3. Improving urban and rural planning, construction and management and enhancing the city's carrying capacity and level of services. Under the guidance of the Capital Planning Commission, we finished revising the city's master plan, defined Beijing's functions as being the capital and being a livable, cultural and cosmopolitan city, and established a layout of "two axial lines, two industrial belts and multiple centers." We also defined the functions for all our districts and counties and worked out a system of evaluation criteria, and the city's development gradually became more comprehensive and coordinated. We paid great attention to preserving historic sites in the city and renovated a number of valuable buildings of historical and cultural interests. We explored new ways to protect, renovate and organically upgrade historical and cultural zones in the city on the basis of government guidance. We improved the urban and rural road network, implemented the project to clear up traffic bottlenecks and effectively increased the city's traffic capacity. In the last five years, 669 kilometers of new roads and 162 kilometers of expressways were built; 8,770 kilometers of roads were upgraded; China's first high-capacity public highway was built; and 66.6 kilometers of rail transit lines were put into operation, raising the total to 142 kilometers and giving rise to a preliminary transport network. The overall development of public transport grew remarkably, with the orientation firmly on the public benefits of public transport. We introduced a low-fare policy, optimized bus lines, and comprehensively instituted the use of a single card for all municipal transport carriers. Work was completed on a number of landmark buildings such as the National Grand Theater and the Capital Museum. The main work on the Beijing section of the South to North Water Diversion Project was basically completed. We worked tirelessly to clean up air pollution, implemented the ninth through thirteenth stage measures for controlling air pollution, and adopted comprehensive measures to improve urban air quality. We effectively preserved Beijing's water environment by building 12 sewage treatment plants and a number of rural wastewater treatment facilities, and completing reclamation work on the main rivers in the city. We accomplished non-toxic disposal of almost all urban household garbage, and implemented the policy of villages collecting rural garbage, towns transporting it and districts treating it. We constantly improved facilities for the non-toxic disposal of hazardous wastes and built a storage facility for radioactive wastes. We restored the ecosystem in mines that had been closed or were no longer in operation, planted more than 70,000 hectares of forest to break the wind and control sand drift, basically put in place three green ecological shields – mountainous areas, plains and green isolation zones – and made notable progress in making the city greener and more beautiful. We let city residents play an important role in city management, made innovations in city management practices, set up a latticed management platform and raised our level of IT application. Consequently our ability to manage the city's services improved significantly, which was evident when we loosened prohibitions against fireworks and provided services for the Forum on China-Africa Cooperation.

4. Making preparations for hosting the 2008 Olympic and Paralympic Games with high standards and laying a solid foundation for their success. We resolutely implemented the instructions of the central authorities, comprehensively implemented the ideal of a green, high-tech and people-friendly Olympics, and constantly improved the quality of all our preparations for the Olympic and Paralympic Games. We optimized the design plans of Olympic venues and set the principle of integrating "safety, quality, function, construction time and cost" for building these venues, so that their construction progressed smoothly. We attached great importance to environmental protection and energy conservation, made extensive use of new technologies, processes and equipment, made numerous advances in independent innovation in areas including steel structure and membrane structure, and thus wrote a new chapter in the annals of China's architecture. We made orderly progress in ensuring essential services for the Olympics, such as urban transportation; public security; water, electricity, gas and heating supplies; handicap-friendly facilities; hotel and restaurant availability; commercial services and public order. We basically completed development of institutions and mechanisms for seamlessly coordinating the operation of venues, the security around the perimeters of venues and the operation of the city. Comprehensive environmental improvements were carried out in both urban and rural areas, and the overall appearance of the city improved greatly. An extensive campaign was launched to "welcome the Olympics, act in a civilized manner and create a better atmosphere." Five kinds of measures were taken to raise the level of civility of the city. Demonstration areas for good manners in public were set up. Training was conducted for industries and organizations that will frequently come into contact with the public during the Olympics. Cultural and fitness activities were carried out extensively among the people, such as campaigns to encourage the public to get more exercise in the preparations for the Olympics and to encourage people to learn and speak foreign languages. People's involvement in, contribution to and sharing in the Olympics grew day by day.

5. Improving our capacity for independent innovation, and accelerating the building of Beijing as an innovative city. We deepened the reform of the management system for science and technology, carried out science and technology plans, and organized the implementation of 210 major scientific and technological projects to significantly increase science and technology's contribution to the capital's development. We set up a fund to encourage independent innovation by enterprises that have shown good growth, supported the building of science and technology platforms, and helped enterprises to build technology centers, with the result that enterprises' role in making innovations was strengthened. The number of patent applications rose steadily, with invention patents accounting for more than 50%. We accelerated the building of a technological transfer and trading system, and technology-related contracts worth 88.26 billion yuan were signed in 2007. While encouraging independent innovation, we fostered the development of name brands, so that a large number of famous Chinese brands came to the fore. We optimized the areas of specialization in higher and vocational education, encouraged diversified cooperation among industries, universities and research institute, and supported the building of university science parks and enterprise incubators. Policies and measures were improved to encourage overseas students to start up businesses in China, an effective mechanism for attracting talent took shape, and more and more innovative personnel came to the capital. Guidelines and support measures for building an innovative city were introduced, and the environment for independent innovation constantly improved.
We implemented the important decision of the State Council on developing Zhongguancun Science Park, and smoothly finished all aspects of the work for meeting the goal of raising the park to a new level in five years. We undertook trials for instituting an agency stock transfer system for non-listed companies, and set up the framework for an investment and financing system that is based on credit and obtains financing through multiple channels. We integrated innovation resources, launched the pilot project to support 100 innovative enterprises, and helped set up 23 industrial technology alliances including IGRS. Enterprises became more capable of collaborating in making innovations, and a number of new technologies, products and standards emerged. The development of infrastructure and public service facilities was strengthened, the development of national industrial bases and parks progressed smoothly, and innovation clusters took shape.

