These opportunities lie mainly in the realm of government support. The Central Government has attached more and more importance to the development of small and medium-sized enterprises by issuing a series of policies and documents for the fast and healthy development of the enterprises. The private enterprises have thus had more space and market potential.

After decades of development, private enterprises have gathered economic strength and grasped some good chances while exploring good development models—especially in the fields of recycling economies, ecological environment protection and energy conservation. For further development, I think the private enterprises should have three "transformations." The first would be to transform the ideas from focusing on small businesses.

The second is to transform development strategies. Our private enterprises have a common problem: how to grow big and strong sufficiently. We saw many enterprises holding the banner of being "the top 500 in the world as soon as possible." This is a result of impatience.

The third is to develop technological innovation within enterprises and increase the added value to the products.

Changing Ideas

Li Lijun: member of the 11th CPPCC National Committee and Deputy Director of the Supervision Department of Hunan Provincial Government

The importance of transforming the economic development model has been mentioned for a long time—while the measures of the transformation have hardly been put into practice. The fundamental reason, I think, is the traditional economic development model mainly focuses on extensive development and the increase of total output and the GDP has been the evaluation criteria for the government. This traditional model has helped for a period the fast economic development. But with time, more negative aspects have become apparent and became an obstacle for the transformation.

The first negative effect has been on scientific and technological development. Independent innovation is time-consuming and cannot make obvious achievements within a short period. While guided with a traditional model, local governments prefer to engage in short-term projects such as in the chemical industry and manufacturing and are not interested in efforts involving the latest technological research. This makes "independent innovation," as encouraged by the Central Government, a mere slogan. Consequently, chemical industries, which require little time but are more profitable, for example, have witnessed more development in many places at the expense of environmental safety and conservation.

The second is that there exists an unhealthy climate in terms of competition for attracting foreign investment. In order to draw foreign investment, that is, local governments frequently offer many preferential policies for the foreign companies while allowing for the deterioration of the environment in which domestic enterprises operate.

The third negative aspect is that this situation has led to many low-quality, redundant construction projects—while creating overcapacity.

My suggestion is that the development ideas at different levels of government should be fundamentally shifted from focusing on quantity increases to quality upgrades—and from short-term increases to more sustainable development, which involves high technology elements.

We should also change the evaluation criteria for the government officials to set up a more scientific evaluation system.

A Triangle Economy

"Triangle is the most stable form" is a rule in natural science, and this rule also applies for social science. To keep a stable and healthy economic development in China, we also need a triangle development model.

One angle of the triangle is speed. We must put 8-9 percent of GDP growth as the medium- and long-term goal for economic development.

The second angle involves structure. In other words, in order to keep the triangle in normal shape, we must adjust economic structure. The investment, at present, should be put more on fastening the development of small cities, infrastructure construction, scientific and technological research and ecological environment protection.

The third edge of the triangle is safety—or the stability of the economic development. There are four elements that can threaten the safety of economic development. They are inflation, non-performing loans, fiscal deficits and an excessive foreign exchange reserve.