WASHINGTON - China's new five-year plan shifted to a more spending-driven and more climate-friendly economy to ease trade tensions with the United States and contribute to the fight against climate change, US experts said.

The economic blueprint for this year and through 2015 was unveiled Saturday at the annual sessions of the National People's Congress (NPC) and the National Committee of the Chinese People's Political Consultative Conference (CPPCC).

It aims to propel economic development from the current export-driven economy to a more consumption-powered one with the target of 7 percent annual growth over the next five years.

"Boosting consumer demand in China would be a positive step for China's economy and the many American companies that are selling goods and services in China," said US-China Business Council (USCBC) President John Frisbie in a statement to China Daily.

The USCBC president said the new plan will give more opportunities for American businesses.

In addition to curbing inflation and increasing wages to allow Chinese consumers to spend more, China will invest heavily on social issues, such as welfare, education, research and development, sports and healthcare.

Chinese experts said they expect that China's new plan will help the nation import more and reduce the trade surplus with other major economies, such as the US.

"With only 36 percent of China's economy presently dedicated to consumer spending, steps to increase this number would better balance trade between our countries and provide more opportunities for American businesses over the coming years," according to Frisbie's statement.

Philip Levy, resident scholar with the American Enterprise Institute, said if China were to shift toward an economy driven more by domestic consumption, it would be beneficial for the Chinese people and to "global rebalancing".

"Such a move would very likely reduce tensions with major trading partners," he said in an interview. "Politically, the US would need to distinguish between the economically meaningless bilateral trade imbalance, which would likely remain, and the much more meaningful global balances. But that's a manageable distinction."

But Derek Scissors, with the Heritage Foundation, is more cautious about Beijing's claim of rebalancing its economy.

The gap between investment and consumption has widened every year since 2004, he said, and "the most obvious way to lower investment growth down is to permit full interest rate liberalization, but Premier Wen (Jiabao) again dismissed this idea."

But Wen did stress the goal of a more sustainable model of development, which climate experts said is an encouraging move.

Deborah Seligsohn, World Resources Institute special adviser on climate and energy, and Angel Hsu, at the Yale School of Forestry and Environmental Studies, said they are impressed with Wen's work report and the energy targets in the new five-year plan.

"The mention of key targets, including for major pollutants, is really important," they said in an e-mail to China Daily. "The range of policies endorsed is significant and the fact that the government is planning to strengthen the monitoring systems to ensure the policies are implemented is important for China's clean development. It's significant not just for energy and CO2, but also for major pollutants."

The plan said the proportion of non-fossil fuels in primary energy consumption will reach 11.4 percent; energy consumption and CO2 emissions per unit of GDP should be reduced by 16 percent and 17 percent; and the release of major pollutants should be reduced by 8 to 10 percent.

They also noticed that both energy and climate targets in the plan were within the range expected and congruent with the 40 to 45 percent reduction in carbon intensity that was first announced in Copenhagen and reaffirmed in Cancun.

"It's clear from the range of policies endorsed in the plan that the Chinese government takes energy and environment issues very serious and is planning to do a great deal of work under this new plan," they said.

But there were some targets expected by the Chinese press that were not included, such as air pollutant targets and a total energy cap.

"We'll be looking to see whether these are included in the individual ministry plans," they said.

China Daily