduous tasks. They actively participated in emergency rescue and disaster relief operations for SARS, the severe freezing rain and snow disaster in southern China, the Wenchuan and Yushu earthquakes, and the catastrophic flash flood and mudslide in Zhouqu; participated in the evacuation of Chinese nationals from Libya; and through concrete actions upheld the title of “the people’s soldiers.” The Chinese military also actively participated in joint military exercises with multiple countries, United Nations peacekeeping operations, and escort missions in the Gulf of Aden and Somali waters, fully demonstrating excellent military qualities and the image of a powerful, civilized, and peace-loving military.

VI. Advancing the Practice of “One Country, Two Systems” and the Great Cause of the Peaceful Reunification of the Motherland

Advancing the Practice of “One Country, Two Systems”

Entering the new century, the central government continued to steadfastly implement the guidelines of “one country, two systems,” “Hong Kong people governing Hong Kong,” “Macao people governing Macao,” and a high degree of autonomy; acted strictly in accordance with the Constitution and the basic laws of the special administrative regions; and gave full support to the economic and social development of Hong Kong and Macao.

Following reunification, the democratic political system of the Hong Kong Special Administrative Region was advanced in accordance with the law. The Standing Committee of the National People’s Congress exercised the powers conferred by the Constitution and the Hong Kong Basic Law, and successively in 1999, 2004, 2005, and 2011 issued interpretations of relevant provisions of the Hong Kong Basic Law and its annexes. In accordance with the Basic Law and the relevant interpretations of the Standing Committee of the National People’s Congress, in December 2007 the Thirty-First Session of the Standing Committee of the Tenth National People’s Congress decided that the specific methods for selecting the fourth Chief Executive of the Hong Kong Special Administrative Region and forming the fifth Legislative Council in 2012 could be appropriately modified; that the election of the fifth Chief Executive of the Hong Kong Special Administrative Region in 2017 could be implemented by the method of universal suffrage; and that after the Chief Executive is elected by universal suffrage, the election of the Legislative Council of the Hong Kong Special Administrative Region could be implemented by the method of all members being elected by universal suffrage.

The democratic political system of the Macao Special Administrative Region also advanced in accordance with the provisions of the Basic Law. In December 2011, the Twenty-Fourth Session of the Standing Committee of the Eleventh National People’s Congress issued an interpretation of Article 7 of Annex I and Article 3 of Annex II of the Macao Basic Law, clarifying the procedures for amending the methods for selecting the Chief Executive and forming the Legislative Assembly of the Macao Special Administrative Region.

After entering the new century, the central government promptly adopted a series of policy measures—including opening up individual travel to Hong Kong and Macao for residents of some mainland cities, expanding Hong Kong’s renminbi business, and promoting the listing of mainland enterprises in Hong Kong—injecting a “shot in the arm” to help Hong Kong and Macao emerge from the Asian financial crisis, shake off the impact of SARS, and restore economic growth. Beginning in 2003, the mainland signed Closer Economic Partnership Arrangements (CEPA) and their supplementary agreements with Hong Kong and Macao respectively, eliminating institutional barriers between Hong Kong and Macao and the mainland in trade, investment, and other areas, continuously promoting the liberalization of goods and services trade and the facilitation of investment between the mainland and Hong Kong and Macao, and achieving mutual benefit and win-win outcomes for both sides. After the international financial crisis erupted, the central government introduced a series of policy measures providing a strong backstop for Hong Kong in responding to the international financial crisis. The central government also increased support for Macao’s economic development and appropriate diversification, supported Macao in building a world tourism and leisure center, approved the construction of a new campus for the University of Macao on Hengqin Island in Zhuhai, and supported the Macao Special Administrative Region in developing economic and trade relations with Portuguese-speaking countries.

