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In March 1986, the State Council submitted “The 7th Five Year Plan for National Economic and Social Development of the People’s Republic of China, 1986-1990” to the Fourth Session of the Sixth National People’s Congress for review and ratification. It was the first time in China’s history that an all-round plan for social and economic development was created at the start of a new five-year plan.

 

The fundamental principles and guidelines of the 7^th Five Year Plan were as follows:

1)      To put reform at the top of the agenda and coordinate economic development with reform.

2)      To maintain a basic balance between overall social demand and supply, between the national budget, credit and materials.

3)      To improve economic efficiency, especially that of product quality; to properly handle the relations between efficiency and growth rate, and quality and quantity.

4)      To adapt to the changing structure of social demand and the demands of economic modernization, and to further adjust the industrial structure.

5)      To regulate fixed asset investments, readjust the investment structure, and speed up the construction of the energy, communications, telecommunications and raw materials industries.

6)      To shift the construction focus to the technical updating, reforming and extending of existing enterprises.

7)      To further the development of science and education.

8)      To further open up to the outside world, combining domestic economic growth with expanding external economic and technologic exchanges.

9)      To further improve the material and cultural life of all Chinese.

10)   To strenuously boost the construction of a socialist ideological civilization along with the construction of a material civilization.

11)   To carry on in the spirit of arduous struggle, hard work and thrift.

 

Specific goals of economic development set out in the Plan were:

 

To increase gross national industrial and agricultural output by 38 percent within five years, or by an average annual rate of 6.7 percent, gross agricultural output by 4 percent a year, and gross industrial output by 7.5 percent.

 

To increase gross national output by 44 percent within five years, or by an average annual rate of 7.5 percent.

 

Production goals for major industrial and agricultural products by 1990 were: between 425 and 450 million tons for grain, 4.25 million tons for cotton, 550 billion kWh for electricity, 1 billion tons for raw coal, 150 million tons for crude oil, and between 55 and 58 million tons for steel. Freight volume was set at 9.4 billion tons.

 

Investment in fixed assets was set at 1,296 billion yuan, with fixed assets projected to grow by 600 billion yuan.

 

To increase total import and export volumes by 35 percent within the five years, while expanding the scale of foreign investment and advanced technology. Further, goals were set to increase the actual consumption of both urban and rural residents by 5 percent a year, and at the same time keeping the basic balance between the national budget, credit, material and foreign exchange.

 

In the field of education, to gradually popularize and implement the nine-year compulsory education scheme, and train five million professionals, twice that during the previous planning period.