PRC Legal Provisions

People's Police Law of the People's Republic of China (Chinese Text)

The following text was retrieved from the PRC Ministry of Public Security <a href="https://www.mps.gov.cn/webPage/showfagui.asp?ID=3171">Web site</a> on January 20, 2006.

Provisional Measures on Public Participation in Environmental Impact Assessments (Chinese Text)

White Paper: China's Peaceful Development Road (English Text)

The following translation was retrieved from the People's Daily <a HREF="https://english.peopledaily.com.cn/200512/22/eng20051222_230059.html">Web site</a> on December 22, 2005.<HR> UPDATED: 11:09, December 22, 2005 Full Text: China's Peaceful Development Road The State Council Information Office published on Thursday, December 22, 2005, a white paper entitled China's Peaceful Development Road. The document is composed of five chapters, i.e., Peaceful Development Is the Inevitable Way for China's Modernization; Promoting World Peace and Development with China's Own Growth; Developing by Relying on Its Own Strength, Reform and Innovation; Seeking Mutual Benefit and Common Development with Other Countries; and Building a Harmonious World of Sustained Peace and Common Prosperity. Since the policies of reform and opening-up were introduced at the end of the 1970s, China has successfully embarked on a road of peaceful development compatible with its national conditions and characteristics of the times. Along this road, the Chinese people are working hard to build China into a prosperous, powerful, democratic, civilized and harmonious modern country, and continually making new contributions to human progress with China's own development. The white paper for the first time completely and systematically clarifies the Chinese government's and people's theory and practice in this regard. I. Peaceful Development Is the Inevitable Way for China's Modernization To achieve peaceful development is a sincere hope and unremitting pursuit of the Chinese people. Since the policies of reform and opening-up were introduced at the end of the 1970s, China has successfully embarked on a road of peaceful development compatible with its national conditions and characteristics of the times. Along this road, the Chinese people are working hard to build China into a prosperous, powerful, democratic, civilized and harmonious modern country, and continually making new contributions to human progress with China's own development. Looking back upon history, basing itself on the present reality and looking forward to the future, China will unswervingly follow the road of peaceful development, making great efforts to achieve a peaceful, open, cooperative and harmonious development. - Striving for a peaceful international environment to develop itself, and promoting world peace through its own development; - Achieving development by relying on itself, together with reform and innovation, while persisting in the policy of opening-up; - Conforming to the trend of economic globalization, and striving to achieve mutually beneficial common development with other countries; - Sticking to peace, development and cooperation, and, together with all other countries, devoting itself to building a harmonious world marked by sustained peace and common prosperity. Peace, opening-up, cooperation, harmony and win-win are our policy, our idea, our principle and our pursuit. To take the road of peaceful development is to unify domestic development with opening to the outside world, linking the development of China with that of the rest of the world, and combining the fundamental interests of the Chinese people with the common interests of all peoples throughout the world. China persists in its pursuit of harmony and development internally while pursuing peace and development externally; the two aspects, closely linked and organically united, are an integrated whole, and will help to build a harmonious world of sustained peace and common prosperity. China's road of peaceful development is a brand-new one for mankind in pursuit of civilization and progress, the inevitable way for China to achieve modernization, and a serious choice and solemn promise made by the Chinese government and the Chinese people. - It is an inevitable choice based on its national conditions that China persists unswervingly in taking the road of peaceful development. During the 100-odd years following the Opium War in 1840, China suffered humiliation and insult from big powers. And thus, ever since the advent of modern times, it has become the assiduously sought goal of the Chinese people to eliminate war, maintain peace, and build a country of independence and prosperity, and a comfortable and happy life for the people. Although it has made enormous achievements in development, China, with a large population, a weak economic foundation and unbalanced development, is still the largest developing country in the world. It is the central task of China to promote economic and social development while continuously improving its people's life. To stick to the road of peaceful development is the inevitable way for China to attain national prosperity and strength, and its people's happiness. What the Chinese people need and cherish most is a peaceful international environment. They are willing to do their best to make energetic contributions for the common development of all countries. - It is an inevitable choice based on China's historical and cultural tradition that China persists unswervingly in taking the road of peaceful development. The Chinese nation has always been a peace-loving one. Chinese culture is a pacific culture. The spirit of the Chinese people has always featured their longing for peace and pursuit of harmony. Six hundred years ago, Zheng He (1371-1435), the famous navigator of the Ming Dynasty, led the then largest fleet in the world and made seven voyages to the "Western Seas," reaching more than 30 countries and regions in Asia and Africa. What he took to the places he visited were tea, chinaware, silk and technology, but did not occupy an inch of any other's land. What he brought to the outside world was peace and civilization, which fully reflects the good faith of the ancient Chinese people in strengthening exchanges with relevant countries and their peoples. Based on the present reality, China's development has not only benefited the 1.3 billion Chinese people, but also brought large markets and development opportunities for countries throughout the world. China's development also helps to enhance the force for peace in the world. - It is an inevitable choice based on the present world development trend that China persists unswervingly in taking the road of peaceful development. It is the common wish of the people throughout the world and an irresistible historical trend to pursue peace, promote development and seek cooperation. In particular, further development of multi-polarization and economic globalization has brought new opportunities for world peace and development, and thus it is possible to strive for a long-term peaceful international environment. Meanwhile, China is clearly aware that the world is still troubled by many factors of instability and uncertainty, and mankind still faces many severe challenges. However, there are more opportunities than challenges, and as long as all countries work together we can gradually attain the goal of building a harmonious world of sustained peace and common prosperity. For many years, China has consistently followed an independent foreign policy of peace, the purpose of which is to safeguard world peace and promote common development. As early as in 1974, when China resumed its membership in the United Nations, Deng Xiaoping proclaimed to the world that China would never seek hegemony. Since the policies of reform and opening-up were introduced, China, keeping in view the changes in the