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Planner in call for new direction on growth

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Forum told the country has become too reliant on energy-intensive industries

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China's economic growth model was too reliant on energy-intensive industries and the country had to find a more sustainable basis for development, its top economic planner told a high-level government forum yesterday.

Ma Kai, head of the powerful National Development and Reform Commission, challenged an audience of government ministers and international experts attending the opening day of the China Development Forum to come up with fresh ideas for restructuring the economy.

The mainland accounted for 15 per cent of world energy use, but only 5.5 per cent of global gross domestic product, Mr Ma said, adding that its role as a global base for low-cost manufacturing helped explain the consumption rate.

Offsetting the cost of poor energy efficiency, both for financial and environmental reasons, is a top priority for the nation's leadership. China's bill for imported crude oil last year was the world's second-highest after the United States, and the mainland's reliance on coal for its basic energy needs will make it the world's biggest emitter of carbon dioxide next year.

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Meeting government targets to cut energy consumption by 20 per cent by 2010 looks increasingly unlikely. The amount of energy used to generate one unit of GDP fell by a little over 1 per cent last year, far short of the official 4 per cent target.

One problem is that demand for basic construction materials has propelled huge investment in heavy industry, especially metals smelting, oil refining and chemicals production, which are big users of electricity. Generating electricity accounts for half of China's coal use.

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