HONG KONG (MarketWatch) — China will target slower economic growth over the next five years than it has in the past five, as part of efforts to improve the quality of that growth and ease inflationary pressures, Premier Wen Jiabao said over the weekend, according to reports.

The country, which displaced Japan as the world’s second largest economy last year, will aim to grow its gross domestic product by 7% annually in the period from 2011 to 2015, compared with its targeted growth of 7.5% in the previous five years, Wen reportedly told internet users in an online chat on Sunday.

China’s GDP target usually serves as a floor for the pace at which the country grows. The nation’s economy steamed ahead at the rate of 11.1% between 2006 and 2010, according to data cited by The Wall Street Journal.

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“This new target should be seen as a signal of Beijing’s intentions over the medium term,” Royal Bank of Canada economists wrote in a note to clients.

The comments were consistent with statements made by officials over several years, highlighting the “need to move China away from a reliance on low-value-added, heavy-polluting industries — often geared to the export market — and to promote greater domestic consumption,” RBC said.

In his comments over the weekend, Wen also said China will punish abuse of power and resist calls that it enable its currency to strengthen sharply, media reports said.

The official said the government would boost grain output, control property prices — by increasing affordable housing and combating speculation — punish the hoarding of goods, and reduce the money supply, reports said.

Meanwhile, online postings were calling for rallies in China, inspired by the revolutions sweeping through the Arab states of the Middle East and North Africa, reports say. Those Mideast revolts reflect public anger at, among other things, soaring food prices and government corruption.

News agencies reported that on Sunday, Chinese police patrolled a major shopping street in Beijing, the area where the protests were called for. In Shanghai, foreign journalists were forced to leave the protest areas or their movements were restricted, the reports said.

Growing inequality threatens stability in Chinese society, Wen was quoted as saying.

China’s consumer price index rose 4.9% in January from a year earlier, less than expected. But the price rises still portended controls on inflation, including interest-rate increases and a stronger currency, some analysts say.

Wen said a stronger yuan is in the interest of the country’s economy and people. But he also said such strengthening must be gradual because a spike in the currency would bankrupt a number of Chinese enterprises.

RBC economists said that while the comments on the currency revaluation were just a reiteration that the yuan moves would be gradual, Wen “also made it clear that he sees the currency moving in only one direction, noting that [yuan] appreciation benefits China’s economy.”

The economists said the yuan’s 20% appreciation against the U.S. dollar between 2008 and 2008 put the business model of low-margin Chinese manufacturers under stress. But at the same time, it also helped “to shift resources into other parts of the economy.”

“Indeed, the extent to which Beijing allows the currency to appreciate in coming years will serve as a key litmus test to how serious policy makers are in rebalancing the economy, though the pace of this process will continue to be affected by external developments,” they said.

China has been accused of keeping the yuan artificially weak to help its exporters. A weaker local currency keeps exported products cheaper for overseas buyers.