Hu was speaking in a rare group interview with foreign reporters, at a time when the world's fourth-largest economy is facing growing pressure from a weakening global economy.

"Uncertainties and destabilising factors in the international environment are increasing," Hu said, speaking to the press exactly one week ahead of the Beijing Olympics.

"China's domestic economy is facing increasing challenges and difficulties," he said.

"We have made clear that our priorities are to... maintain steady and fast economic growth on the one hand, and control excessively growing prices on the other."

The twin emphases on growth creation and inflation control, reiterated by Hu, emerged from a series of high-level meetings by top economic policy makers last month.

When state media reported on these new broad macroeconomic objectives, some observers began speculating that it marked a shift from a more exclusive focus on curbing price rises.

This speculation was fuelled by the most recent central bank monetary policy document, which left out a reference to tight monetary policies that have been in force since late 2007.

China's economic growth slowed to 10.4 percent in the first half of 2008 from 11.9 percent for all of 2007, accompanied by a nearly 12 percent fall in the trade surplus amid weakening foreign demand and a stronger yuan.

Inflation was at 7.9 percent in the first half of 2008, peaking at 8.7 percent in February, and has since lingered near 12-year highs.

Hu said China's economy had tackled challenges such as the worst winter in decades, followed by the most violent earthquake in a generation.

In facing these issues, the Chinese people had been "united as one," Hu said.

The Beijing Olympics have been helpful in bringing growth to the Chinese capital, but it will only be of marginal importance to the national economy as a whole, he said.

"It's true that in preparing for the Games, the economic and social development of Beijing has been greatly boosted," Hu said.

"On the other hand, Beijing's economic aggregate merely accounts for a small portion of the national total. We should not overestimate the boost that the Beijing Games will have on the national economy."

Hu only offered broad outlines on the policies and measures the government will adopt to pursue the objective of high growth without high inflation.

However, he reiterated an interest in environmental protection that has become one of the features of his administration, which took over in late 2002 and early 2003.

"We want to earnestly protect the national environment and make conscientious efforts to conserve energy and control pollution," Hu said.

He said his government would push ahead "comprehensive reform, including political reform," but gave little specific detail other outlining the objective of a socialist democracy under the rule of law.

The thrust of reform would be mostly on raising the efficiency of public administration, Hu suggested.

"We want to strengthen our efforts to reform the administrative system to further enhance efficiency of state organs and improve the state and government services in order to protest the rights and interest of the people," he said.

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