With strong support from the central government, cooperation between the mainland and Hong Kong and Macao was continuously strengthened, with cooperation mechanisms established for Guangdong-Hong Kong, Guangdong-Macao, Beijing-Hong Kong, Shanghai-Hong Kong, and the nine provinces and regions of the Pan-Pearl River Delta, continuously expanding the development space for Hong Kong and Macao. As a key focus of Guangdong-Hong Kong-Macao cooperation, the central government also actively promoted the cooperative development of Shenzhen Qianhai, Zhuhai Hengqin, and Guangzhou Nansha. The economies of Hong Kong and Macao achieved relatively rapid development. In 2011, Hong Kong’s GDP grew by 54% compared with 1996, the year before reunification; Macao’s GDP more than quadrupled compared with 2000, with an average annual growth rate of 12.5%. Hong Kong and Macao maintained social stability and achieved greater economic prosperity, demonstrating the powerful vitality of the “one country, two systems” guideline.

In July 2012, Hu Jintao pointed out at the meeting celebrating the fifteenth anniversary of Hong Kong’s return to the motherland that “one country, two systems” is the best institutional arrangement for Hong Kong to maintain long-term prosperity and stability after its return. It is essential to uphold a comprehensive understanding and implementation of the “one country, two systems” guideline,

to act strictly in accordance with the Basic Law, and to organically combine upholding the “one country” principle with respecting the differences of “two systems,” maintaining the authority of the Center with safeguarding the high degree of autonomy of the special administrative regions, safeguarding the overall interests of the state with protecting the interests of all sectors of Hong Kong society, and supporting Hong Kong in actively conducting external exchanges with opposing interference in Hong Kong affairs by external forces—none of these can be neglected at any time.

Promoting the Peaceful Development of Cross-Strait Relations

While resolutely safeguarding the stability and prosperity of Hong Kong and Macao, the Party Central Committee steadfastly advanced the great cause of the peaceful reunification of the motherland in accordance with the guideline of “peaceful reunification, one country, two systems.”

Entering the new century, “Taiwan independence” separatist activities intensified continuously. The Chen Shui-bian authorities in Taiwan plotted to use so-called “constitutional reform” to separate Taiwan from China in the form of a so-called “constitution” and “laws,” seriously affecting the peaceful and stable development of cross-strait relations. The Party Central Committee placed opposing and containing “Taiwan independence” in a more prominent position in work related to Taiwan. On March 4, 2005, Hu Jintao put forward four points on developing cross-strait relations, emphasizing: the commitment to the one-China principle will never waver; the effort to seek peaceful reunification will never be abandoned; the guideline of placing hopes on the people of Taiwan will never change; and opposition to “Taiwan independence” separatist activities will never be compromised. These four “nevers” had a major impact on both sides of the Taiwan Strait and in the international community. On March 14, the Third Session of the Tenth National People’s Congress adopted the Anti-Secession Law by a large majority, emphasizing that if “Taiwan independence” separatist forces cause, under any name or by any means, the fact of Taiwan’s secession from China, or if major incidents entailing Taiwan’s secession from China occur, or if possibilities for peaceful reunification are completely exhausted, the state may employ non-peaceful means and other necessary measures to protect state sovereignty and territorial integrity. This fully demonstrated the common will and firm determination of the entire Chinese people to oppose “Taiwan independence” and safeguard national unity and territorial integrity. Taiwan policy thereby entered a new stage of “using law to contain independence and using law to promote reunification.”

At the same time, the CPC Central Committee actively promoted cross-strait party exchanges. On April 29, 2005, CPC Central Committee General Secretary Hu Jintao met with Kuomintang Chairman Lien Chan in Beijing, achieving the first historic handshake between the principal leaders of the Communist Party of China and the Kuomintang in sixty years. Following the meeting, the Joint Vision for Cross-Strait Peaceful Development was issued, and the two parties reached a series of consensuses. In April 2006, the Communist Party of China and the Kuomintang jointly held the first Cross-Strait Economic and Trade Forum; in October, they jointly held the Cross-Strait Agricultural Cooperation Forum. Through these forum platforms, the mainland side introduced multiple policy measures to promote cross-strait exchange and cooperation and to benefit Taiwan compatriots, advancing the development of cross-strait relations.

