Hold High the Great Banner of Socialism with Chinese Characteristics and Strive for New Victories in Building a Moderately Prosperous Society in all Respects

Report to the Seventeenth National Congress of the Communist Party of China on Oct. 15, 2007

Hu Jintao

Comrades,

Now I would like to make a report to the Seventeenth National Congress of the Communist Party of China (CPC) on behalf of the Sixteenth Central Committee.

The Seventeenth Congress is one of vital importance being held at a crucial stage of China's reform and development. The theme of the congress is to hold high the great banner of socialism with Chinese characteristics, follow the guidance of Deng Xiaoping Theory and the important thought of Three Represents, thoroughly¹ apply the Scientific Outlook on Development, continue to emancipate² the mind, persist in reform and opening up, pursue development in a scientific way, promote social harmony, and strive for new victories in building a moderately prosperous society in all respects.

The great banner of socialism with Chinese characteristics is the banner guiding development and progress in contemporary China and rallying the whole Party and the people of all ethnic³ groups in the country in our common endeavor. Emancipating⁴ the mind is a magic instrument for developing socialism with Chinese characteristics, reform and opening up provide a strong driving force for developing it, and scientific development and social harmony are basic requirements for developing it. Building a moderately prosperous society in all respects is a goal for the Party and the state to reach by 2020, and represents the fundamental interests of the people of all ethnic groups.

The world today is undergoing extensive and profound changes, and contemporary China is going through a wide-ranging and deep-going transformation⁵. This brings us unprecedented⁶ opportunities as well as unprecedented challenges, with the formeroutweighing the latter. The whole Party must unswervingly hold high the great banner of socialism with Chinese characteristics and lead the people in starting from this new historical point, grasping and making the most of the important period of strategic opportunities, staying realistic and pragmatic,forging ahead with determination, continuing to build a moderately prosperous society in all respects and accelerate socialist⁷ modernization⁸, and accomplishing the lofty mission bestowed⁹ by the times.

I. The Work of the Past Five Years

The five years since the Sixteenth Congress was an extraordinary period. In order to accomplish the arduous¹⁰ tasks of reform and development in a complicated and volatile¹¹ international situation, the Party led the people of all ethnic groups in holding high the great banner of Deng Xiaoping Theory and the important thought of Three Represents, overcoming difficulties and risks, creating a new situation in the cause of socialism with Chinese characteristics and attaining¹² a new realm in adapting Marxism to conditions in China.

At its Sixteenth Congress the Party established the important thought of Three Represents as its guide and made the strategic decision to build a moderately prosperous society in all respects. In order to implement¹³ the guiding principles of the congress, the Central Committee convened¹⁴ seven plenary sessions, at which it made decisions on and arrangements for major issues of overall significance such as deepening institutional restructuring, improving the socialist market economy, strengthening the governance capability¹⁵ of the Party, drawing up the Eleventh Five-Year Plan (2006-10), and building a harmonious¹⁶ socialist society; and it formulated¹⁷ and applied¹⁸ the Scientific Outlook on Development and other major strategic thoughts. All this helped the Party and the state score great new achievements.

Economic strength increased substantially. The economy sustained steady and rapid growth. The GDP expanded by an annual average of over 10%. Economic performance improved significantly, national revenue rose markedly year by year, and prices were basically stable. Efforts to build a new socialist countryside yielded solid results, and development among regions became more balanced. The endeavor to make China an innovative¹⁹ nation registered good progress, with considerable improvement in the country's capacity for independent innovation. Notable achievements were scored in the construction of infrastructure²⁰ including energy, transport and telecommunications facilities and other key projects. Manned spaceflights were successfully conducted. Fresh progress was registered in energy, resources, ecological²¹ and environmental conservation. The Tenth Five-Year Plan (2001-05) was fulfilled successfully and implementation²² of the eleventh is in smooth progress.

Major breakthroughs were made in reform and opening up. Comprehensive reforms in rural areas gradually deepened; agricultural tax, livestock²³ tax and taxes on special agricultural products were rescinded²⁴ throughout the country; and policies were constantly strengthened to support and benefit agriculture, rural areas and farmers. Significant headway was made in reform of the state assets management system, state-owned enterprises, banking²⁵, public finance, taxation²⁶, investment, pricing, and the system for managing science and technology. The non-public sector²⁷ of the economy grew stronger. A sound market system was being put in place, macroeconomic regulation continued to improve, and transformation of government functions was accelerated. The total volume of imports and exports increased sharply. Solid steps were taken in implementing²⁸ the "go global" strategy, and the open economy entered a new stage of development.

Living standards improved significantly. Both urban and rural incomes increased considerably²⁹, and most families had more property than before. The system of subsistence allowances for urban and rural residents was basically in place, guaranteeing basic living conditions for the poor. Residents improved their consumption patterns, had increasingly better food, clothing, housing, transport and other daily necessities, and enjoyed markedly improved public services.