international situation, has upheld the important strategic judgment that peace and development are the theme of the present times, and declared on many occasions that China did not seek hegemony in the past, nor does it now, and will not do so in the future when it gets stronger. China's development will never pose a threat to anyone; instead, it can bring more development opportunities and bigger markets for the rest of the world. Facts prove that China's economic development is becoming an important impetus for economic growth in the Asia-Pacific region and even the world as a whole. It has become the national determination of China to safeguard world peace and promote common development. At present, the Chinese people are working hard to build a moderately well-off society in an all-round way. Not long ago, the Fifth Plenary Session of the 16th Central Committee of the Communist Party of China set the main targets for China's economic and social development from 2006 to 2010, of which the principal economic target is to double the 2000 per-capita GDP by 2010 on the basis of optimizing its structures, increasing economic returns and reducing consumption; and enhance substantially the resource utilization ratio, and by 2010 reduce the 2005 per-unit GDP resource consumption by around 20 percent. To attain this target, China, guided by the scientific concept of development with people first, overall coordination and sustainable development at the core, will promote the overall development of its economy, politics, culture and society. While seeking development by relying primarily on its own strength, China sticks to the policy of opening-up, engages in extensive international economic and technological cooperation, and shares with all other countries the fruits of mankind's civilization; respects and gives consideration to others' interests, works with other countries to solve the disputes and problems cropping up in cooperation, and strives to achieve mutual benefit and common development; abides by its international obligations and commitments, actively participates in international systems and world affairs, and endeavors to play a constructive and locomotive role; and gets along with all other countries equally and develops friendly relations with them on the basis of the Five Principles of Peaceful Coexistence. II. Promoting World Peace and Development with China's Own Growth Peace is the foundation for development while development is fundamental for peace. For years, the Chinese government and people have made unremitting efforts to create a peaceful international environment. They cherish dearly the peaceful international environment jointly created by the peace-loving and progress-seeking countries and peoples, concentrate on their own construction and whole-heartedly seek development, and strive constantly to make positive contributions to world peace and development with their own growth, and promote human civilization and progress. China's development needs a peaceful international environment. Since 1978, when the policies of reform and opening-up were adopted, China has endeavored to develop itself within a peaceful international environment. Its GDP has increased from 362.4 billion yuan (about US$215.3 billion if converted directly from Renminbi into US dollar at the average exchange rate of that year) to 15,987.8 billion yuan (about US$1931.7 billion if converted directly from Renminbi into US dollar at the average exchange rate of that year) in 2004, an average growth rate of over 9 percent per annum, calculated according to constant price. Its per-capita GDP has risen from less than US$300 to more than US$1,400. China has also made new progress in its building of political civilization, with its democratic system being improved continuously, the freedom and rights of citizens being protected and guaranteed by law, and its people exercising their rights of democratic election, decision-making, administration and supervision in accordance with the law. A legal system centered on the Constitution has taken initial shape, and the basic strategy of ruling the country by law has been implemented. Rapid progress has been scored in its education, science and technology, culture, health, sports and other undertakings, and the increasing spiritual and cultural needs of the people have been constantly satisfied. The construction of a harmonious society has been reinforced, and the state is working hard to realize and safeguard social fairness and justice, increase creativity of the whole society, beef up social construction and administration, and maintain social stability and harmonious relations between man and Nature. China's development is an important component of global development. China has promoted world peace with its own development and made contributions to the progress of mankind. China has made contributions to the sustained development of human society. Based on previous experience and the fruits of modern civilization of mankind, it has adopted the scientific outlook on development to transform its concepts, create new modes for growth and enhance the quality of development. Over the years, China has persisted in exploring a new road to industrialization, featuring high scientific and technological content, good economic returns, low resources consumption, little environmental pollution and a full display of advantages in human resources, and striven to steer the entire society along a road of sustained development of civilization, with advanced production, affluent life and favorable ecological conditions. China's success in population control has retarded the expansion of the population of the world as a whole. China emphasizes energy saving, and has adopted various measures in this regard. During the period 1980-2000, its GDP quadrupled, but the annual consumption of energy only doubled. Due to China's intensified efforts at environmental protection, its dust discharge has remained the same as in 1980 despite a big increase in installed thermal-power capacity. Its energy consumption of per 10,000-yuan GDP in 2004 dropped by 45 percent compared to 1990. China has made medium- and long-term plans for energy conservation, aiming to keep an annual energy-saving rate of 3 percent by 2020, to save 1.4 billion tons of standard coal. China has made contributions to reducing human poverty and improving the quality of life. It has created a miracle by feeding nearly 22 percent of the world's population on less than 10 percent of the world's arable land. The living standards of its 1.3 billion people are constantly improving. The Chinese government has lifted 220 million people out of poverty, and provided minimum living allowances to 22.05 million urban residents and aid to 60 million disabled people. The life expectancy of the Chinese has been extended from 35 years before New China was founded in 1949 to 71.95 years today, close to that of moderately developed countries. China has made contributions to safeguarding world peace and promoting international cooperation. On the basis of the Five Principles of Peaceful Coexistence, China has developed friendly, cooperative relations with other countries and promoted peaceful coexistence and equal treatment among countries. China has always adhered to the principle of being a friendly neighbor; and has constantly developed good and cooperative relationships with surrounding countries and other Asian countries and expanded common interests with them. China has established various cooperative relationships with major powers, and unremittingly augmented mutual dialogues, exchanges and cooperation. China has also expedited cooperation with a vast number of developing countries, to seek common development by drawing on one another's advantages within the South-South cooperation framework. Active in the settlement of serious