'On the agenda at the conference are how to cool off booming investment and bank lending, address the soaring trade surplus and improve the people's livelihood,' unnamed sources told the Xinhua news agency.

While acting to rein in runaway bank lending and control property and factory investment, Beijing needs to keep the economy expanding fast enough to create the jobs and higher incomes needed to boost domestic demand and counter the country's reliance on exports for growth.

The Central Economic Work Conference brings together top decision-makers from the Communist Party and government, Xinhua reported. No timeframe was given, but in the past, the sessions typically lasted three days.

China's economy is expected to expand 11.5 per cent this year, fuelled mainly by investment spending, according to Xinhua. It will be the fifth consecutive year of double-digit growth.

Meanwhile, a government think-tank forecasted economic growth of 10.8 per cent for next year.

Analysts said a set of broad outlines would likely emerge from the meeting, setting the outer limits of policies available to China's huge bureaucracy.

'The priority certainly should be to prevent the economy from overheating,' said economist Li Huiyong of Shenyin Wanguo Securities. 'The government should moderately tighten its fiscal and monetary policies.'

In a prelude to the conference, the Communist Party's 25-member Politburo convened a meeting last week on the challenges for next year.

That meeting also concluded that priorities for next year were to prevent the economy from overheating and to restrict inflation.

China's main inflation benchmark, the Consumer Price Index, was at a decade-long high of 6.5 per cent in October, driven largely by surging food prices. Inflation is likely to hit 4.5 per cent this year, compared with a target of just 3 per cent set for 2007 at the start of the year.

Real estate prices have also soared, though share prices have fallen back in recent weeks after more than doubling since the beginning of the year.

AGENCE FRANCE-PRESSE, ASSOCIATED PRESS