Archive for January, 2008

Prudent policy pledged; social sector to get boost

    BEIJING, Dec. 20 — The Ministry of Finance has pledged to adopt a prudent fiscal policy to help cool the economy and prevent excessive price rises.

    The authorities will also make efforts to improve people’s well-being by supporting such sectors as social security, health, education and housing, Xie Xuren, minister of finance, told a meeting yesterday in Beijing.

    The country will “properly” reduce the budget deficit, he said. Last year, the central government deficit was 274.9 billion yuan (37.3 billion U.S. dollars), or 1.37 percent of gross domestic product. It is budgeted to drop to 1.1 percent this year.

    The issuance of long-term construction bonds will be cut, which will help the central government’s drive to prevent the economy from overheating and rising prices from evolving into entrenched inflation – a platform hammered out at the Central Economic Work Conference held earlier this month, Xie told heads of the nation’s local fiscal departments.

    The government started to issue long-term construction bonds, or bonds for large-scale infrastructure projects, in the wake of the 1997-98 Asian financial crisis to sustain economic growth.

    But with the economy growing briskly in recent years – and even facing the risk of overheating – the central government has gradually cut the scale of such bonds to avoid jazzing up already-fast investment growth.

    As a result, the issuance of such bonds has been cut from 150 billion yuan (20.4 billion U.S. dollars) in 2002 to 60 billion yuan (8.1 billion U.S. dollars) last year.

    Xie vowed to further use fiscal policy to stabilize rising prices.

    ”(We) will actively support production of agricultural products such as grain, edible oil and meat, and ensure the supply of basic daily necessities to curb excessive price rises.”

    Subsidies will be extended to those hit hard by rising prices timely, he added.

    The consumer price index, a key gauge of inflation, rose to a decade high of 6.9 percent in November, the fourth consecutive month when it exceeded 6 percent.

    Xie said more funds would be pumped into the health sector, and the rural cooperative medical insurance system, which now covers 730 million farmers in 86 percent of all counties nationwide, would be expanded.

    In the first 11 months, the central and local fiscal expenditure on health amounted to 142 billion yuan (19.3 billion U.S. dollars), up 40.6 percent year on year, Xie said.

    Fiscal revenue grew by 33.5 percent year-on-year in the first 11 months to reach 4.8 trillion yuan (651 billion U.S. dollars) and is expected to hit 5.1 trillion yuan (689 billion U.S. dollars) for the whole year, 31 percent more than in 2006, the finance minister said.

    Expenditure in education increased by 32.7 percent during the January-November period, while social security and employment expenditure grew by 28.6 percent.

    (Source: China Daily)

China and Arabic countries forge economic strategic partnership

    By Xinhua writers Jiang Xufeng and Chen Yong

    BEIJING, Dec. 19 (Xinhua) — With the New Year just around the corner, Dr. Maen Nsour, CEO of the Jordan Investment Board (JIB) came to Beijing, his third Chinese tour this year seeking investment and cooperation opportunities.

    As head of the highest Jordanian government authority in charge of investment affairs, he had previously introduced nearly 20 large-scale projects – including the Aqaba port relocation and development program – to Chinese investors and officials in Beijing, and the cities of Shanghai and Guangzhou.

    China’s importance to the Arab world is demonstrated by the string of top level officials who visited in 2007. Iraqi President Jalal Talabani, Chairman of Oman’s State Council Yahya Bin Mahfoodh Bin Salim Al-Manthri, Jordanian King Abdullah II all made the long journey to Beijing.

    ”We believe that Arab countries and China have achieved great progress in economic cooperation, especially in the energy sector,” Omani Ambassador to China Abdullah Saleh Al Saadi told Xinhua.

    He said bilateral trade and investment had reached a satisfactory level between China and Oman. Official statistics revealed that the Sino-Omani trade, 90 percent of which is related to oil, stood at 6.47 billion U.S. dollars in 2006, up 49.4 year border=”0″>

China’s fiscal revenue grows rapidly on economic strength, improved collection

    BEIJING, Dec. 19 (Xinhua) — China’s central and local governments recorded 4.82 trillion yuan (654 billion U.S. dollars) in fiscal revenue during the first 11 months of this year, up 33.5percent from the same period of last year.

    Revenue was 9.3 percent higher than the annual budget, Finance Minister Xie Xuren said Wednesday.

    However, revenue and spending patterns diverged at the central and local levels. While central government revenue grew faster, local government spending expanded more rapidly.

    The 11-month revenue total was 2.69 trillion yuan for the central government, up 37 percent, and 2.13 trillion yuan for local governments, up 29.4 percent, Xie added.

    He forecasted the revenue for the whole year of 2007 would surge 31 percent year-on-year to hit 5.1 trillion yuan.

    Xie attributed the higher revenue to the rapid, stable growth of the economy, favorable conditions for the structure and efficiency of the economy, and better collection practices.

    According to Xie, the first 11 months saw fiscal expenditure amount to 3.71 trillion yuan, up 25.2 percent. The total included 886 billion yuan by the central government, up 16.2 percent, and 2.82 trillion yuan by local governments, up 28.4 percent.

    By expenditure category, 236 billion yuan was used for agricultural, forestry and water supply projects, up 31.4 percent, 557.8 billion yuan for education, up 32.7 percent, and 141.9 billion yuan for health and medical care, up 40.6 percent. Another412.8 billion yuan went to social welfare projects, up 28.6 percent and 117.4 billion yuan to scientific research, up 33 percent.

    The government will spread free nine-year compulsory education currently enjoyed by 150 million rural children to their urban counterpart in the coming 2008.

    China will maintain its prudent fiscal policy next year, according to the key Central Economic Work Conference held in early December.

    Xie told a national financial work conference held Wednesday that fiscal policy was an important means of macroeconomic control.