Fresh progress was registered in improving democracy and the legal system. Political restructuring progressed steadily³⁰. Constant improvement was made in the system of people's congresses, the system of multiparty cooperation and political consultation³¹ under the leadership of the CPC and the system of regional ethnic autonomy. Primary-level democracy increased its vitality³². The cause of human rights witnessed sound development.The patriotic³³ united front grew stronger. A socialist law system with Chinese characteristics was basically in place. The rule of law was effectively implemented³⁴ as a fundamental principle. Reform of the government administration system and the judicial³⁵ system continued to deepen.

A new situation was created in cultural development. Efforts to establish the system of socialist core values made steady headway and marked achievements were scored in the Project to Study and Develop Marxist Theory. Extensive efforts were made to raise ideological³⁶ and ethical³⁷ standards and the whole of society became more culturally advanced. Cultural restructuring made important progress, cultural programs and the cultural industry developed rapidly, and the people enjoyed a richer cultural life. Fresh progress was made inpublic fitness programs and competitive sports.

Social development proceeded in an all-round way. Education of various kinds and at different levels developed rapidly. Free compulsory³⁸ education was made available in all rural areas. More job opportunities were created. The social security system was strengthened. The battle against SARS came to a great victory. The public health system and basic medical care constantly improved, contributing to better health of the people. Social management improved step by step. Social stability was ensured and the people lived and worked in peace and contentment.

Historic achievements were scored in the development of national defense³⁹ and the armed forces. The revolution in military affairs with Chinese characteristics was accelerated. The armed forces were reduced by 200,000 troops. Efforts were intensified⁴⁰ in all respects to make the armed forces more revolutionary, modernized⁴¹ and standardized⁴², which notably⁴³ increased their capacity to accomplish their historical missions at this new stage in the new century.

Work related to Hong Kong, Macao and Taiwan affairs was intensified. Hong Kong and Macao maintained their prosperity and stability and developed closer economic partnership⁴⁴ with the mainland. Political parties on both sides of the Taiwan Straits started communication, and cross-Straits visits as well as economic and cultural exchanges reached a new high. The Anti-Secession Law was enacted⁴⁵ to resolutely⁴⁶ safeguard China's sovereignty and territorial⁴⁷ integrity.

Major progress was made in all-directional diplomacy⁴⁸. Pursuing an independent foreign policy of peace, China energetically carried out diplomatic activities, enhanced exchanges and cooperation with other countries in various fields and played a major constructive⁴⁹ role in international affairs. This created a favorable international environment for building a moderately prosperous society in all respects.

The great new undertaking⁵⁰ to build the Party made solid progress. Endeavors to strengthen the Party's governance capability and vanguard nature were intensified. Efforts to make theoretical innovations and arm Party members with the achievements proved successful. The campaign to educate Party members to preserve their vanguard nature yielded substantial results. Intra-Party democracy continued to expand. Major headway was made in strengthening the Party's leading bodies and the ranks of its cadres, and especially in educating and training cadres. Work in relation to talented personnel was strengthened. Efforts were stepped up to reform the cadre and personnel system and make innovations in the organizational system. Remarkable⁵¹ results were achieved in improving the Party's style of work, upholding integrity and combating corruption⁵².

While recognizing our achievements, we must be well aware that they still fall short of the expectations of the people and that there are still quite a few difficulties and problems on our way forward. The outstanding ones include the following: Our economic growth is realized at an excessively high cost of resources and the environment. There remains⁵⁴ an imbalance in development between urban and rural areas, among regions, and between the economy and society. It has become more difficult to bring about a steady growth of agriculture and continued increase in farmers' incomes. There are still many problems affecting people's immediate⁵⁵ interests in areas such as employment, social security, income distribution, education, public health, housing, work safety, administration of justice and public order; and some low-income people lead a rather difficult life. More efforts are needed to promote ideological and ethical progress. The governance capability of the Party falls somewhat short of the need to deal with the new situation and tasks. In-depth investigations⁵⁶ and studies have yet to be conducted on some major practical issues related to reform, development and stability. Some primary Party organizations are weak and lax. A small number of Party cadres are not honest and upright, their formalism and bureaucratism are quite conspicuous⁵⁷, and extravagance, waste, corruption and other undesirable⁵⁸ behavior are still serious problems with them. We must pay close attention to these problems and continue our efforts to solve them.

To sum up, the past five years was a period in which substantial progress was made in reform, opening up and building a moderately prosperous society in all respects. During this period, China's overall strength grew considerably and the people enjoyed more tangible⁵⁹ benefits. China's international standing⁵³ and influence rose notably. The creativity, cohesion⁶⁰ and combat effectiveness of the Party increased significantly, and the whole Party and the people of all ethnic groups became more united. Facts have proved that the major policy decisions made by the Central Committee at and since the Sixteenth Congress are perfectly⁶¹ correct.

Our achievements over the past five years are attributed to the concerted efforts of the whole Party and the people of all ethnic groups. On behalf of the Central Committee, I wish to express our heartfelt thanks to the people of all ethnic groups, the democratic parties, people's organizations and patriots⁶² from all walks of life, to our compatriots in the special administrative⁶³ regions of Hong Kong and Macao and in Taiwan as well as overseas Chinese nationals, and to our foreign friends who care about and support China's modernization drive！