In March 2008, the Democratic Progressive Party, which stubbornly upheld the “Taiwan independence” position, left office, and the Kuomintang returned to power, bringing positive changes to the situation in Taiwan. On December 31, Hu Jintao comprehensively and systematically expounded the important thinking on the peaceful development of cross-strait relations at a symposium commemorating the thirtieth anniversary of the publication of the Message to Compatriots in Taiwan, putting forward six propositions for promoting the peaceful development of cross-strait relations, pointing out that promoting the peaceful development of cross-strait relations is the only path to achieving peaceful reunification, and providing important guidance for further advancing the development of cross-strait relations.

Both sides of the Strait, in the spirit of “building mutual trust, setting aside disputes, seeking common ground, and creating win-win outcomes,” jointly committed to improving and developing cross-strait relations. In June 2008, the Association for Relations Across the Taiwan Straits and Taiwan’s Straits Exchange Foundation resumed institutionalized consultations on the basis of the “1992 Consensus.” In December, direct sea and air links and direct postal services across the Strait were formally launched, marking a historic step toward full, direct, and two-way “three links” across the Strait. In June 2010, the signing of the Cross-Strait Economic Cooperation Framework Agreement advanced the process of institutionalizing and systematizing cross-strait economic cooperation.

As cross-strait economic and trade relations gradually moved toward normalization, cross-strait exchanges in academia, culture, education, journalism, sports, religion, and other areas continued to deepen.

Beginning in 2009, the Straits Forum has been held annually. In June 2011, individual travel by mainland residents to Taiwan was officially launched. The Chinese government also properly handled Taiwan-related diplomatic issues such as Taiwan’s participation in the World Health Assembly and the APEC Leaders’ Informal Meeting, effectively safeguarded the legitimate rights and interests of Taiwan compatriots in handling matters involving overseas disputes and other affairs, and looked after the welfare of Taiwan compatriots. This series of measures not only won the welcome and praise of the people within Taiwan, but also consolidated the international community’s one-China landscape, adding positive factors to the peaceful development of cross-strait relations.

VII. Upholding Peace, Development, and Cooperation

Entering the new century, the Party Central Committee responded to the world’s trend toward peace, development, and cooperation, and consistently followed the path of peaceful development. On April 22, 2005, Hu Jintao put forward the proposition of promoting the building of a “harmonious world” at the Asia-Africa Summit in Jakarta. In October 2007, the report of the Seventeenth National Congress reaffirmed that “the people of all countries should join hands and work together to promote the building of a harmonious world of lasting peace and common prosperity,” and the diplomatic goal of building a harmonious world was for the first time reflected and confirmed in a party congress document. To promote the building of a harmonious world, China put forward the overall diplomatic layout of “major powers are the key, the periphery is the priority, developing countries are the foundation, and multilateral forums are an important stage,” and actively carried out fruitful diplomatic activities.

Major power relations maintained overall stability and development. In January 2011, Hu Jintao paid a state visit to the United States at the invitation of the US side; the two heads of state issued a China-US joint statement, reaching important consensus on building a cooperative partnership of mutual respect and mutual benefit. China and Russia resolved the historically outstanding boundary issue on the eastern section of the Sino-Russian border in 2008, and the strategic cooperative partnership continued to deepen. China and the European Union established a comprehensive strategic partnership in 2003, after which bilateral economic and trade cooperation developed rapidly, with the EU ▶ A Brief History of the Communist Party of China China and neighboring countries achieved high-level mutual visits and exchanges, advancing the process of regional cooperation. At China’s initiative, in 2007 the member states of the Shanghai Cooperation Organization concluded a long-term treaty of good-neighborliness, friendship, and cooperation. China and ASEAN signed the Declaration on the Conduct of Parties in the South China Sea in November 2002, laying a political foundation for relevant countries to carry out practical cooperation and joint development in the South China Sea. In January 2010, the “China-ASEAN Free Trade Area” was officially launched, benefiting nearly one-third of the world’s population.