    He said that economic forecasting, monitoring and analysis should be improved and that fiscal policy should be guided by trends in economic development. He added that a variety of tools — taxation, budgeting, treasury bonds and government procurement — should be used to stabilize economic growth.

    According to Xie, next year China will narrow its fiscal deficit and cut the volume of treasury bonds issued for long-term construction projects. Central government capital spending will focus on improving production and living conditions in rural areas, environmental protection and support for social projects.

    The central fiscal deficit was set at 245 billion yuan for 2007,down 50 billion yuan from 2006, and treasury bond issues intended for long-term construction projects were set at 50 billion yuan, down 10 billion yuan.

    He said that next year, spending would also rise for education, scientific research, housing, energy conservation and emissions reduction and public security.

    Fiscal leverage would be used to support the production of grain, edible oil and meat and other agricultural products to ensure supplies and curb inflation. Food prices constitute 33 percent of China’s consumer price index, which rose by an 11-year-high of 6.9 percent in November.

    The government will continue next year to adjust export rebates and tariffs to curb exports of resources products and products whose production involves more energy consumption and pollutants emissions, said the Finance Minister.

    The government will also encourage export of high value-added products and imports of energy-saving and pollution-reducing equipments, he added.

    China has vowed to reduce the energy consumption per unit of gross domestic product (GDP) by 20 percent and major pollutants emissions by ten percent between 2006 and 2010.

    Its energy consumption per unit of GDP dropped three percent year-on-year in the first three quarters of 2007. Sulfur dioxide emissions fell 1.81 percent and chemical oxygen demand (a measure of water pollution) dropped 0.28 percent in the same period.

“Plan of Revitalizing Northeast China” released

    BEIJING, Dec. 19 (Xinhuanet) – Office of the Leading Group for Revitalizing Northeast China and Other Old Industrial Bases of the State Council, People’s Republic of China, released an English version of “Plan of Revitalizing Northeast China”>Column 1    Major Planning Indicators of Northeast China during the 11^th Five-Year Plan Period

Types

Indicators

2005

2010

Annual Growth Rate (%)

Classification

Economic Growth

Per capita GDP (Yuan)

15318

21889

7.4

Anticipatory

Comprehensive Grain Production Capacity

(Ten thousand tons)

8614

9450

1.9

Anticipatory

Economic Structure

Ratio of Tertiary Industry to Regional GDP (%)

38

41

[3]

Anticipatory

Ratio of Valued-added of Non-public Sector to Regional GDP (%)

36

48

[12]

Anticipatory

Ratio of R&D Expenditures to Regional GDP (%)

1.3

2

[0.7]

Anticipatory

Urbanization Level (%)

52

55

[3]

Anticipatory

Resources and Environment

Reduction of Energy Consumption Per Unit of Regional GDP (%)

[20]

Obligatory

Reduction of Water Consumption Per Unit of Industrial Value-added (%)

[30]

Obligatory

Stock of

Cultivated Land

(10 thousand hectare)

2548

2553

[0.2]

Obligatory

Reduction of Major Pollutants (%)

[10]

Obligatory

Utilization Rate of Industrial Solid Waste (%)

51.9

>60

[8.1]

Obligatory

Forest Coverage (%)

34

38

[4]

Obligatory

Social Development

Registered Urban Unemployment Ratio (%)

4.2

<5

[0.8]

Anticipatory

Population Covered by  Basic Pension System in Urban Areas  (%)

2550

3270

5.1

Obligatory

Coverage of New Rural Cooperative Medical System (%)

>80

Obligatory

Average Schooling Years (Year)

9

10

[1.0]

Anticipatory

    Note: data in parenthesis is the sum number in five years

    Section III Promote Upgrading of Industrial Structure

    In the course of revitalizing Northeast China, we should adopt new models for industrial development, help businesses to play a major role and be market- oriented, strengthen their independent innovation capability and change the pattern of economic growth. Competitive industries must become more competent by using advanced technologies. We must cultivate new industries, support labor-intensive industries, and establish new industrial bases through structural and layout adjustment.

    3.1 Build a base for manufacturing advanced equipment

    By using information technologies, intelligent and integrated technologies, we must advance the independent innovation capabilities and system integration capabilities of businesses, and raise localization content and international competitiveness in major equipments manufacturing. Northeast China is expected to be built into an internationally competitive manufacturing base of heavy machinery and large complete set equipment, a global leading R&D and manufacturing base for digital machine tools and components, a state R&D and manufacturing base for power generation, transmission and transformation equipment, a strategic manufacturing and export base of complete vehicles, parts and components, a world-leading shipbuilding base as well as a state manufacturing base for rail transportation equipment.

Column 2     Priorities of Revitalizing Equipment Manufacturing Industry

Digital machine tool: integrated products such as high-speed digital-controlled machine tool, digital-controlled milling and boring machine, high-speed vertical machining center, planer-type pentahedral machine center, multi-axis machining center, turning-milling machining center and flexible automatic production line, flexible manufacturing system and intelligent manufacturing system, etc.

Large complete set equipment for oil refinery and ethylene manufacturing: 10-million-ton oil refinery equipment, complete-set equipment for manufacturing 1-million-ton ethylene, PX, PTA, PVC and polyester.

Large complete set equipment for chemical processing of coal: large centrifugal compressor, 1250KN compressor for coal liquefaction project.

Large metallurgical equipment: new-generation complete set short-route equipment for sheet metal concasting and constant rolling, large complete set sintering equipment.

Large power generation equipment: Large hydropower generation units, large thermal power generation units with high efficiency and low pollution, megawatt nuclear power generation units, heavy gas turbine, IGCC(integrated gas-steam combined cycle) units, forging and casting components for large power-generation equipment, complete set power station auxiliary equipment, large air-cooling units and wind turbine units.

