2. We comprehensively deepened reform and opening up and greatly invigorated the market.

We continued to carry out a range of reforms related to government review and approval, fiscal and tax systems, banking, investment, and pricing. We also increased the pace of reform in education as well as medical and healthcare services. These initiatives enabled us to inject new vitality and impetus into economic and social development. P 1) The reform of the government review and approval system was continued.

Focusing on investment, production, and business operation, we canceled or delegated to lower-level governments the process of government review and approval for 246 items, achieving ahead of schedule the goal of cutting the number of items requiring government review and approval by one third. In addition, we pushed forward comprehensive reforms in the business system, and the number of newly registered market entities for the year totaled 12.93 million.

2) Fiscal, tax, and financial reforms were actively pushed forward.

We formulated and implemented an overall plan for deepening fiscal and tax structural reforms. We extended the trials of replacing business tax with VAT to the railway transportation, postal, and telecommunications services industries, and replaced the quantity-based resource tax on coal with a price-based one. We introduced new measures on the procurement of services by the government. We raised the upper limit on the floating range for deposit interest rates and reduced maturity brackets. We also widened the floating range of the RMB exchange rate, allowing it to float more freely. We methodically approached the lifting of restrictions on the establishment of financial institutions, and approved the establishment of five private banks. The trial-run of the Shanghai and Hong Kong Stock Connect was officially launched. The scale of RMB settlement in cross-border trade and investment increased.

3) Breakthroughs were made in the reform of the investment system.

Major steps were taken to reform the system for the review and approval of investment projects. Further revisions were made to the list of investment projects requiring government review and approval. The number of projects requiring approval at the ministerial level was cut by 76% over the past two years. The system of mandatory government review for all overseas-funded projects was replaced with a reporting-based system under which government review is only required in a limited number of cases. More than 95% of cases were only required to report to the government. With the exception of cases involving sensitive countries, regions, and industries, the requirement that overseas investment projects must be reviewed and approved by the government was replaced with new requirements under which projects only need to be reported online. The number of projects that required government review and approval accounted for less than 2% of the total. A work plan was introduced for reducing the number of items requiring government review and approval, regulating intermediary services for investment projects, and reviewing and approving enterprises' investment projects online. Guidelines were formulated and implemented for revamping the systems of investment and financing in key sectors and encouraging nongovernmental investment. Positive headway was made in the reform of the investment and financing system for railways.

4) Pricing reform was intensified.

We lifted price controls over more than 700 low-priced medicines covered by medical insurance as well as 50 goods and services in other sectors, such as medical services provided by non-public medical institutions and telecommunications services. Railway freight transport prices were changed from being set by the government to being guided by the government and a ceiling was imposed. Unified national railway freight transport prices were raised once again. Benchmark passenger transport prices on domestic air lines were changed from being reviewed and approved by the government to being determined by airline companies in accordance with state pricing rules. We launched pilot projects of guaranteed base prices for cotton produced in Xinjiang and soybeans in northeast China and Inner Mongolia. We carried out trial reforms for the pricing of electricity transmission and distribution on power grids in Shenzhen and western Inner Mongolia. We introduced tiered pricing for residential water and gas consumption and adjusted the price of non-residential natural gas for use that was within 2013 levels.

5) Progress was made in the reform of State-Owned Enterprises (SOEs).

Guidelines for reforming the remuneration system for executives in central government enterprises were introduced. Pilot reforms were launched to reorganize central government enterprises as state-owned asset investment companies, develop a mixed-ownership economy, and standardize the boards of directors in central government enterprises. Further progress was made in the merging and reorganization of SOEs.