★ On September 15, 2005, Hu Jintao delivered a speech entitled “Endeavoring to Build a Harmonious World of Lasting Peace and Common Prosperity” at the World Summit marking the sixtieth anniversary of the founding of the United Nations.

maintaining its position as China’s largest trading partner for eight consecutive years. Sino-Japanese relations developed amid twists and turns. In May 2008, Hu Jintao visited Japan, and the leaders of the two countries jointly issued the Joint Statement on Comprehensively Promoting a Strategic Relationship of Mutual Benefit. In September 2012, in response to the Japanese government’s so-called “nationalization” of the Diaoyu Islands, the Chinese government issued the Statement of the Government of the People’s Republic of China on the Baselines of the Territorial Sea of Diaoyu Dao and Its Affiliated Islands and the white paper Diaoyu Dao, an Inherent Territory of China, and through measures such as routine law enforcement patrols, exercised administration over the Diaoyu Islands and their adjacent waters, resolutely defending state sovereignty.

Solidarity and cooperation between China and developing countries made important progress; policy documents on China’s relations with Africa and with Latin America and the Caribbean were successively issued. In November 2006, the Beijing Summit of the Forum on China-Africa Cooperation was held; the summit declaration solemnly announced the establishment of a new type of strategic partnership between China and Africa. China continued to provide assistance to developing countries within its means, and solidarity and cooperation with the broad developing world was continuously strengthened.

China used multilateral platforms to promote the resolution of international and regional hotspot issues. After the international financial crisis erupted, China promoted reform of the global economic governance mechanism by attending G20 Leaders’ Summits and APEC Leaders’ Informal Meetings, and by hosting the Boao Forum for Asia Annual Conference. China promoted the establishment of the BRICS Leaders’ Meeting mechanism; beginning in 2009, BRICS leaders held regular meetings, enhancing the representation and voice of emerging market countries and developing countries in global governance. China also actively participated in international cooperation on global issues such as security and counter-terrorism, fully demonstrating the image of a responsible major power.

During this period, the Chinese government practiced the principle of “diplomacy for the people,” properly handling major emergencies such as evacuations of nationals, hostage rescues, and labor disputes. In particular, during February and March 2011, when a tense situation arose in Libya, our state rapidly and in an orderly manner organized the largest-scale evacuation of overseas Chinese nationals (including compatriots from Hong Kong, Macao, and Taiwan) since the founding of New China, safely evacuating all 35,860 Chinese nationals in Libya back to the country, effectively safeguarding the personal safety and legitimate rights and interests of Chinese citizens overseas.

VIII. Raising the Level of Scientific Party Building and Establishing the Scientific Outlook on Development as the Party’s Guiding Thought

Strengthening the Party’s Capacity to Govern and Building the Party’s Advanced Nature

Building a Moderately Prosperous Society in all respects in the new century and at a new stage placed new and higher demands on the Party’s capacity to govern. The Party Central Committee upheld the strengthening of governing capacity and the building of advanced nature as the main thread, closely integrated with the practice of governance and administration of China, and continued to comprehensively advance the new great project of Party building.

The Sixteenth National Congress put forward the proposition of “strengthening the Party’s capacity to govern.” In September 2004, the Fourth Plenary Session of the Sixteenth Central Committee adopted the Decision of the CPC Central Committee on Strengthening the Party’s Capacity to Govern, further expounding the goals and connotations of governing scientifically, governing democratically, and governing according to law, and explicitly putting forward the need to continuously improve the capacity to steer the socialist market economy, to develop socialist democratic politics, to build an advanced socialist culture, to build a socialist harmonious society, and to respond to the international situation and handle international affairs. Hu Jintao emphasized at the plenary session the need to conduct comprehensive, systematic, and in-depth research closely focused on the major questions of for whom to govern, on whom to rely in governing, and how to govern, and to strive to make the Party’s governing strategy more complete, its governing system more sound, its governing methods more scientific, and its governing foundation more consolidated.