       Ultra-high voltage/Extra-high voltage power  transmission and transformation equipment: 500 kv AC/DC complete set power transmission and transformation equipment, 750 kv AC complete set power transmission and transformation equipment, step up development in 1000kv AC ultra high voltage and ±800 kv DC transmission and transformation equipment.

       Other large complete set machinery equipments: full face tunnel boring machine, large complete set equipment for cement manufacturing, port loading and unloading equipment, large lifting equipment, centrifugal compressor units and air-cooling equipment, large-volume oil-pump with high efficiency and adjustable speed, high temperature and high pressure large vessel and heat exchanger reciprocal compressor.

       Large vessel equipment : 300,000-toncrude oil carrier, large and super large container vessel, roll >       Rail transport equipment: 200 km/h high-speed rail and rail above 200km/h, high-power AC-drive electric locomotive, internal-combustion locomotive and core technologies of novel subway vehicles.

    3.2 Speed up development of high-tech industry

    We must launch a number of high-tech projects>Column 3     Priorities in construction of power grids and natural gas pipeline network

Power grids construction: power transmission line linking Hulunbeier and central Liaoning province, 500 kv AC transmission line connecting coal-powered bases in both Huolinhe and Chifeng and load centers in Liaoning province, 500 kv parallel power transmission line linking Heilongjiang and Jilin provinces, as well as the 4^th parallel line for 500 kv power transmission between Jilin and Liaoning provinces.

Natural gas pipeline network project: the trunk natural gas pipe line linking Harbin, Changchun, Shenyang, and Tangshan, ten branch lines linking Daqing and Harbin, Changling, Changchun and Jilin, Zhuaji and Harbin, Dalian and Shenyang, Daqing and Qiqihaer, etc.

    3.4 Uplift basic and raw materials industry

    We must step up efforts in eliminating backward productivities, optimize industrial structure and spatial layout, control the total output and explore intensive and precision processing. Therefore, we must strive to shift from expansion-based growth to efficiency-based growth. The major tasks are as follows: first, to establish new-type petrochemical industrial base, with focus>Column 4 Priorities of Agricultural Development

Irrigation and drainage facilities construction: to increase inputs in supporting facilities and renovating water-saving projects in irrigated areas, and initiate planning and construction of some new irrigated areas when time is appropriate in areas along Heilong River, Wusuli River and Xinkai Lake, where quality water sources abound.

Transformation of low-and-middle yielding farmlands:  to conduct soil erosion control and soil fertility improvement in the Songnen Plain with black soils, transform barren and water logged low-and-middle yielding farmlands in Sanjiang Plain, improve saline-alkali land and wind-induced sandy land in the western part of Songnen Plain, as well as water-logged and saline-alkali land in northeast Liao River plan with brown soils.

Construction of large-scale agricultural and animal husbandry bases with high-quality products: establish large state commercial grain bases, high-quality animal husbandry production base, high-quality aquatic products breeding and production base, and develop special resources in an all-round way.

Agricultural mechanization: promote complete mechanization in maize and paddy rice production, strengthen service network for agro-machines and train personnel for maintaining and operating agricultural machinery.

Supporting system development: to enhance protection of animals and plants, cultivate improved strains in agriculture and animal husbandry, popularize science and technologies while promote information services and establish certification center for assessing qualities of farm produce.

Rural infrastructure development: to speed up construction of rural roads and grassland fences in pasture areas, ensure water safety and develop rural energy. Public facilities of education, culture, healthcare, medical, etc, will also be strengthened.

    Section V Actively Develop Tertiary Industry

    We must foster the development of tertiary industry by following market-orientation, expanding industrialization and encouraging socialized services. We must establish modern service system by relying>Column 5   Priorities of Tourism Development

Winter sports tourism: to build winter sports bases in Harbin province and Jilin provinces, etc. We must develop high-latitude skiing programs, mountain winter sports tourism and winter recreational programs.

Forest, steppe and wetland tourism: to give priorities to the development of forest tourism in Daxinganling Mountains and Xiaoxinganling Mountains, Changbai Mountain and eastern Liaoning Provinces, sight-seeing and folk tourism in the grasslands of Hulunbeier, Xilinguole, Keerqin, as well as wetland ecological tourism in Sanjiang Plain, Songnen Plain, downstream plain of Liao River, and Daxinganling Mountains, etc.

Volcano and hot spring tourism: with effective ecological protection, to actively develop programs such as volcano landform sight-seeing, volcanic lake sight-seeing, scientific expedition, mineral spring tourism and  leisure tourism, etc in Changbai Mountain of Jilin, Wudalianchi of Heilongjiang and Ar Mountain of Inner Mongolia.

Industrial tourism: to explore cultural legacies in old industrial bases which are most representative and are mirrors of regional development. Focuses will be>Agricultural tourism: by relying>Cultural and historic tourism: to develop world renowned tourism programs with distinctive local cultural characteristics by core sites, such as Hongshan cultural heritage, Gaogouli relics, relics of Bohai country, “One palace and Three tombs” in Shenyang which are world cultural heritage under the protection of state.

Border tourism: to develop border tourism in key border cities, such as Dandong, Huichun, Suifenhe, Heihe, Manzhouli, and Erenhot, simplify custom clearance procedures and enrich contents in border tourism. 

Coastal tourism: to fully utilize coastal tourism resources, promote sight-seeing and leisure tourism in coastal areas.

    Section Six Coordinate Regional and Urban-Rural Development

    We must guide division of labor among regions, encourage regional cooperation, strengthen inter-regional key infrastructure construction, coordinate balanced development between urban and rural areas and create new growth engines. A new regional development framework pattern featured by interconnected key cities and their constant interaction with surrounding hinterland must be formed, and sustainable growth of resources-based cities must be promoted.