international and regional problems, China shoulders broad international obligations, and plays a responsible and constructive role. China has made contributions to world economic development. In recent years, despite increasingly severe global economic fluctuations, China's economy has maintained a stable and relatively fast growth, bringing hope and a new driving force to world economic development. Statistics released by the World Bank show that China's economic growth contributed on average 13 percent to world economic growth from 2000 to 2004. In 2004, the world economy reported the swiftest growth in 30 years, while China's economy grew by 9.5 percent and became a key driving force for the former. Also in 2004, China's import and export figure doubled that of three years previously, reaching US$1,154.8 billion, and its import figure nearly doubled that of three years previously, reaching US$561.4 billion. By the end of 2004, China had made use of US$745.3 billion paid-in foreign capital, and approved more than 500,000 foreign-funded enterprises. China has made contributions to the stable development of surrounding areas. China has more than 20 neighbors that either border on its territory or lie across the nearby seas. China's sustained economic growth, social stability and its people's peaceful life also benefit its neighboring countries. The Asia-Pacific economy kept a 6-percent growth between 1999 and 2004. To ensure a stable environment for the continuous development of its surrounding areas, China overcame arduous difficulties at the time of the 1997 Asian financial crisis, and stuck to the principle of keeping the value of the Renminbi stable while expanding domestic demand, and helped to the best of its ability the victim countries to weather the crisis. China played its role in finally overcoming the crisis. In the case of the 2003 sudden outbreak of SARS, the Chinese government took decisive steps, and cooperated with its neighbors in effectively curbing it. Upon the occurrence of the Indian Ocean tsunami in late 2004, the Chinese government and its people offered timely and sincere aid - the largest external aid in the history of New China - to the suffering countries in their rescue and re-construction effort. The Chinese also expressed great sympathy and extended assistance when South Asia was struck by massive earthquakes in October 2005. Despite gigantic achievements, China still remains the largest developing country in the world, with a formidable task of development lying ahead. According to the latest statistics released by the World Bank and statistics recently released by China, in 2004, China's aggregate economic volume accounted only for 16.6 percent of that of the US, and its per-capita GDP was merely 3.6 percent that of the US and 4.0 percent of Japan, ranking 129th among 208 countries and regions around the world. By the end of 2004, 26.1 million rural Chinese still lived under the poverty line, more than 100 million farmers have to be provided with jobs elsewhere, and the government is obliged to create jobs for nearly 24 million urban and rural residents every year. There is still a long way to go for China to reach the level of the moderately developed countries and achieve common prosperity for the whole country. China still needs to make persistent efforts to strive for a peaceful international environment for its own development, and promote world peace and development with its own growth. This is particularly significant for both China and the world as a whole. III. Developing by Relying on Its Own Strength, Reform and Innovation China will adhere to the scientific approach for development and have an overall plan for domestic development and opening to the outside world, and base its development on its own realities. At the same time, China will maintain the approach of all-round, wide-area, multi-level openness to the outside world, striving to attain a more balanced development. The main problem facing China in its development is the contradiction between its underdeveloped economy and its people's ever-increasing material and cultural demands, and the contradiction between economic and social development and the relatively strong pressure of the population, natural resources and the environment. Past experience indicates that fundamentally China must rely on itself to solve the problems in its development. By doing so, the country will be responsible to the Chinese people as well as to the people of the rest of the world. It is an important principle that guarantees that China will follow the road of peaceful development. China will not shift its own problems and contradictions onto other countries, much less will it plunder other countries to further its own development. To achieve development, China will mainly rely on its own strength, reform and innovation. It has many advantages and favorable conditions: It has the material and technological foundation supporting further economic development; it has an ever-growing huge market and a high rate of private savings deposits; it has a large labor force whose quality, as a whole, is improving all the time; it has an ever-improving socialist economic market system and related policy guarantee; and it has a stable social and political environment. China intends to do the following work well in order to achieve development by mainly relying on its own strength and through reform and innovation: - Adhering to innovation in ideas and systems. Practice over the two decades or so since China introduced the reform and opening-up policies has proved that, by emancipating the mind, seeking truth from facts and striving for progress, China is able to bring into full play the enthusiasm, initiative and creativity of its hundreds of millions of people and open up new prospects for its modernization drive. China will unswervingly push forward reform in all aspects, remain steadfast in the direction of socialist market economy in its reform, intensify reform with emphasis on institutional innovation, and strive to make breakthroughs in some key areas and important links. Through reform, China will enhance marketization of its national economy, improve the state's macroeconomic regulatory system, and constantly establish institutions and mechanisms conducive to an overall, coordinated and sustainable economic and social development. - Opening up the domestic market and increasing domestic demand. It is China's fundamental stand and long-term strategic guiding principle to expand domestic demand in its economic and social development. China has entered a period when the pace of industrialization and urbanization is being quickened, the people's income level is increasing and their consumption structure is being upgraded. While changing its mode of foreign trade growth, increasing imports and strengthening intellectual property protection, and continuing to make contributions to global trade and the world economy, China keeps up its driving force to maintain sustained economic development through its huge domestic demand and domestic market. This has determined that China should and most likely will mainly rely on domestic demand for its development. China will ensure that investment in fixed assets will increase at a reasonable scale and pace so as to bring into better play the role of investment in economic growth. By implementing correct income distribution and consumption policies, China is relying more on domestic demand and consumption to promote its economic development. In recent years, domestic investment and consumption needs are increasing at a rather rapid rate. - Promoting the strategic adjustment of the economic structure and the change of growth mode. China considers changing the growth mode a strategic focal point, strives to base economic growth on the enhancement of the quality of its human