In implementing the requirements of the Sixteenth National Congress and the Fourth Plenary Session of the Sixteenth Central Committee, the Party led the state’s legislative bodies in scientific and democratic legislation, revising the Constitution and the Electoral Law and Organic Law of the People’s Congresses, promulgating the Supervision Law of the Standing Committees of People’s Congresses at All Levels, improving the fundamental political system, and making the Party’s governing system more sound, thereby providing a standardized legal framework for strengthening the Party’s capacity to govern. The Party Central Committee also successively made arrangements for deepening administrative management system and institutional reform, and for strengthening the work of the Chinese People’s Political Consultative Conference and the people’s courts and people’s procuratorates, organically integrating Party leadership, the people being masters of the country, and governance according to law, expanding people’s democracy, and continuously improving the Party’s capacity to govern scientifically, democratically, and according to law.

In November 2004, the Party Central Committee issued a document making arrangements for carrying out throughout the Party an education campaign to maintain the advanced nature of Communist Party members, with the practice of the “Three Represents” as the main content. In January 2005, Hu Jintao put forward the major proposition of “building the Party’s advanced nature” at a special report meeting on maintaining the advanced nature of Communist Party members in the new period, emphasizing that building the Party’s advanced nature is the fundamental task of a Marxist party’s own construction. The advanced nature education campaign began in January 2005, was carried out in three batches, and was essentially concluded in June 2006. The education campaign focused on resolving prominent problems in the thinking, organization, work style, and work of party members and party organizations, and achieved fruitful results.

Following the Sixteenth National Congress, centered on the main thread of strengthening the Party’s capacity to govern and building the Party’s advanced nature, the Party Central Committee also put forward and implemented a series of important measures for strengthening Party building. These mainly included: implementing the call for senior cadres to take the lead in study, and establishing the system of collective study sessions of the Political Bureau of the Central Committee; establishing the system of the standing committees of central and local party committees at all levels being responsible to, reporting work to, and accepting oversight from the full committee, as well as the system of proposals by delegates to party congresses and the mechanism for handling and responding to delegate proposals; reforming the cadre and personnel system and implementing open selection and competitive appointment; intensifying Party building work in new economic organizations and new social organizations, and expanding the coverage of primary-level party organizations. The Party Central Committee also decided to establish the China Executive Leadership Academy Pudong, the China Executive Leadership Academy Jinggangshan, and the China Executive Leadership Academy Yan’an, organizing large-scale and multi-level training to focus on improving the capacity and quality of party cadres.

Raising the Level of Scientific Party Building

While enshrining the Scientific Outlook on Development in the Party Constitution, the Seventeenth National Congress made arrangements for carrying out throughout the Party an in-depth campaign to study and practice the Scientific Outlook on Development. From September 2008 to the end of February 2010, the entire Party carried out this in-depth study and practice campaign. Closely centered on the general requirements of party cadres receiving education, scientific development reaching a higher level, and the people gaining concrete benefits, this study and practice campaign essentially achieved the goals of raising ideological understanding, resolving prominent problems, innovating institutional mechanisms, promoting scientific development, and strengthening primary-level organizations.

In the course of the study and practice campaign, the Party Central Committee made new decisions and arrangements on how to strengthen and improve Party building under new conditions, in light of changes in the world situation, national conditions, and party conditions. In September 2009, the Fourth Plenary Session of the Seventeenth Central Committee adopted the Decision of the CPC Central Committee on Several Major Issues Concerning Strengthening and Improving Party Building Under New Conditions, putting forward the major proposition and major task of raising the level of scientific Party building. Subsequently, the Party Central Committee repeatedly emphasized: upholding the use of the theoretical system of socialism with Chinese characteristics to arm the entire Party, and guiding Party building with scientific theory; establishing and improving an institutional system with the Party Constitution as the foundation and democratic centralism as the core, and guaranteeing Party building with scientific institutions; and creatively researching and resolving new questions posed by the development of the times and social transformation for Party building, and advancing Party building with scientific methods.

Centered on raising the level of scientific Party building, the Party Central Committee focused on advancing intra-party institutional building, revising and issuing documents such as the regulations on the work of primary-level organizations of Party and state organs and the interim provisions on accountability of leading party and government cadres, effectively resolving some new problems encountered in Party building. In May 2012, the CPC Central Committee issued the Regulations of the Communist Party of China on the Formulation of Intra-Party Regulations, striving to promote strict Party governance and advance scientific, democratic, and law-based governance by standardizing the formulation, approval, filing, and review of intra-party regulations.