    6.1 Optimize regional spatial structure

    First, Harbin and Dalian and coastal economic belt all together form a first-grade axis, the advantages of which must be explored. Based>Column 6

Some of the Restricted and Prohibited Development Zones in Northeast China

Restricted development zones:

Forest ecological functional zones in Daxinganling Mountains, Xiaoxinganling mountains and Changbai Mountain—Forest harvesting for non-protective purposes is prohibited, and natural forest protection project must be implemented. Development of this functional zone must concentrate> 

Wetland ecology functional zones in Sanjiang Plain—Protection zones must be enlarged and the intensity of agriculture and urban development must be within control.

Wetland ecological environment must be improved and agriculture and industries with distinctions must be developed.

Desertification control zones in Hulunbeier grassland, Kerqin and Hunshandake ——Excessive land reclamation, inappropriate felling and over-grazing must be prohibited and necessary prevention and control measures must be implemented. Township development must be highlighted and competitive local special industries must be fostered.

Prohibited development zones: 50 state natural reserves, 5 world culture and natural heritages, 16 state key tourist attractions, 108 national forestry parks and 12 national geological parks are included in this class.

    6.2 Promote balanced development between urban and rural areas

    We must promote balanced development between urban and rural areas and speed up urbanization in line with the principles of “industries back-feeding agricultural development and urban areas supporting rural areas” and “giving more, taking less, and loosening control”.

    Development of county economy must be promoted. We must develop distinctive industries and competitive industries based>Column 7  Planned Transportation Projects in Northeast China

Railway construction:  to construct Harbin-Dalian passenger line, Changchun-Jilin inter-city rail transit, Yimin-Yirshi railway, Chifeng-Daban-Baiyinhua railway, Wulanhot-Huolinhe-Xilinhot railway, Fuxin-West Ujimqin league railway, railway corridor in the eastern part of the Northeast, and container load centers in Harbin, Shenyang and Dalian; to transform Hailar-Manzhouli, Baicheng-Arshan, Huolinhe-Tongliao, Jinzhou-Qiqihar, Jinzhou-Chengde, Shenyang-Jilin, Shenyang-Dandong, Yebaishou-Chifeng, Changchun-Tumen railways, etc.

Expressway construction: to construct expressways of Suifenhe-Manzhouli, Hegang-Dalian,Huichun-Wulanhot,Daqing-Tongliao-Chifeng-Chengde,Changchun-Shuangliao-Fuxin-Chaoyang-Chengde,Dandong-Xilinhot,Tongliao-Shenyang,Jilin-Shenyang, Jilin-Heihe, which are all key components in national expressway network plan.

Port construction: to transform the 3^rd and 4^th phases of Dayao container ports, old ports and eastern ports in Dalian, and expand Yingkou port, Dandong port and Jinzhou port.

Airport construction: to expand and improve airports of Dalian, Shenyang, Changchun, and Harbin, as well as build new airports in Changbai Mountain, northwestern part of Jilin province, Mohe, Daqing, Jixi, Yichun, Arshan and Erenhot.

    We must step up the construction of information infrastructure and accelerate the establishment of integrated information system in Northeast China. Integrated information application systems, such as E-government, e-commerce, distance education and distance medicare must be promoted. Cultural information sharing project must be implemented and by support from universities and research institutes. Northeast science, technology and education information network must be built and information-sharing with advanced regions must be strengthened.

    6.4 Promote sustainable development of resource-based cities

    To promote comprehensive, coordinated and sustainable development in resource-based cities, we will aim at creating jobs, eliminating poverty, improving people’s livelihood and housing environment, setting up functional social security system, and maintaining social stability. By expanding reform and opening up, as well as promoting independent innovation, we must make strong policies and measures to improve institutions and systems, promote industrial upgrading and transformation of economic growth mode, cultivate alternative industries and improve ecological environment.

    We must establish long-term incentive mechanisms: first, to establish compensation mechanism for resource exploitation. When exploiting resources, behaviors of various market entities must follow market principles, assume responsibility for resources compensation, ecological environment protection and rehabilitation and be regulated by legal, economic and necessary administrative means. Secondly, to establish aiding mechanisms for sun-setting industries. We must carry out overall planning, accelerate industrial restructuring and upgrading, and vigorously develop alternative industries to transfer surplus labor. Social security system must be improved and various vocational training must be rolled out to help laid-off workers get reemployed. We must solve historically inherited problems in resource enterprises and ensure smooth exit of resources-depleted enterprises and promote social stability.

    Moreover, we shall vigorously develop succeeding or alternative industries following market guidance and make businesses play a major role in this process. For cities with stable output in resources exploitation, we must formulate rational exploitation plans, improve resource recovery efficiency by using new techniques and processing methods and improve resources utilization efficiency by developing upstream and downstream industries, thus translating resources advantages into economic competitiveness. We must also encourage the development of new industries. For cities with declining output in resources, we must enhance comprehensive appraisal of resources, fully explore secondary resources, expand resources prospecting in other regions and overseas so as to find sources of resources for local enterprises. In the meantime, we must speed up the establishment of alternative industries with great potential and strong competitiveness. As for the resource-depleted cities, the focus is to shift orientation of industries, transform traditional industries by using high and new technologies, and form new leading industries tapping>Column 8 Major tasks of pilot reform of economic transformation in Six Resource-based Cities

Fuxin City: to promote agriculture and farm produce processing industries, develop alternative industries based>Column 9     Major Programs of Talent Development in Northeast China

Pairing exchange program of entrepreneurs: to send a number of excellent entrepreneurs selected from enterprises owned by central government in coastal regions to work in enterprises in the Northeast and vice versa.

High-level innovative talents training program: to help growth of young and middle-aged academic leaders in Northeast China by programs like “the new century national hundred, thousand and ten thousand talent projects”, “Cheung Kong scholars program” and “Innovative research team program in universities”, etc.