resources, efficient use of natural resources, reduction of environmental pollution, and emphasis on the quality and efficiency of its economy. China will take a new road of industrialization - using the IT industry to promote industrialization and letting industrialization support the development of the IT industry. It will quicken the pace of optimizing and upgrading its industrial structure, develop advanced manufacturing industry, high- and new-tech industry, especially the IT and biological industries, increase the proportion of the service sector and improve the level of services, strengthen the construction of infrastructure facilities of basic industries, and bring into full play the function of structural readjustment in the change of the growth mode. China will work hard to develop a cost-saving, recycling and environment-friendly economy, establishing a national economic system characterized by intensification and cleanness. - Promoting scientific and technological progress and strengthening the ability of independent innovation. China is striving to become a country of innovation, and it is a state strategy to strengthen the ability of independent innovation. It has made medium- and long-term scientific and technological development plans, setting forth the objectives and tasks for scientific and technological development for the next 15 years. China is making every effort to enhance its ability of original innovation, integrated innovation and re-innovation after absorbing advanced technology from abroad. By reforming the scientific and technological system and increasing financial input through various channels, China will promote the construction of its national innovation system and speed up the pace of commercialization of research findings. China hopes to increase the proportion of funds for scientific and technological research and development from 1.44 percent of the GDP in 2004 to 2.5 percent in 2020. - Making every effort to exploit human resources. China will make effort in implementing the strategy of relying on talented people to make the country powerful. It will quicken the readjustment of the educational structure and institute education aimed at all-round development of students, with emphasis being put on compulsory education, especially compulsory education in the countryside. It will make greater efforts to develop vocational education and raise the quality of its higher education, so as to greatly promote the development of education and foster qualified workers and specialized personnel in all fields. It is expected that from 2006 to 2010 the secondary vocational schools will train 25 million graduates, and the higher vocational schools 11 million graduates for the society. The enrolment rate of China's institutions of higher learning will reach 40 percent by 2020. Meanwhile, China will bring in talented personnel, especially high-level personnel, from abroad, forming a favorable mechanism and social atmosphere in which talented people keep emerging in large numbers and every individual gives full play to his or her talents, thus providing abundant human resources and intellectual support for the country's modernization program. - Working hard to build a resource-saving and environment-friendly society. Historical experiences show that to have a balanced and orderly development of the world economy, the international community must handle the energy problem properly. Through dialogues and cooperation regarding energy, China is working with other countries to safeguard energy safety and stability. China considers energy saving one of its basic state policies. Centering on conservation of energy resources and raising the efficiency of energy consumption, China is working hard to develop a recycling economy so that it will garner the highest possible economic and social benefits with the lowest possible energy consumption. China has persisted in relying on its domestic resources and constantly increasing the supply of domestic energy. China is not only a big energy consuming country, but also a big energy producing one. Since the 1990s, China has obtained 90 percent or more of its energy from domestic sources. The potential of its domestic energy supply is still great. Verified coal reserves account for only a small proportion of the potential reserves. Moreover, it is likely that new oilfields and natural gas fields will be discovered, and the future of new types of energy and regenerated energy is promising. Meanwhile, China upholds the basic state policy of environmental protection, and is making more and more efforts to protect and improve its ecological environment, so as to create conditions for sustainable economic and social development. In its environmental protection efforts, China persists in putting precautionary measures first, treating environmental pollution comprehensively and preventing pollution at the source. China gives priority to environmental protection, makes sure that the exploitation of natural resources is in good order, emphasizes prevention of excessive exploitation of natural resources, and intensifies protection of natural resources and ecology. China will unswervingly carry out the basic state policy of opening up to the outside world, and actively engage in economic and technological exchanges and cooperation with other countries to raise the overall level of openness. China has earnestly fulfilled the promises it made when admitted into the World Trade Organization (WTO) by constantly improving the management system and policies concerning foreign businesses in China and creating a fair and predictable legal environment; opening the market further and improving the environment for investment and trade; improving the trade structure, enhancing the degree of freedom and convenience for trade and investment, and creating a better environment for investment; and, in addition, encouraging its own enterprises to invest overseas and developing alongside foreign businesses. Opening up to the outside world has played a very important role in promoting China's economic and social development. The foreign capital China brings in makes up for the inadequacy of capital for development. Domestic industries have been growing rapidly thanks to the full utilization of overseas markets. The introduction of advanced technology, equipment and management expertise has improved the production technology and management level of Chinese enterprises. Frequent exchanges with other countries make it possible for China to share the fruits of mankind's civilization and improve the quality of its own human resources. IV. Seeking Mutual Benefit and Common Development with Other Countries China cannot develop independently without the rest of the world. Likewise, the world needs China if it is to attain prosperity. Following the trend of economic globalization, China is participating in international economic and technological cooperation on an ever larger scale, in wider areas and at higher levels in an effort to push economic globalization towards the direction of common prosperity for all countries. Today, the mainstream of international trade is to share successes, with all as winners. China adheres to its opening-up strategy for mutual benefit. For this, it has made conforming to China's own interests while promoting common development a basic principle guiding its foreign economic and trade work, develops its economic and trade relations with other countries on the basis of equality, mutual benefit and reciprocity, and makes constant contributions to the sustained growth of global trade. China has exerted itself to push forward multilateral economic and trade relations and regional economic cooperation, actively participated in the formulation and execution of international economic and trade rules, and joined various other countries in settling disputes