To consolidate and expand the results of the Party-wide in-depth campaign to study and practice the Scientific Outlook on Development, in April 2010 the Party Central Committee decided to carry out the campaign to “create advanced primary-level party organizations and strive to be outstanding Communist Party members” among primary-level party organizations and party members, and to make this an important and regular component of Party building. Regions, departments, and units across the country made contributions in promoting scientific development, advancing social harmony, serving the people, and strengthening primary-level organizations, giving full play to the role of primary-level party organizations as fighting fortresses and the vanguard and exemplary role of Communist Party members. Yang Shanzhou, former Secretary of the Baoshan Prefectural Committee of the Communist Party in Yunnan Province, lived up to his pledge of “as long as life does not end, service to the people does not stop.” After retirement, he rolled up his bedding and headed into the mountains, spending 22 years planting trees and forests as a volunteer, leading the people to transform 56,000 mu of barren hills into green oases. Guo Mingyi, a worker at Anshan Iron and Steel Group, studied Lei Feng and did good deeds day after day for decades, earning the reputation of “the Lei Feng of the new era.” In the campaign to create advanced organizations and strive for excellence, their advanced deeds aroused a strong response among the broad masses of party cadres and the people, and a nationwide wave of learning from Yang Shanzhou, Guo Mingyi, and others arose.

Solidly Advancing the Building of the System for Punishing and Preventing Corruption

Enhancing the capacity to resist corruption and degeneration and to withstand risks is a long-term historic challenge facing the governing party. The Party Central Committee consistently maintained a clear-headed understanding of the long-term, complex, and arduous nature of the struggle to build Party conduct and combat corruption, and—with an eye toward maintaining the Party’s advanced nature and purity—placed the building of Party conduct and the anti-corruption struggle in a prominent position. In October 2003, the Third Plenary Session of the Sixteenth Central Committee put forward the goal of establishing and improving a system for punishing and preventing corruption that is compatible with the socialist market economy system and that gives equal weight to education, institutions, and oversight.

In the anti-corruption struggle, a work pattern was gradually established of maintaining clean and honest conduct among leading cadres, investigating and handling cases of violations of discipline and law, and rectifying unhealthy tendencies in departments and industries. In terms of the leadership system and working mechanism for anti-corruption and clean governance, a system and mechanism was formed of unified Party committee leadership,

joint management by Party and government, organizational coordination by discipline inspection commissions, each department bearing its own responsibilities, and relying on the support and participation of the masses. In terms of the mechanism for the exercise of power, a power structure and operating mechanism was established and improved in which decision-making power, executive power, and oversight power both constrain and coordinate with each other.

In terms of institutional building for anti-corruption and clean governance, a series of regulations were formulated, including the Several Guidelines on Clean and Honest Conduct for Party Member Leading Cadres of the Communist Party of China, the Regulations of the Communist Party of China on Disciplinary Sanctions, the Provisions on Leading Cadres Reporting Personal Matters, and the Interim Provisions on Strengthening the Management of State Personnel Whose Spouses and Children Have All Emigrated Abroad. In February 2006, our state became a signatory to the United Nations Convention Against Corruption, and international cooperation in anti-corruption was strengthened.

In terms of lawfully investigating and handling major cases, while upholding the investigation and handling of key cases, emphasis was placed on investigating and handling cases of leading cadres engaging in collusion between officials and businesspeople, trading power for money, and soliciting and accepting bribes; cases of serving as “protective umbrellas” for criminal and evil forces; cases of seriously harming the interests of the masses; and corruption cases behind mass incidents and major liability accidents. From November 2007 to June 2012, discipline inspection and supervision organs across the country filed more than 643,700 cases, concluded more than 639,000 cases, and imposed party and administrative disciplinary sanctions on more than 668,000 persons. More than 24,000 persons suspected of crimes were transferred to judicial organs for handling. In particular, following the Sixteenth National Congress, major cases of serious violations of discipline and law involving Chen Liangyu and others were resolutely investigated and handled, demonstrating the Party Central Committee’s firm determination to combat corruption.