“Northeastern Spring” talent project: to train a number of academic leaders, key technicians and new industrial talents by relying>Project for training urgently needed professionals: to accelerate training of urgently-needed professionals in major industries of old industrial bases by relaying>  “985 project”, “211 project” and “Innovation project of graduate education”, etc.  

Skilled talent training project: to establish a number of skilled talent training bases with emphasis>Program for training farmers with practical skills: to train farmers and migrant workers in Northeast China by relying>

    7.2 Enlarge employment and build a sound social security system

    We will go all out to create employment. Development of labor-intensive industries, tertiary industries and SMEs of various ownership types must be encouraged. We will encourage people to seek job>Column 10   Priorities of Ecological Development in Northeast China

Treatment of Kerqin sandy land: to construct sand-blocking ecological belt, composite ecological shelter, and integrated forest-grass-pasture ecological economic system; to treat   declining sylvestris forest and establish small water-and-soil conservation and storage project in arid areas.

Treatment of sources of sandy wind in Beijing and Tianjin: to enclose desertification land and protect it, to nurture forest and grasses which are windbreakers and sand-binding, to harness grasslands, and implement migration programs for environment protection.

Comprehensive treatment of black soil area: to strengthen comprehensive treatment of soil erosion, improve the shelter forest system for farmland protection, restore vegetation in grassland, and improve fertility of black land and prevent nonpoint source pollution.

Protection and development of natural forest: to protect current forest, strengthen cultivation of forest resources and develop forest economy; to strengthen growth of succeeding industries, enhance comprehensive utilization of timber and its processing.

Pasture for grass in natural grasslands program: to push forward the project of pasture for grass project in key grass degradation zones of eastern Inner Mongolia and other places, strengthen the comprehensive treatment of problematic grasslands, transform the traditional grazing mode, construct high-yield artificial grassland and feeder bases, and implement confinement feeding.

Ecological restoration and treatment in mining districts: to combine engineering, biological measures and comprehensive utilization of waste to harness soil erosion, and  continue to implement restoration project in mining-induced subsistence areas and environmental protection project in mining mountains.

Wetland protection and restoration: should strengthen the protection of wetland resources and biological diversity in Sanjiang and Songnen plains, carry out pilot projects of wetland restoration, and implement resettlement project in wetlands.

Marine ecological protection: to strengthen the protection of marine resources, biological diversity and environment, and initiate pilot projects for marine ecological restoration.

    Moreover, we must strengthen energy-saving, emission reduction and environment protection. In particular, we must push forward the water pollution prevention programs of Songhua River and Liao River, strengthen the protection and treatment of drinking water sources for large and medium sized cities with centralized water supply, enhance the rate of urban sewage treatment to above 70 percent and decontamination rate of urban refuse to above 60 percent, strengthen industrial pollution prevention, push forward the construction of desulfurization in power plants, elevate the rate of comprehensive use of industrial solid waste to above 60 percent and the rate of water recycling in industrial use to above 90 percent, and initiate environmental protection action program for the purpose of achieving rural moderately well-being.

Column 11   Priorities of Environmental Pollution Treatment in Northeast China

Protection and treatment of drinking water sources: to strictly define the protection zone for drinking water sources, improve environmental monitoring system for drinking water, publish water quality information>Water pollution control in Liao River valley: to push forward clean production, reduce further the total emission industrial waste, to accelerate the construction of urban sewage treatment plants and garbage treatment plant, advocate water recycling, and strengthen waste pollution in large scale fowl and livestock breeding industry, and actively eliminate agricultural nonpoint pollution.

Water pollution control in Songhua River valley: to strengthen industrial waste control, avoid serious accident, and accelerate pollution treatment facilities infrastructure urban areas

Regional air pollution control: to pay special attention to the desulfurization of coal-fired power plants and emission reduction of auto-exhaust. City clusters in central Liaoning province will be a key area. We will decompose the pollution control targets among different cities, strengthen industrial pollution prevention and control, and initiate relocation and transformation of heavy polluting businesses in densely populated urban areas.

    We will actively promote recycling economy. Pilot project of enforcing recycling economy in businesses, industrial parks and governments must be initiated, with focus>Column 12  Hydraulic Engineering Projects in Northeast China

Large water control and diversion projects: to complete the construction of water diversion project at Dahuofang reservoir, water control projects at Xishan reservoir and Laolongkou water conservancy project; to build water control and diversion project at Sanwan, and the second phase of water project at Taoshan reservoir, and water project at Qinglongshan reservoir; to complete preparation work for water projects as Hadashan hydrojunction, Jinling reservoir, water conservancy project at Bila river estuary, Qingshan reservoir, water transfer from Songhua River to supply city clusters Jilin province, from Nen River to Baicheng City, and water supply project in Dalian City and so>Irrigated area projects: to finish the expansion project of Nirji water conservancy project for diverting water from Nen river, and make preparation for projects in large irrigated area in Sanjiang, Songnen and Liao River plains and kick off these projects when time is ripe, etc.

    Moreover, we will exploit ore resources in an orderly way, reinforce the coordinated planning of mineral resources survey and exploitation, step up certification and authorization management. Prospecting activities of oil and natural gas in Songnen Plain as well as nonferrous metals, precious metal, underground water and other important non-metal resources in Daxinganling Mountains, Xiaoxinganling Mountains, Changbai Mountain and other surrouding places will be more frequent. We will initiate pilot project in Wengquangou of Fengcheng City in Liaoning province for integrated development of iron-boron mine, raise the recovery rate and integrate utilization rate of mineral resources, push forward the recycling of industrial residue and tailing minerals, improve mineral resources development management system by allocating according to law the prospecting rights and exploiting rights. We must establish mineral rights trading system, improve exploration system with explorers paying at price and compensation mechanism for environmental restoration in mining areas.

