Premier Says China Is in a Critical Time

China's premier on Wednesday extolled the prosperity the Communist government has brought to many Chinese, yet he sounded an alarm that inflation could derail the country's rapid emergence.

The mixed message in Premier Wen Jiabao's annual policy address underscored the problems Chinese leaders face in meeting public expectations for ever rising standards of living.

For the first time in more than a decade, inflation is emerging as a danger at home, potentially eroding incomes of a fledgling middle class and inflaming tensions between the newly rich and the majority low-income workers and farmers. Overseas, the U.S. economic woes and trade friction with Europe could wreck key markets for job-creating export industries.

''All this could adversely affect China's economic development,'' Wen told 2,970 delegates in his address opening the national legislature's annual session. ''China is now in a critical period in its reform and development.''

In a 2 1/2-hour state-of-the-nation speech, Wen ticked off proud achievements since he and Communist Party chief Hu Jintao took office five years ago: China has soared to become the world's No. 4 economy, just behind Germany. Urban incomes rose 80 percent, rural ones by nearly that much.

''There was a great increase in the number of family owned cars and rapid spread in the use of cell phones, computers and Internet services,'' Wen said. ''The number of people going on vacations increased several fold.''

But just as the two-week meeting of the National People's Congress should be celebrating China's middle class and world-power status, the event is unmasking crucial divisions hampering the leadership's ability to tackle inflation and other new challenges.

Unlike the totalitarian days of Mao Zedong, when officials marched in lockstep with Beijing, the Hu-Wen team has been criticized by business executives and ordinary Chinese for being weak, unable to impose policies on local governments and agencies on the cleaning up the environment, and halting land confiscation -- issues increasingly inciting protests.

''In Mao Zedong's day, one soldier could command 10,000. Now 10,000 soldiers cannot command one,'' said Liu Anjun, a campaigner for citizens rights.

Complicating matters, the congress -- a largely powerless body filled with influential politicians and officials -- falls amid a painful leadership transition. At a party conclave last fall, Hu was forced to pass over a favored deputy and accept a compromise candidate as a presumptive successor, Xi Jinping, the son of a now dead party power-broker.

There are signs the cohabitation is not going smoothly, political experts said, with one former Foreign Ministry official likening it to a forced adoption.

Xi was recently given a plum assignment, overseeing final preparations for the greatly anticipated Beijing Olympics. The congress is expected to bring him a step closer to succeeding Hu, anointing him a vice president, a position Hu formerly held. Meanwhile, Hu's protege, Li Keqiang, is expected to be named a vice premier, putting him in the firing line on fighting inflation.

Consumer prices rose 7.1 percent in January, the highest rate in 11 years, led by even higher costs for food and housing. Prices for coal, which feeds two-thirds of the boisterous economy's energy demand, are projected by some economists to double this year.

''The new collective economic leadership team will also be seriously tested in the months and years to come,'' said Cheng Li, an expert on elite Chinese politics at the Brookings Institute in Washington. ''This can be anything but 'smooth.'''

Another signature policy the congress is slated to adopt -- a restructuring of government ministries -- shows signs of being watered down. Wen told the congress Wednesday the streamlining to create a few enlarged ministries and cut down waste would go ahead, though he provided few details.

Already, an influential lawmaker, Cheng Siwei, was quoted on a local Web site as saying the Finance Ministry would not be part of the reorganization. A new Environment Ministry will not be given authority over provincial environmental bureaus.

The worry among policy watchers is that while leaders quibble, inflation may persist and with it the likelihood of social unrest.

''In the past 30 years, every time inflation was high, social protests, political protests were likely to emerge. That's why this issue is the most pressing issue for the Cabinet,'' said Ding Xueliang of the Carnegie Endowment for International Peace in Beijing.

Discontent over soaring food costs fueled the Tiananmen democracy protests that nearly toppled the party in 1989. Wen, who was a senior party official in 1989, on Wednesday called for extending price controls on food and basic goods and for curbing investment to tamp down the demand driving prices higher. He also promised subsidies to encourage farmers to grow more food and protect the poor and pensioners.

''Only by appropriately spreading the fruits of economic development among the people can we win their support and maintain social harmony and stability,'' Wen told the congress.

中国经济正处于关键时期

     中国总理在周三的政府工作报告中指出，尽管共产党政府给不少中国人带来了实惠，但他同时敲响了警钟，指出通货膨胀可能威胁到社会的快速发展。

     温家宝在年度政府工作报告中表示，中国领导人面对的最大问题是满足人们越来越高的生活水准。

     在过去十年以来，通货膨胀第一次成为一个潜在的危险，它将侵蚀新兴的中产阶层和广大低收入人群的生活水平，激化社会矛盾。在国外市场上，美国经济衰退和与欧洲的贸易摩擦可能破坏这两个主要的出口市场，从而影响出口行业的就业机会。

    “所有的这些都将对中国的经济发展产生不利影响，”温家宝在人民代表大会上对2970名代表说，“中国正处于一个改革发展的关键时期。”

     温家宝在两个半小时的全国人民代表大会上讲话时，首先强调了他和共产党总书记胡锦涛上任5年来取得的骄人成就：中国目前已飙升至成为世界第四大经济，仅次于德国。城市和农村居民的收入增长80 ％。“拥有汽车的家庭不断增多，使用手机、电脑和上网服务的用户数量正在快速增加，享受休假的人数提高了数倍。”

     在为期两周的全国人民代表大会上，将重点讨论通货膨胀和其他新的挑战，这对于中国领导人来说是考验其执政能力的关键因素。

     与集权的毛泽东时代不同，那时候全国的官员都能够与北京中央政府保持高度一致。而现在，中央政府的政策很多时候在地方得不到执行，因此胡、温领导团队将会面临各式各样的指责，从环境治理到停止征收土地－－由这些问题引发的抗议也越来越多。

     造成这种混乱的一个关键原因是，中国人民代表大会－－一个实际权利很小的机构里却拥有很多有影响力的政治家和官员－－正处于一个领导层更迭的时期。去年秋天，胡锦涛正式推选习近平为其继任人。

     有迹象显示，这种权利交接并不顺利，一名前外交人士透露，这种安排其实是被迫接受的。

     习近平目前被任命监督奥运会的筹办准备工作。预计他在本次大会上将被选举为中国国家副主席，距离胡锦涛的权利核心又更近了一层，这种人事安排步骤类似于胡锦涛以前走过的道路。与此同时，李克强将被任命为国务院副总理，主管抑制通货膨胀。

     在1月份，中国居民消费价格上涨7.1％ ，创11年以来新高，其中增幅最大的又集中在食品和住房。而一些经济学家认为，作为中国经济主要的能源，今年的煤炭的价格将会翻倍。

     华盛顿的政治智囊机构布鲁金斯学会专家陈立表示：“新的经济领导班子将会在未来几个月甚至几年内受到严重的考验。”

     本次大会还有另一项引人注目的政策－－国家各部委的调整。温家宝在周三的报告中对大部委的政策方针透露了一些细节。

     中国当地网站援引陈思危的话说，财政部将不会被改组，而新成立的环境管理部门将不会对外省的环境部门产生影响。

     让观察家们感到担忧的是，中国领导人明确指出通货膨胀可能会持续下去，并有可能引发社会不安。

     在过去30年里，每一次的高通货膨胀都会因起社会动荡，政治抗议活动时有出现。这也是为什么本次大会上将通货膨胀视为最紧迫的问题，”卡内基国际和平基金会的丁学良说。

     这次大会上，温家宝表示：“只有让广大人民群众享受到经济发展的成果，我们才能赢得他们的支持和维护社会和谐与稳定。”