4. We deepened implementation of the innovation-driven development strategy, spurring the growth of new drivers for economic development.
The National Strategy for Innovation-Driven Development was published and implemented. With a number of major scientific and technological advances as well as rapid growth in high-tech industries, equipment manufacturing, and strategic emerging industries, innovation has played an increasingly important role in bolstering development.
1) Innovation capacity continued to improve.
We ensured the progressive and orderly development of major science and technology innovation platforms, and deepened pilot reforms on all-around innovation in eight regions. New strides were made in setting up science and technology innovation centers in Beijing and Shanghai. Work began to establish three national demonstration zones for the transfer and commercialization of scientific and technological achievements in Hebei-southern Beijing, Zhejiang, and Ningbo. The first national technology innovation center for high-speed trains was established, and the first Chinese-standard high-speed trains for which we hold complete intellectual property rights went into service. A number of major science and technology infrastructure projects were completed such as the project to build the world's largest single-aperture radio telescope, the Five-hundred-meter Aperture Spherical Telescope (FAST). A number of significant scientific and technological advances were achieved in sectors including quantum communications, space, and aviation.
We pressed ahead with implementing major national science and technology programs, and identified major projects for the Sci-Tech Innovation 2030 Agenda. A big push was made to encourage technological innovation among enterprises, with policies being implemented in relation to extra tax deductions for R&D costs, equity-based incentives for undertaking innovation, income tax incentives for personnel who contribute their technological achievements to become company shareholders, and improvements in the methods for defining new- and high-tech enterprises.
Box 8: Major Science and Technology Innovation Platforms
2) Entrepreneurship and innovation initiatives were carried out across the board.
Work on establishing 28 national entrepreneurship and innovation demonstration centers moved forward on all fronts. Information service platforms for entrepreneurship and innovation policies began operating, and a whitepaper on entrepreneurship and innovation was published. The national seed fund for investing in emerging industries, the sub-funds of the seed fund for encouraging the application of scientific and technological advances, and the National SME Development Fund all came into operation. Trials got underway to allow banks to make combined debt-equity investments in startups and small businesses, and creative improvements were made to the system of guaranteed loans for business startups. The second National Week for Entrepreneurship and Innovation and the Innovating China Tour were a tremendous success. 128 platforms for entrepreneurship and innovation were developed by large-scale central government enterprises, guidelines on further improving the policies for managing the funding of central government-funded research programs were published and implemented, and mechanisms for encouraging entrepreneurship and innovation were gradually improved in research institutes and universities. All types of incubators and professional maker spaces saw continuous development. On average, 15,100 new enterprises were registered each day in 2016.
3) New technologies and industries as well as new forms and models of business flourished.
There was rapid development in industrial robotics, integrated circuits, satellite applications, general aviation, bio-industry, and other new industries, while growth in strategic emerging industries was stable. In 2016, enterprises with annual turnover of 20 million yuan or more in 27 key strategic emerging industries increased their revenues by 11.32% and profits by 13.96%. We pressed ahead with implementing the Internet Plus initiative and the national big data strategy. Artificial intelligence, virtual reality, genetic engineering, and other new technologies experienced more rapid development. The platform, sharing, and collaborative economies, along with other new business models, achieved far-reaching penetration. New forms of business mushroomed, including combined online-offline businesses, cross-border and social networking e-commerce, smart home technology, and intelligent transportation. Online retail sales for 2016 reached nearly 5.2 trillion yuan, a year-on-year increase of 26.2%, with online retail sales of goods accounting for 12.6% of total retail sales of consumer goods.
4) Transformation and upgrading of traditional industries accelerated.
We moved faster to put the Made in China 2025 strategy into place, and organized implementation of the three-year action plan to enhance core competitiveness of our manufacturing industries and the project packages for transformation and upgrading of the manufacturing sector. The eight plans for industrial application were implemented smoothly. Major breakthroughs were made in research and development on key railway equipment. A total of 226 programs to run comprehensive, standardized tests on smart manufacturing technologies and apply new manufacturing models proceeded as planned. We made progress in building the National Robot Test and Evaluation Center. An investment fund for advanced manufacturing was set up.
* The six corridors refer to economic corridors, comprising the New Eurasian Continental Bridge, the China-Mongolia-Russia corridor, the China-Central Asia-West Asia corridor, the China-Indochina Peninsula corridor, the China-Pakistan corridor, and the Bangladesh-China-India-Myanmar corridor. The six channels refer to communications and distribution channels comprising highways, railways, airlines, waterways, pipelines, and information networks.
5) Solid steps were made in innovating and developing the service industry.
We implemented the guidelines on accelerating the development of producer and consumer services and published the implementation plan for relaxing controls over market access in the service sector. A new round of comprehensive pilot reforms in the service sector began. We allocated funds for guiding the development of the service industry and supported the establishment of 163 public-service platforms. The tertiary industry has continued to outgrow the secondary industry, and the value-added of the tertiary industry accounted for a higher proportion of GDP, reaching 51.6%.