6. Deepening reform and opening up and constantly improving the development environment. We adjusted the financial management systems of the municipal and district and county governments and improved the systems for budgetary and treasury management. Public spending accounted for 90.5% of all expenditures by the municipal government in 2007, up from 81.8% in 2002. Reform of the investment and financing system was accelerated, and trials were undertaken for implementing systems for backlogging government investment projects, announcing large projects and using construction agents to build nonprofit government-funded projects. We strengthened the oversight and management of state assets, completed the work of making an inventory of state assets and liabilities, and explored ways to set up a budget system for the operation of state capital. Adjustment, transformation, divestiture and bankruptcy of state-owned enterprises were carried out, and the layout and structure of the state economy were gradually optimized. We effectively eliminated financial risks and significantly strengthened the municipality's financial enterprises through such reform measures as carrying out reorganization and attracting strategic investors. We implemented the Administrative Permission Law, reduced the number of items subject to administrative examination and approval, fees or annual inspection for enterprises, and standardized examination and approval practices and procedures. One-stop services and the full-service agency system were expanded, and the mechanism for filing and handling administrative complaints was improved. The Liaison Office of the Beijing Municipal People's Government was set up to provide better services for the central authorities' enterprises and institutions in Beijing. We rectified and standardized the market, formulated rules for sales promotions by commercial enterprises and standard practices for suppliers and retailers, conscientiously launched a campaign to combat commercial bribery, strictly combated counterfeiting, piracy and business fraud, and further developed the enterprise creditability system. We eliminated restrictive regulations and set up a platform for financing services to encourage the development of non-public sectors of the economy. We undertook professional, area-specific activities to attract foreign investment, and provided a green channel for approval of foreign investment projects. We worked hard to streamline customs clearance procedures, promoted upgrading of the processing trade, expanded export of products with domestically held intellectual property rights and with Chinese brand names, and vigorously developed trade in services. Some 4.355 million overseas tourists visited Beijing in 2007 and spent $4.58 billion. We expanded our international contacts, and Beijing now has 41 international sister cities. We held several large conferences and exhibitions, such as the Science Expo, International Cultural & Creative Industry Expo, Beijing Hong Kong Economic Cooperation Symposium, Beijing-Taiwan Science and Technology Forum, and the Nobel Laureates Beijing Forum, and every one was more successful than the last. Further progress was made in providing assistance to designated areas and in coordinating development in the Beijing-Tianjin-Hebei region.

7. Effectively resolving issues affecting the people's well-being and accelerating the development of social programs. We improved policies designed to expand employment, focused on helping urban and rural residents who had difficulty finding employment, and saw to it that Beijing had almost no zero-employment households. We found a reasonable solution for the problem of wage arrears for migrant workers in the city by fully implementing a system of individual and collective labor contracts. We put into operation the old-age insurance system for rural residents, the new type of rural cooperative medical system and the subsistence guarantee system for rural residents. The rural social safety net was gradually set up. Coverage of basic old-age insurance, basic medical insurance and unemployment insurance was extended to more than 92% of the total urban population. We established a system of maternity insurance and a system of insurance for major diseases for the elderly and the young, 1.9 million migrant workers were covered by workers' compensation insurance and 1.66 million others had insurance for major diseases. We steadily increased social security benefits for both urban and rural residents, put in place the basic framework of an emergency assistance system, and accelerated the development of public welfare and charity programs. We increased our efforts to ease the housing difficulties of low-income families by building a total of 14 million square meters of affordable housing, and solved the housing problems of 26,000 lowest-income families by renting them government housing or giving them rental subsidies.
We set up and improved the mechanism for guaranteeing funding for compulsory education and increased the stipulated quotas for compulsory education expenses. We instituted a policy of waiving tuition and miscellaneous education fees for rural students receiving compulsory education and providing free textbooks to students from poor families and living allowances to poor students living on campus, and constantly expanded the areas covered by the policy. The package of policies designed to assist students from poor families was improved. Effective measures were taken to ensure that children among the floating population have access to education. We accelerated efforts to standardize primary and secondary schools. We set up a program of direct assistance from urban schools to help their rural counterparts to improve operating conditions in rural schools and other schools with poor conditions. Beijing led the way in offering universal higher-education opportunities to its residents, and steady progress was made in making Beijing a city of learning. We put more effort into developing infrastructure for holding cultural activities, staged many popular cultural activities, and set up the framework of the system of public cultural services that covers both urban and rural areas. We worked to foster well-known cultural brand names, focusing on the Beijing Music Festival, Beijing New Year Music Festival and Beijing International Performance Season for Opera, Dance and Music. We took vigorous measures to protect our intangible cultural heritage. We devoted a great deal of effort to reform of the cultural system and accelerated the development of the press and publishing, radio, film and television, literature and the arts, philosophy and the social sciences.
Thanks to the correct leadership of the central authorities, the heroic efforts of municipal and military medical personnel, the combined efforts of all the people of Beijing and the strong support of the people of the whole nation, we were highly successful in combating the outbreak of SARS. We strengthened efforts to prevent and control major diseases such as AIDS and effectively controlled the outbreak of highly pathogenic avian flu. We actively expanded Chinese medicine services. We accelerated the development of the community health service system for urban and rural areas, and finished construction on 167 standard community health service centers and 2,137 community clinics, completing 70% of the planned work. Management of revenue and expenditures for community health service providers was separated. A total of 312 commonly prescribed medicines were purchased in bulk, distributed under a unified plan and sold at cost, reducing the average price of medicines at community clinics by 30%.