Premier Wen Jiabao said Friday China will continue to reform its cultural system and encourage cultural innovation.

In the past year, development and reforms of the cultural industry effectively expanded domestic demand, Wen said at the annual session of the National People's Congress, the top legislature.

"In the new year, we need to pay greater attention to and vigorously promote cultural progress," he said.

China is deepening reforms on its cultural system, such as encouraging state-owned cultural groups to convert to a stake-holding system.

Wen said China can not only create economic miracles, but also make brilliant new cultural achievements.

Culture is the "spirit and soul" of a nation and the "determining factor" of whether it is truly strong or not, he said.

Wen also promised to give priority to developing cultural infrastructure and allocating public cultural resources in rural areas and less developed central and western regions.