In terms of rectifying unhealthy tendencies that harm the interests of the masses, the Party Central Committee carried out special work to stop overseas travel at public expense, special rectification of official vehicle problems, and special rectification of prominent problems in engineering and construction, investigating and handling a large number of cases of violations of discipline and law. While conducting in-depth special rectification, efforts were also intensified to rectify unhealthy tendencies, correcting behaviors that harm the interests of the masses in education, medical care, land acquisition and demolition, land and mineral resource management, food and drug safety, environmental protection, work safety, affordable housing construction and management, and law enforcement and judicial work, effectively safeguarding the legitimate rights and interests of the people, and achieving good social results.

Through persistent exploration and effort, the level of scientific Party building was continuously raised, playing an important role in maintaining the Party’s advanced nature and purity, and providing a strong guarantee for the Party’s leadership of reform and opening up and socialist modernization. However, it must also be recognized that the soil breeding corruption still exists, and the anti-corruption situation remains severe and complex. In some localities and departments, corruption has tended to become more serious, with regional corruption, systemic corruption, family-style corruption, and landslide-style corruption emerging, seriously harming the health of the Party’s organism. Steadfastly strengthening Party leadership, persistently strengthening Party building, and resolutely containing the spread of corruption still require arduous efforts from the entire Party from top to bottom.

Establishing the Scientific Outlook on Development as the Party’s Guiding Thought

After the Scientific Outlook on Development was put forward, it went through a process of practice, understanding, further practice, and further understanding; its theoretical connotations were continuously enriched, and its practical results continuously manifested. The Scientific Outlook on Development provided new scientific answers to the major questions of what kind of development to achieve and how to achieve it under new conditions, raising the Party’s understanding of the laws of socialism with Chinese characteristics to a new level.

In 2012, the Eighteenth National Congress formally established the Scientific Outlook on Development as the Party’s guiding thought. The Congress pointed out that, in summing up ten years of struggle, the most important thing was upholding Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory, and the “Three Represents” as the guide, having the courage to advance theoretical innovation on the basis of practice, and putting forward a series of closely connected and mutually consistent new ideas, new viewpoints, and new expositions centered on upholding and developing socialism with Chinese characteristics, thereby forming and implementing the Scientific Outlook on Development. The Scientific Outlook on Development is the product of combining Marxism with contemporary Chinese realities and the characteristics of the times; it is the concentrated embodiment of the Marxist worldview and methodology on development; and it has opened up new horizons in the development of contemporary Chinese Marxism. The Scientific Outlook on Development is an important component of the theoretical system of socialism with Chinese characteristics; it is the crystallization of the collective wisdom of the Communist Party of China; and it is a powerful ideological weapon guiding all the work of the Party and the state. The Scientific Outlook on Development, together with Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory, and the “Three Represents,” is guiding thought that the Party must uphold over the long term. Establishing the Scientific Outlook on Development as the Party’s guiding thought was an important decision and historic contribution of the Eighteenth National Congress. The Congress pointed out that, looking to the future, thoroughly implementing the Scientific Outlook on Development is of major practical significance and far-reaching historical significance for upholding and developing socialism with Chinese characteristics, and it is essential to run the Scientific Outlook on Development throughout the entire process of our state’s modernization and to embody it in all aspects of Party building.

[1] In December 2014, in light of Zhou Yongkang’s serious violations of party discipline, the CPC Central Committee decided, following a formal investigation, to expel him from the Party. In June 2015, Zhou Yongkang was sentenced to life imprisonment and permanently deprived of his political rights by the First Intermediate People’s Court of Tianjin on charges of bribery, abuse of power, and intentional disclosure of state secrets.

[1] 2014年12月，鉴于周永康严重违纪，中共中央经立案审查后决定给予其开除党籍处分。2015年6月，周永康因受贿、滥用职权、故意泄露国家秘密罪被天津市第一中级人民法院判处无期徒刑，剥夺政治权利终身。

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