    Furthermore, we shall make rational use of forest and grassland resources. We must strengthen the protection of natural forests in Daxinganling Mountains, Xiaoxinganling Mountains, Changbai Mountain and scientifically renew resources of “Three North Shelterbelts” so as to ensure that forestry resources are growing faster than the amount reduced by felling. We must establish state strategic bases for timber reserve, make rational use of and protect natural pastures in Hulunbeier and Xilinguole, etc, prevent excessive grazing, and restore fertility and ecological functions of grasslands.

    Last but not least, we shall protect and explore marine resources. We must actively develop marine oil and natural gas resources, thermal energy and sea water chemical resources. Excessive fishing near shore must be strictly prohibited and dynamic balance of biological resources must be kept. We must ensure that aquaculture development in shallow sea must not exceed sustaining capacity of marine environment, control the land reclaiming activities, and exercise treatment of coastal areas. Exploitation of marine sand must be restricted, and management of strand wetland, islands and marine natural reserves must be enhanced to maintain a sound ecological system in coastal area.

    Section VIII Enhance Development Vitality

    We will push forward institutional reforms and procedural innovations to create stimulus from inside, open up wider to propel development and enhance independent innovation to build up competitive capabilities. By making key breakthroughs and achieving synergy in development, we will accelerate momentum in revitalizing the Northeast.

    8.1 Accelerate institutional reforms and procedural innovations

    First, we shall accelerate administrative management system reforms. We will push forward the separation of government functions from enterprise and separation of government from asset management functions. Over－intervention of government in economic activities must be reversed completely and more economic and legal measures must be applied in regulating economy. In places where conditions permit, we will initiate reform of “county directly administered by provincial government”.

    SOEs reforms must be deepened. We must facilitate the concentration of state assets in key areas, industries and enterprises that are of vital importance to economic development and state security. We must promote key industries to restructure with diversified ownership and cross-regional cooperation. We must promote reforms in businesses to separate their auxiliary departments from core business, reform ownership of these auxiliary departments and separate social functions from businesses. We must actively push forward the trial restructuring of SOEs-affiliated collective enterprises, and accelerate the reforms of state-owned forest district through the above-mentioned initiatives.

    Moreover, we will develop non-public economic sector in a vigorous manner. We will treat non-public enterprises as equals with SOEs and carry out supporting policies in market entry, import and export, land use, lending, issue of enterprise bond, etc. Private investment must be allowed to participate in SOEs restructuring by various forms and enjoy equal status with SOEs in non-performing loans write-offs, interests reduction, land use and other tax and credit policies.

    Modern market system must be improved. We will set up property rights market oriented toward the Northeast, based>Column 13 Construction of Port Corridors

Priorities of construction should be given to railway from Suifenhe to Vladivostock, from Huichun to Kamesova at the border with Russia, railway from Arshan to Qiaobashan at the border with Mongolia, and Nanping port for transportation of iron ore powder, as well as railway from Mudanjiang to Luojin at the border with North Korea.

    8.3 Actively promote independent innovation

    We must help enterprises to become major players in technological innovation. In areas of equipment manufacturing, petrochemical, biological engineering, medicine, new materials, etc, we must encourage enterprises to set up technical centers, high-level laboratories, engineering centers and test bases, thus providing impetus to make breakthroughs and promote application of technologies.

    Independent innovative capabilities must be built up. To improve independent innovation capabilities and stimulate sharing of resources, we must reinforce scientific research facilities, integrate scientific experimentation and research systems and establish leading bases for researches and talents training. Among others, we must establish platforms, networks and systems for technological innovation in key fields and implement key projects.

    Innovative mechanisms must be strengthened. We shall perfect the comprehensive policy systems for transferring and commercializing science and technological results. To support independent innovation, we must form relatively advanced venture capital investment system in science and technology by establishing relative input mechanism, encourage original innovation and commercially viable technological innovation, and strengthen the protection of intellectual property rights.

    We must increase inputs in independent innovation. We must support basic researches, frontier high-tech researches, and researches for public good. We pledge to ensure that the outlays of provincial governments for technological development should increase much faster than the increase rate of their regular revenues. We must encourage local governments to provide special funds for the commercialization of technical progress and innovation of SMEs.

Column 14 Technological Innovation System in Northeast China

Five major platforms for technological innovation

Industrial technological innovation platform: construction of engineering centers in equipment manufacturing, petrochemical, quality steel, automobile, photoelectricity engineering, medicine and modern agriculture.

Platform for applying basic researches: construction of laboratories in industries of nano materials, cleaner energy, optical, mechanical and electronic integration, robot, aerospace, biological medicine engineering and so>Incubator platform for scientific and technological enterprises: construction of incubators in software, photoelectronics, biomedicine, new materials, fine chemicals, new-type environmental protection, modern agriculture and so>Platform for scientific and technological innovation service: to establish socialized and networked intermediary service systems for science and technology.

International science and technology cooperation platform: to establish demonstration bases for international science and technology cooperation.

Two networks for science and technological collaboration

Cooperation and sharing network of large scientific instruments in Northeast China: to construct and share large scientific instruments, equipment and facilities.

Information resource service and sharing network of scientific and technological literature in Northeast China: construction of scientific and technological databases, information network as well as fast and efficient decision-supporting system.

Two scientific and technological market systems

Scientific and technological talents market: to establish scientific and technological talents information network and share information and resources within the region.

Transaction market of technical patents: to establish technical patents rules, management methods, transaction modes, monitoring system, transaction dispute settlement system commonly recognized in the region.

    Section IX Policy Measures and Implementation Mechanisms

    Focusing on objectives and major tasks listed above, we must improve polices and measures and relevant implementation mechanisms in the revitalization, so as to ensure effective enforcement of the plan.

