Deputies to the 11th NPC listen attentively to the government work report delivered by Premier Wen Jiabao.

Unprecedented challenges

China's economy cooled to a seven-year low of nine percent last year, and broke a five-year streak of double-digit expansion, as the global financial crisis takes its toll on the world's fastest growing economy.

China is under great pressure to actualize the targeted eight-percent growth, which is essential for the populous developing nation, although the country outperformed the target in the previous four years.

The country used to rely heavily on export for growth. Exports contribute to about 40 percent of its gross domestic product (GDP).

A sharp decline in overseas demand has driven the economic growth down to 6.8 percent in the fourth quarter, the worst in nine years, as the global economic turmoil began to spread in the second half of last year.

The engine of export for growth is failing. Statistics showed that exports contributed 0.8 percentage points to last year's growth, compared to a contribution of about three percentage point to a revised annual growth of 13 percent in 2007.

The Premier acknowledged the country is facing "unprecedented difficulties and challenges".

"The global financial crisis continues to spread and get worse," he said, adding 2009 could be "the most difficult year for China's economic development since the beginning of the 21st century."

The Premier said demand would continue to shrink on international markets, adding that Chinese economy is shrouded in increasing uncertainties outside the country.

Last time when the country was confronted by a similar crisis, China's economy expanded by 7.8 percent in 1998, in the wake of the Asian financial crisis.

Some analysts have put their forecasts of 2009 China growth below eight percent. The lowest projection is 5 percent.