and problems emerging in their cooperation, so as to promote the balanced and orderly development of the world economy. China has been an active supporter of and participant in multilateral trade system. Since its accession to the WTO in December 2001, China has strictly kept its commitments to create more favorable conditions for international economic and technological cooperation. China has sorted out and revised some 3,000 laws, regulations and department rules, continually improved its foreign-related economic legal system, and enhanced the transparency of its trade policies. China has cut its customs tariffs step by step, as promised, and by 2005 its average tariffs had been reduced to 9.9 percent, and most non-tariff measures had been cancelled. Banking, insurance, securities, distribution and other service trade sectors have opened wider to the outside world. Of the 160-odd service trade sectors listed by the WTO, China has opened more than 100, or 62.5 percent, a level close to that of the developed countries. China has actively pushed ahead with a new round of multilateral trade negotiations, participated in talks on various topics, especially on agriculture, market access of non-farm products and the service trades, and played a constructive role in helping developing and developed members reduce disputes through talks. China, together with other WTO members, has done a lot of work to spur substantial progress to reach early agreement among the negotiators. China has continuously stepped up participation in regional economic cooperation. The building of the China-ASEAN Free Trade Area is going full steam ahead. Following the practice of zero tariffs on farm products under the "Early Harvest Program," the Agreements on Trade in Goods and the Dispute Settlement Mechanism Agreement were formally signed in November 2004, and in July 2005 the free trade area launched its tariff concession program, clearing the way for realizing its goals. At present, the building of the Shanghai Cooperation Organization is proceeding with comprehensive and pragmatic cooperation, and its process to facilitate trade investment has been launched in an all-round way. China has also initiated negotiations on such free trade areas as the China-Southern African Development Community, China-Gulf Cooperation Council, and China-New Zealand, China-Chile, China-Australia and China-Pakistan, and signed relevant agreements with its partners. China is also an active and pragmatic participant in the activities of the Asia-Pacific Economic Cooperation, Forum on China-Africa Cooperation, Sino-Arab Cooperation Forum, Asia-Europe Meeting and Greater Mekong Subregion Economic Cooperation Program. China advocates the liberalization and facilitation of investment in bilateral trade, and has signed bilateral trade agreements or protocols with more than 150 countries and regions, bilateral investment protection agreements with more than 110 countries, and agreements with over 80 countries on the avoidance of double tariffs. China sticks to the principle of mutual benefit and win-win cooperation, tries to find proper settlement of trade conflicts and promotes common development with other countries. Trade conflicts are quite natural in international economic exchanges. Following international practice and WTO rules, China has tried to resolve such conflicts through dialogue on an equal footing and through the WTO dispute settlement mechanism. When promulgating and implementing domestic economic policies, it tries to take international factors and influences into account as well as the impacts its own economic growth imposes on the outside world. Based on its reform and development, China is serious in judging the effects its exchange rate reform may bring to surrounding countries and regions, and the global economy and finance. It has thus advanced the reform in a steady way, adopted a managed floating exchange rate regime based on market supply and demand, and linked and adjusted it according to a basket of currencies, so that the Renminbi exchange rate will remain stable at a reasonable and balanced level. China has intensified its protection of intellectual property rights, improved the relevant legal system, and tightened up law enforcement to crack down on all kinds of violations. Growing China is active in international economic and technological cooperation, and provides good opportunities and a huge market for the rest of the world. All countries, the developed countries in particular, have reaped lucrative benefits from investment in and service trade with China. China's active involvement in the international division of labor and cooperation is conducive to the reasonable and effective distribution of global resources. As the largest developing country in the world, China boasts an abundant labor force, the quality of which has been constantly improving. It is a natural advantage of China in developing labor-intensive industries and some technology-intensive ones. Along with economic and social progress, as well as the improvement of the living standards of its people, China's demand for capital-, technology- and knowledge-intensive products keeps increasing, offering great opportunities for foreign products, technologies and services, as the country has now evolved into an internationally acknowledged big market. China's foreign trade is mutually supplementary with many countries. About 70 percent of China's exports to the US, Japan and the Europe Union (EU) are labor-intensive, while 80 percent of its imports from the three are capital-, technology- and knowledge-intensive. In the new structure of international labor division, the country has become a key link in the global industrial chain. By importing cheap but good-quality products made in China, the importing countries can reduce their expenditure and pressure caused by inflation while satisfying the demands and enhancing the welfare of their consumers. China's labor-intensive products enjoy unique comparative advantages in the global market. Since 1997, US consumers have saved billions of dollars every year by buying Chinese commodities - US$600 billion in the past decade and nearly US$100 billion in 2004 alone. The expansion of China's reciprocal economic and trade relations with other countries has benefited both in a tremendous way. China's imports have kept growing by a yearly 16 percent since 1978, and the country imported commodities worth US$1,270 billion in the three transitional years following its WTO accession. In 2004, China became the world's third largest importer, next only to the US and Germany, with US$148.47 billion of increased imports or 9 percent of the world's total growth of imports. Also in 2004, China's trade volume with the EU, the US and Japan totaled US$177.3 billion, US$169.6 billion and US$167.8 billion, respectively, making them China's top three trade partners and main sources of foreign investment. In the same year, China's trade volume with Asian countries and regions amounted to US$664.9 billion, 34.2 percent up over that of the previous year. This figure accounted for 57.6 percent of China's total foreign trade value. In addition, China has become the fourth largest trading partner of and a fast-growing market for ASEAN. The huge market of China offers such great opportunities for international capital that investors around the world have benefited from China's rapid economic growth. From 1990 to 2004, foreign investors repatriated US$250.6 billion in profits from China. In 2004, US-funded enterprises in China generated US$75 billion in sales revenue in China, and their products earned another US$75 billion elsewhere. A 2005 survey by the American Chamber of Commerce-People's Republic of China shows that 70 percent of American firms are making profits in China, and about 42 percent report a higher profit rate than their