    9.1 Ensure enforcement of ongoing policies and measures

    We must press ahead with ongoing policies and measures, with emphasis on solving problems as follows: issues remained in collectively-owned businesses that were affiliation with SOEs, historical tax arrears in enterprises, and renovation of shanty areas surrounding coal enterprises once under supervision of central government. An enabling policy environment must be created for revitalizing the Northeast.

    9.2 Improve revitalization policies

    We must provide policy supports for the development of equipment manufacturing industry in Northeast China. For enterprises importing key parts, components and raw materials to manufacture strategic technological equipments, we must allow these enterprises to enjoy preferential duty-free status, tax rebate benefits or rebate of value-added tax in importing process. We must encourage businesses to order and use key technical equipments made in China. Support must be given to large state-owned equipment manufacturing enterprises that are of vital importance to national strategies and people’s livelihood, technological innovation projects for urgently needed key equipments, as well as the technological upgrading projects that are crucial for the restructuring of industries.

    Financial institutions should raise credit support to eligible projects in the Northeast and we must carry out researches to establish regional reinsurance agencies for providing credit guarantees for SMEs. We must improve credit-lending environment, support state-owned commercial banks in disposing non-performing assets, encourage enterprises to go public and help qualified public entities in Northeast to raise funds by issuing business bonds.

    9.3 Establish regional coordination mechanisms

    On the basis of equity, mutual benefit, cooperation and resources optimization, we must enhance regional partnerships among Northeast China, Eastern, Central and Western regions by forming coordinating mechanisms for win-win cooperation. We shall encourage developed regions to join in revitalizing the Northeast and strengthen the economic linkages among Northeast China and Beijing-Tianjin-Hebei, Shandong Peninsula, Yangtze River delta, Pearl River delta. We must also support enterprises in the Northeast to actively participate in the campaigns of ” Development of Western China” and the ” Rise of central China.”

    In addition, we must establish inter-regional public platforms and coordination networks. We must establish high-rank coordination conference system of four concerned provinces, on which to solve key bottleneck problems in regional development through consultation and discussion, and establish coordination agencies within framework of this conference system.

    We must encourage inter-regional M&A and structuring of enterprises. Enterprises to have inter-regional merger and restructuring in assets must get preferential verification by the state and preferential supporting funds. We must support cooperation between three provinces in the Northeast and Eastern Inner-Mongolia to carry out joint development, especially in constructing large coal, oil bases and other bases in eastern Inner Mongolia.

    9.4 Improve plan implementation mechanisms

    We must strengthen implementation of this plan. Concerned state authorities and governments at all levels in the Northeast must have their own share of responsibilities and enhance interdepartmental cooperation and communication. Local governments must work out detailed suggestions and adopt detailed actions to implement the plan, and disintegrates all tasks in their annual plans. Comprehensive appraisal and performance assessment for implementing the plan must be enhanced to deliver real effects.

    We must reinforce supervision, strengthen the follow-up of plan implementation, and improve information communication and feedback mechanisms to link government with enterprises and the common people, therefore soliciting support from the whole society in the revitalization process.

    Moreover, we shall organize mid-term assessment of the plan. We must make updates in the contents and procedures according to external changes and progress made in the process of implementation, thereby ensuring effectiveness of the plan.

China’s real estate boom continues in November

    BEIJING, Dec. 18 (Xinhua) — China’s real estate sector is continuing to boom despite tighter monetary policy, at least in terms of total fund inflows, the latest government statistics show.

    Also, more foreign capital is going into the property market.

    Just over 3,204 billion yuan (435.4 billion U.S. dollars) flowed into China’s property sector during the first 11 months of the year, up 40.8 percent. This figure includes the value of new contracts.

    Overseas capital flows into real estate surged by 71.9 percent over the same period last year to 53.9 billion yuan. Overseas capital includes investment from Hong Kong and Macao.

    The data was released by the National Bureau of Statistics (NBS) Monday in its November national real estate climate index report, which tracks real estate trends in China.

    The real estate climate index rose slightly in November to 106.59, up 0.85 points from October and up 2.67 points from last November.

    Completed investment by property developers rose more than 30 percent to 2,163.2 billion yuan in the first 11 months. Of that total, investment in residential buildings was 1,544 billion yuan, up 33.7 percent.

    Within the residential category, 69.3 billion yuan went into affordable or subsidized housing in the first 11 months, up 31.7 percent. That figure was just 3 percent of total investment in housing.

    The government is still trying to boost programs to provide affordable housing for low-income households. Last month, the government urged local authorities to reserve at least 70 percent of the land designated for residential construction for low-rent units or smaller, cheaper homes.

    Although investment and capital in real estate increased in value terms in November, government efforts to deflate the property bubble seemed to be taking effect. The floor space of marketable, unsold buildings dropped 4.5 percent to 117.97 million square meters, which could be the result of developers building more affordable homes and fewer luxury properties.

    China has raised the benchmark one-year lending rate five times this year amid efforts to curb investment growth and slow the economy.

Survey: Heavy taxes hamper Chinese private business

    BEIJING, Dec. 18 (Xinhua) — Heavy taxation has become a major factor that hampers private enterprises’ expansion, according to a survey by the China National Democratic Construction Association (CNDCA).

    A report based on the results of the survey was released at the ongoing CNDCA 9th national congress, which opened in Beijing on Sunday.

    According to the survey, 12.5 percent of private enterprises in China found the tax burden “too heavy, almost unbearable”, reported the Beijing News on Monday.

    One-fourth of the enterprises agreed that “the administrative and law enforcement departments relevant to the private sector” have no concept of providing good service to business — and sometimes even use their power to take advantage of private enterprise, the newspaper said.

    The survey found that value-added tax revenues came mainly from the manufacturing, wholesale and retail industries, while most sales tax was generated from the construction and real estate industries. There were almost no tax revenues from private-sector financial firms or other state-dominated industries, which shows that private enterprises could only develop in parts of the economy.