6) Further improvements were made to infrastructure networks.
As a result of accelerated development of the modern comprehensive transportation system, the length of transportation infrastructure networks open to traffic exceeded five million kilometers. We unveiled and implemented the 100 Demonstration Projects to Improve Transportation Quality and Efficiency, 200 Transportation Projects to Help Reduce Poverty, and 300 Major Transportation Infrastructure Projects. We worked to stimulate development of multimodal transportation and the general aviation industry and integrated the development of transportation and logistics infrastructure.
The strategy on revolutionizing energy generation and consumption was launched, and energy supply capacity continued to grow stronger. The proportion of non-fossil energy consumption rose to an estimated 13.3% of total energy consumption while the proportion of coal consumption dropped to 62.0%. Fiber-optic networks were established in almost all prefecture-level cities, next-generation information infrastructure saw yet further enhancements, and China's 4G network, which is the world's largest, was completed.
Box 9: Major Infrastructure Construction
5. We worked to increase the capacity for sustainable agricultural development and achieved new progress in agricultural modernization.
The trend of ensuring progress while maintaining stability continued in agricultural and rural development and grain output reached 616 million metric tons, thus ensuring agriculture served as a strong pillar of economic and social development.
1) Agricultural production capacity continued to increase.
We implemented the plan to increase China's grain production capacity by 50 million metric tons, moved faster to develop high-quality farmland, and completed in full the work of designating permanent basic cropland throughout the country. As a result, our ability to guarantee national food security and the supply of major agricultural products has been further increased. New grain silos with a total capacity of 9.75 million metric tons were built. In working to optimize agricultural production while maintaining its stability, we reduced the area of land for corn kernel cultivation by 1.36 million hectares, expanded trials to cultivate feed crop or soybean crop instead of grain crop, and continued to raise overall production capacity for livestock and aquatic products.
We made steady progress in promoting green agricultural development, launching a campaign to control and prevent serious agricultural environmental pollution, establishing pilot demonstration zones for sustainable agricultural development, and securing important achievements in implementing the action plan against pollution in rural areas*. We intensified support for trials to comprehensively manage agricultural pollution from non-point sources, chernozem soils in the northeast, and former grassland now under cultivation in transition areas between cropland and grassland.
2) Agricultural and rural infrastructure continued to improve.
We successfully implemented projects to harness small and medium-sized rivers, reinforce small, dilapidated reservoirs, build key irrigation and drainage facilities as well as upgrade supporting infrastructure, and develop small-scale irrigation and water conservancy facilities. The area of cropland under efficient water-saving irrigation exceeded 1.33 million hectares. We also launched the project to consolidate and advance efforts to ensure safe drinking water in rural areas.
A new round of power-grid improvement projects began throughout the country, including key projects for upgrading power grids in rural areas, small towns, and hub villages, and for providing power supply to all electric pump sets on rural flatlands. Transportation infrastructure and services in rural areas were continuously improved, and 290,000 kilometers of rural road were newly built or upgraded. We continued to implement broadband development projects in villages, carried out nationwide trials of providing universal telecommunications services in rural areas, and further improved rural information infrastructure.
3) Integrated development of the primary, secondary, and tertiary industries in rural areas advanced smoothly.
The "100 counties, 1,000 townships, 10,000 villages" pilot demonstration project to promote rural industrial integration was implemented, with all 137 demonstration counties undertaking active explorations on how to improve development plans, promote integration between industrial development and urbanization initiatives, establish an industry system for modern agriculture, and innovate investment and financing mechanisms in the agricultural sector. We accelerated efforts to establish incubation parks for integrated development of industries in rural areas, develop diverse entities that integrate primary, secondary, and tertiary industry operations, and cultivate a group of leading enterprises in agricultural industrialization. New industries and new forms of business in rural areas experienced robust growth.
* The action plan aims to: 1) control water consumption for agricultural purposes; 2) cut the use of pesticides and chemical fertilizers; 3) use recycling as a means of handling the pollution caused by the waste of livestock and poultry farming, plastic mulch film, and straw burning.
4) Solid results were achieved in rural reform.
We issued and implemented the Measures for Separating Land Ownership Rights, Contract Rights, and Management Rights in Rural Areas, and determined, registered, and certified contracted rural land-use rights for more than 53.3 million hectares of land. The determination and registration of integrated housing ownership and land-use rights for rural housing land and rights for collectively owned land designated for construction was accelerated. We drew up the Guidelines on Reforming the Rural Collective Property Rights System, and moved ahead with pilot reforms to grant shareholder rights for rural collective assets as well as trials to permit the sale of land contract rights. We carried out trials in a prudent and orderly fashion to allow rural residents to mortgage their contracted land-use rights and residential property rights. The cases of transferring or mortgaging rural land use rights have continually increased. New types of agribusinesses thrived and their number rose to more than 2.7 million.