global average. China's growing investment abroad has also fueled the economies of the destination countries. At the end of 2004, China's net non-banking direct investment abroad amounted to US$44.8 billion, spreading to 149 countries and regions. Among which, US$33.4 billion, or 75 percent, went to Asia. China's foreign economic and trade cooperation has tremendous potential and boosts bright prospects. In the post-WTO era, China imported US$500 billion worth of commodities annually during the period from December 2001 to September 2005, which meant 10 million jobs for the countries and regions concerned. In the next few years, it will import US$600 billion worth of goods annually, and the amount will exceed US$1,000 billion by 2010. By 2020, the scale and total demand of the Chinese market will quadruple that in 2000. During the process, the rest of the world will find development and business opportunities in their reciprocal cooperation with China, which will greatly accelerate the growth of the global economy. V. Building a Harmonious World of Sustained Peace and Common Prosperity Mankind has only one home - the Earth. Building a harmonious world of sustained peace and common prosperity is a common wish of the people throughout the world as well as the lofty goal of China in taking the road of peaceful development. China holds that the harmonious world should be democratic, harmonious, just, and tolerant. - Upholding democracy and equality to achieve coordination and cooperation. All countries should, on the basis of the UN Charter and the Five Principles of Peaceful Coexistence, promote democracy in international relations through dialogue, communication and cooperation. The internal affairs of a country should be decided by its people, international affairs should be discussed and solved by all countries on an equal footing, and developing countries ought to enjoy the equal right to participate in and make decisions on international affairs. All countries should respect each other and treat each other equally. No country is entitled to impose its own will upon others, or maintain its security and development at the price of the interests of others. The international community should oppose unilateralism, advocate and promote multilateralism, and make the UN and its Security Council play a more active role in international affairs. When dealing with international relations, it is necessary to persist in proceeding from the common interests of all the people throughout the world, make efforts to expand common interests, enhance understanding through communication, strengthen cooperation through understanding and create a win-win situation through cooperation. - Upholding harmony and mutual trust to realize common security. All countries should join hands to respond to threats against world security. We should abandon the Cold War mentality, cultivate a new security concept featuring mutual trust, mutual benefit, equality and coordination, build a fair and effective collective security mechanism aimed at jointly preventing conflict and war, and cooperate to eliminate or reduce as much as possible threats from such non-traditional security problems as terrorist activities, financial crises and natural disasters, so as to safeguard world peace, security and stability. We should persist in settling international disputes and conflicts peacefully through consultations and negotiations on the basis of equality, work together to oppose acts of encroachment on the sovereignty of other countries, interference in the internal affairs of other countries, and willful use or threat of use of military force. We should step up cooperation in a resolute fight against terrorism, stamp out both the symptoms and root causes of the problem of terrorism, with special emphasis on eliminating the root cause of the menace. We should achieve effective disarmament and arms control in a fair, rational, comprehensive and balanced fashion, prevent the proliferation of weapons of mass destruction, vigorously promote the international nuclear disarmament process, and maintain global strategic stability. - Upholding fairness and mutual benefit to achieve common development. In the process of economic globalization, we should stick to the principle of fairness, achieve balanced and orderly development, and benefit all countries, developing countries in particular, instead of further widening of the gap between South and North. We should propel economic globalization towards the direction of common prosperity. The developed countries should shoulder greater responsibility for a universal, coordinated and balanced development of the world, while the developing countries should make full use of their own advantages to achieve development. We should actively further trade and investment liberalization and facilitation, remove all kinds of trade barriers, increase market access, ease restrictions on technology export, so as to establish an international multilateral trading system that is public, fair, rational, transparent, open and nondiscriminatory, and construct a good trading environment conducive to orderly global economic development. We should further improve the international financial system to create a stable and highly efficient financial environment conducive to global economic growth. We should step up worldwide dialogue and cooperation on energy, and jointly maintain energy security and energy market stability. We should actively promote and guarantee human rights to ensure that everyone enjoys equal opportunities and right to pursue overall development. We should make innovations in the mode of development, promote the harmonious development of man and Nature, and take the road of sustainable development. - Upholding tolerance and opening to achieve dialogue among civilizations. Diversity of civilizations is a basic feature of human society, and an important driving force for the progress of mankind. All countries should respect other country's right to independently choose their own social systems and paths of development, learn from one another and draw on the strong points of others to make up for their own weak points, thus achieving rejuvenation and development in line with their own national conditions. Dialogues and exchanges among civilizations should be encouraged with the aim of doing away with misgivings and estrangement existing between civilizations, and develop together by seeking common ground while putting aside differences, so as to make mankind more harmonious and the world more colorful. We should endeavor to preserve the diversity of civilizations and development patterns, and jointly build a harmonious world where all civilizations coexist and accommodate one another. Over the years, China has persisted in the policies of peace, development and cooperation, and pursued an independent foreign policy of peace. In the spirit of democracy, harmony, justice and tolerance, China has been playing a constructive role, and making efforts to attain the lofty goal of building a harmonious world together with all other countries. China is working hard to bring about a just and rational new international political and economic order, and stands for greater democracy in international relations. China adheres to the purpose and principles of the UN Charter, attaches great importance to the UN's role in international affairs as the core of the international multilateral mechanism, vigorously promotes multilateral cooperation to settle regional conflicts and development problems, and actively supports the UN to play a greater role in international affairs. China backs up UN reform, and firmly helps safeguard its long-term interests and the common interests of its members. China has joined more than 130 inter-governmental international organizations, including the International Atomic Energy Agency (IAEA), is committed to 267 international multilateral treaties such as the Treaty on the Non-Proliferation of Nuclear Weapons, and actively participates in international cooperation in such fields as anti-terrorism, arms control, non-proliferation, peacekeeping, economy and trade, development, human rights, law-enforcement, and the environment. China takes practical steps to establish fraternal relations with surrounding regions and promote cooperation in maintaining regional security. In line with the generally acknowledged principles of international law and in the spirit of consultation on the basis of equality, mutual understanding and mutual accommodation, China has made efforts to properly resolve boundary issues with neighboring countries, settle disputes and promote stability. So far, thanks to joint efforts with various countries, China has signed boundary treaties with 12 continental neighbors, settling boundary issues left over from history. The boundary issues with India and Bhutan are in the process of being settled. China actively promotes dialogue and cooperation on regional security, and plays a positive and constructive role in such regional mechanisms as ASEAN + China, ASEAN + China, Japan and the ROK, Shanghai Cooperation Organization, Asia Pacific Economic Cooperation, ASEAN Regional Forum, and Asian Cooperation Dialogue. China has joined the Treaty of Amity and Cooperation in Southeast Asia, lending new vitality to the peaceful and friendly relationship between China and ASEAN members. China plays a constructive role in resolving weighty international and regional issues for common security. With respect to the nuclear issue on the Korean Peninsula, China has worked tirelessly with the other relevant parties, and succeeded in convening and hosting first the Three-Party Talks (China, North Korea and the United States) and then the Six-Party Talks (China, North Korea, the United States, the Republic of Korea, Russia and Japan). China was instrumental in getting the participants to issue a joint statement, thus mitigating tension on the peninsula, and contributing constructively to peace and stability in Northeast Asia. Regarding the Middle East issue, China encourages the parties involved to resume talks and start a new peace process based on relevant UN resolutions and the principle of "Land for Peace." As for the Iraq issue, China advocates seeking a political solution within the UN framework, and is making great efforts in this regard. On the Iran nuclear issue, China has tried several approaches to persuade the parties involved to engage in dialogue and find a proper and peaceful settlement within the IAEA framework. Moreover, China is expanding its participation in UN peacekeeping efforts, having sent military personnel, police and civil officers on 14 UN peacekeeping missions, to the number of 3,000. For many years, China has provided assistance within its capacity to other developing countries to help them build the capacity for self-development as well as engage in common development. So far, China has provided assistance to more than 110 countries and regional organizations for over 2,000 projects. China has reduced or canceled 198 debts totaling 16.6 billion yuan owed to it by 44 developing countries. In May 2005, the International Poverty-Reduction Center in China was formally set up in Beijing. In September 2005, at the High-Level Meeting on Financing for Development, on the occasion of the 60th Anniversary of the United Nations, President Hu Jintao announced the new measures China would adopt to increase assistance to other developing countries: China will give zero tariff treatment for certain products to all the 39 Least-Developed Countries (LDCs) having diplomatic relations with China, covering most commodities exported by these countries to China; further expand aid to Heavily Indebted Poor Countries (HIPCs) and LDCs; through bilateral channels, exempt or cancel in other ways within the next two years of all the outstanding interest-free and low-interest government loans due as of the end of 2004 owed by all the HIPCs having diplomatic relations with China; within the next three years, provide US$10 billion in preferential loans and preferential export buyer's credit to developing countries to help them strengthen the construction of infrastructure, promote enterprises of both sides to carry out joint venture cooperation; within the next three years, increase aid to developing countries, particularly aid to African countries in related areas, provide to them medicines including effective drugs to prevent malaria, help them build and improve medical facilities and train medical personnel; and train 30,000 persons of various professions from the developing countries within the next three years, and help relevant countries expedite the training of talented people. China continuously enhances exchanges and dialogues with other civilizations to promote mutual tolerance. Opening, tolerance and all-embracing are important features of Chinese civilization. As the trend of economic globalization develops in depth, China, all the more aware of the significance of exchanges and dialogues among different civilizations, is working harder to get the rest of the world to understand China, while absorbing and drawing on the useful fruits of other civilizations. In recent years, China has cooperated with numerous countries in holding Culture Weeks, Culture Tours, Culture Festivals and Culture Years, thus helping promote exchanges and understanding between the Chinese people and other peoples, and creating new forms for equal dialogue between civilizations. Conclusion China is the largest developing country in the world. The 1.3 billion Chinese people, taking the road of peaceful development, undoubtedly play a critical and positive role in the lofty pursuit of the peace and development of mankind. The Chinese government and people are well aware that China is still a developing country facing a lot of difficulties and problems on its road of development, and therefore it still has a long way to go before modernization is achieved. The road of peaceful development accords with the fundamental interests of the Chinese people; it also conforms to the objective requirements of social development and progress of mankind. China is now taking the road of peaceful development, and will continue to do so when it gets stronger in the future. The resolve of the Chinese government and the Chinese people to stick to the road of peaceful development is unshakable. The Chinese government and people also see clearly that peace and development, the two overriding issues facing the world, have not yet been fundamentally achieved. Local wars and conflicts arising from various causes keep erupting. Problems and conflicts in some regions remain complicated and thorny. Traditional and non-traditional factors threatening security are intertwined. The wealth gap between North and South continues to widen. People in some countries are still being denied the basic right to subsistence, and even survival. All this has made the road leading to a harmonious world characterized by sustained peace and common prosperity a bumpy and challenging one, and reaching the goal demands long and unremitting efforts by the people throughout the world. The 21st century has opened up bright prospects, and human society is developing at an unprecedented rate. China has identified its goal for the first 20 years of this century. That is, to build a moderately well-off society in an all-round way that benefits over one billion people, further develop China's economy, improve democracy, advance science and education, enrich culture, foster greater social harmony and upgrade the quality of life of the Chinese people. China is certain to make more contributions to the lofty cause of peace and development of mankind.