    Although new laws that take effect on Jan. 1 will eventually equalize the tax rates for foreign and domestic companies, foreign enterprises will enjoy some residual tax advantages as higher rates for them are phased in, according to the newspaper.

    CNDCA suggested that new regulations to implement the enterprise tax law should define small private enterprises as those with annual profits of less than 50,000 yuan (about 6,700 U.S. dollars) and should also encourage small enterprises to expand.

    It also suggested that private companies should be allowed to enter all sectors, including those that are open to foreign enterprises and some of those that are yet to open.

    As of the end of 2006, there were 34 million private enterprises in China, which generated tax revenue of 350.5 billion yuan or 9.5 percent of total tax revenues. That was a rise of about 6 percentage points from the share of tax revenues in 2000, when private firms only generated 3.3 percent of the nation’s tax revenues.

    CNDCA, one of the country’s eight non-communist parties, was founded by industrialists and intellectuals in Chongqing on Dec. 16, 1945. The CNDCA has more than 108,000 members nationwide, mainly business people.

China’s accommodation and catering sales rise 21.6% in Nov.

    BEIJING, Dec. 17 (Xinhua) — China’s accommodation and catering sales rose 21.6 percent to 110 billion yuan (14.9 billion U.S. dollars) in November over the same period a year earlier, the Ministry of Commerce announced here on Monday.

    In the first 11 months, retail sales of the accommodation and catering industry totaled 1.11 trillion yuan, up 18.9 percent year-on-year. It accounted for 13.9 percent of overall retail sales.

    During the period, 862 foreign-funded companies in the accommodation and catering sectors were approved, down 11.9 percent. The utilization of foreign funds rose 8.3 percent to 790 million U.S. dollars.

PBOC governor: CPI surge, U.S. interest rate cuts to influence China policy

    BEIJING, Dec. 12 (Xinhua) — China’s central bank governor, Zhou Xiaochuan, said on Wednesday that surging domestic consumer prices and recent U.S. interest rate cuts would have “considerable influence” over Chinese monetary policy.

    The central bank, the People’s Bank of China (PBOC), would “seriously consider” the situation, added Zhou.

    Zhou made the remarks at a news briefing on the sidelines of the Third China-U.S. Strategic Economic Dialogue (SED) held in Beijing. The two-day event began on Wednesday.

    Increases in the consumer price index (CPI) had been mainly driven by soaring food prices, Zhou said. Whether and how the CPI could be curbed through monetary policy was being studied, Zhou said, admitting that the issue could be contentious.

    China’s consumer price index (CPI) for November rose 6.9 percent from a year earlier, according to statistics released from the National Bureau of Statistics (NBS) on Tuesday morning.

    The figure showed that inflationary pressures were persisting, and it triggered concern about further tightening measures.

    As to the recent interest rate cuts by the U.S. Federal Reserve, Zhou said China concerns the possible indirect impact on the country, which already had excess liquidity in the capital market.

    The governor also said that China backed a strong dollar and would back U.S. efforts to recover from the sub-prime credit crisis.

Official: China’s sovereignty wealth fund to make prudent investment

    BEIJING, Dec. 12 (Xinhua) — China’s sovereignty wealth fund will maintain prudent investment and respect the laws in recipient countries, Finance Minister Xie Xuren said here Wednesday.

    Speaking during a break in the two-day China-U.S. Strategic Economic Dialogue, Xie said that the fund would pursue long-term investment instead of short-term speculation, and would achieve a balance between security and profitability.

    ”So, the sovereignty wealth fund is an important force in helping stabilize global growth and address global economic imbalance,” he said.

    The fund, or China Investment Corp. (CIC), was set up in September this year, with an initial capital of 200 billion U.S. dollars from the country’s massive foreign exchange reserves.

    One-third of the capital would be used to purchase Huijin Investment Co. that now controls major state-owned commercial banks. Another third would be injected into state-owned banks for shareholding reforms, CIC chairman Lou Jiwei said earlier this week.

    The remaining 70 billion U.S. dollars was earmarked for overseas investment in a wide range of portfolios but would not seek control, said Lou.

    ”CIC attaches great importance to dialogue and cooperation with international organizations, foreign regulatory bodies and counterparts,” said Xie.

    It would be effectively supervised and operate in accordance with international rules and local laws in recipient countries.

ADB: Macao ranks 3rd in per capita GDP in Asia-Pacific

   　MACAO, Dec. 12 (Xinhua) — An Asian Development Bank (ADB) survey says Macao ranks third in per capita real GDP among 23 “developing economies” in Asia and the Pacific, only after Brunei and Singapore, the Macao Daily News reported on Wednesday.

    ADB’s 2005 International Comparison Program (ICP), released on Monday, showed that Macao’s per capita real GDP in that year stood at 211,907 HK dollars (27,175 U.S. dollars), as against 202,941 HK dollars (26,025 U.S. dollars) in Hong Kong.

    But the ICP survey also tags Macao as the third costliest place to live, only after Fiji and Hong Kong in the region. In terms of per capita actual final consumption expenditure (AFCE), Hong Kong still appears as the biggest spender with its AFCE of 125,303 HK dollars (16,069 U.S. dollars) as against Macao’s 67,160 HK dollars (8,612 U.S. dollars), ranking fifth in the survey.

    Although Macao’s booming gaming industry has contributed to the spike of its per capita GDP, most civilians still saw their salaries stay in low level, which resulted in its low AFCE, the newspaper quoted Dominic Sio, board chairman of Center of Strategic Research for Development of Macao, as saying.

    Sio also pointed out that the government should make effort to turn Macao into a knowledge-orientated society like Hong Kong, the population of which comprises a large number of well-educated and affluent middle classes.

    The survey is part of a global initiative spearheaded by the World Bank that allows cross-country comparisons of purchasing powers of currencies and living standards.