Circular of the State Council's General Office on the Distribution of "Suggestions on the Implementation of Policies and Measures Pertaining to the Development of the Western Region (29 September 2001) (English Text)

The following translation was retrieved from the Office of the Leading Group for Western Region Development of the State Council <A HREF="https://www.westchina.gov.cn/english/asp/start.asp?id=c">Web site</a> on December 7, 2005.<HR> Circular of the State Council's General Office on the Distribution of "Suggestions on the Implementation of Policies and Measures Pertaining to the Development of the Western Region” Submitted by the Western Region Development Office of the State Council (September 29, 2001) Governments of all provinces, autonomous regions and municipalities directly under the Central Government, all commissions, ministries and organizations directly under the State Council: The State Council has approved the Suggestions on the Implementation of Policies and Measures Pertaining to the Development of the Western Region submitted by the Western Region Development Office of the State Council. It is distributed to you herein and should be implemented earnestly. The General Office The State Council of the People's Republic of China Suggestions on the Implementation of Policies and Measures Pertaining to the Development of the Western Region (Submitted for Approval by the Western Region Development Office of the State Council on August 28, 2001) To carry out the strategy of developing the Western Region and accelerate the development of the middle and western regions is an important decision made by the Central Committee of CPC, showing great foresight and taking into consideration the overall interests of our country. In accordance with the Circular of the State Council on Policies and Measures Pertaining to the Development of the Western Region (Guofa [2000] No.33), the West Region Development Office of the State Council, in joint efforts with government agencies concerned, has further studied and formulated suggestions on the implementation of policies and measures pertaining to the development of the Western Region. I Scope of Application of Policies and Measures 1. The policies and measures pertaining to the development of the Western Region and suggestions on their implementation enacted herein are applicable to Chongqing Municipality, Guizhou Province, Sichuan Province, Yunnan Province, the Tibet Autonomous Region, Shaanxi Province, Gansu Province, the Ningxia Hui Autonomous Region, Qinghai Province, the Xinjiang Uygur Autonomous Region (Xinjiang Production Construction Corps separately listed), the Inner Mongolia Autonomous Region, the Guangxi Zhuang Autonomous Region (these areas hereafter abbreviated as the Western Region). With regard to ethnic minority autonomous prefectures located in other provinces (the Xianxi Tujia-Miao Autonomous Prefecture of Hunan Province, the Enshi Tujia-Miao Autonomous Prefecture of Hubei Province, and the Yanbian Korean Autonomous Prefecture of Jilin Province), preferential treatments could also be applied to them in the light of related policies and measures. II Increase Investment in Development 2. The proportion of funds in the central budget that are earmarked for the Western Region should be increased, including central funds for capital construction and funds raised through treasury bonds. In the allocation of loans from state policy-mandated banks and concessional loans from international financial organizations and foreign governments in accordance with lending terms, vigorous efforts should be made to direct as much capital as possible towards projects in the Western Region and increase the proportion of loans taken by the Western Region. 3. In the Western Region, new major infrastructure projects set up by the State should mainly be funded by development funds out of the central budget, other special development funds, bank loans, foreign capital and capital raised by enterprises themselves, and no funding gaps should be allowed in the implementation of these projects. Local governments should provide their due support actively with regard to land use and fee deduction etc. It is a necessity to concentrate resources on the construction of major projects that will steer the entire Western Region Development Program, such as West-East Gas Pipeline Project, West-East Power Transmission Project, Qinghai-Tibet Railway Project, national trunk highways, and water resources development and water saving projects. 4. The Central Government will strive to support major projects in the Western Region Development Program by raising special funds with various means for the exclusive use of Western Region development. The ministries of railway, communications, water resources, agriculture, forestry, and information industry etc. should continue to increase the proportion of funds invested in the major projects for the Western Region in their arrangement of construction capital. III Prioritize Construction Projects 5. The layout of construction projects in the Western Region should be under the guidance of scientific planning and bring into full play both planning and market forces in the allocation of resources. And priority should be given to projects in the following fields: infrastructure development such as water conservancy, highways, railways, airports, pipelines and telecommunications; eco-system improvement; agriculture that takes advantage of local characteristics; the exploitation and utilization of advantageous energy and mineral resources such as hydropower, high-quality coal, oil, natural gas, copper, aluminum, potassium and phosphorus etc.; urban infrastructure development; tourism that takes advantage of local characteristics; the industrialization of high and new technologies and military technologies converted to civilian use. IV Increase Transfer Payment to the Western Region 6. General transfer payment to the Western Region, especially to Ethnic Minority Regions (autonomous regions, provinces entitled to the same preferential treatment as autonomous regions and autonomous prefectures), should be increased. As the financial strength of the Central Government improves, transfer payment from the Central Government to local authorities in the Western Region will be increased gradually. The calculation of general transfer payment is based upon the balance between standard revenue and expenditure of local governments. In accordance with scientific and reasonable rules, standard revenue and expenditure are calculated with unified formula, not subject to the influence of subjective factors. In the allocation of general transfer payment funds, proper preference should be given to Ethnic Minority Regions. Starting from 2000, the Central Government has arranged part of the central budget for special transfer payment to Ethnic Minority Regions. 7. Priority should be given to the Western Region in the distribution of special subsidies from the Central Government. More funds should be channeled to the Western Region for the development of agricultural science and technology, arid agriculture, water-saving agriculture, protection and construction of agricultural ecological environment, and prevention and control of plant diseases and insect pests. Support should be given to the exploitation and utilization of cloud water resources in the sky and the monitoring and forecast of water and soil conditions and sand storms in Northwestern China. The investment in the comprehensive development of agriculture in the Western Region should be increased to improve the basic agricultural production conditions and eco-system, focusing the upgrading of middle and low yield fields; great efforts should be made to develop agriculture of high-quality, high-yield and high efficiency and promote the industrialization of agriculture; demonstration areas of modern agriculture and agricultural science and technology should be built selectively. Starting from 2001, in the comprehensive development of agriculture in the Western Region, the proportion of supportive funds from local finance could be reduced properly in accordance with local conditions, but investment in land improvement and consolidation should be scaled up. As for the provinces (autonomous regions, municipalities directly under the Central Government) with difficulties in finance in the West Region, if they have encountered expenditure increases due to the implementation of the 1999 policy that raised the salaries of government employees and the income of urban low-income residents, the Central Government will subsidize these provinces properly out of the central budget. The amount of subsidy will be based on local factors including the number of working and retired employees, monthly salary per capita, increment of pension, and subsidy coefficient of transfer payment. Proper preference will be given to the Western Region when the Central Government subsidizes such local expenditures as living wages for workers laid off by SOEs, basic pension for SOE retirees, and minimum living standard guarantee payment to urban residents. Preference will also be given to the Western Region in the allocation of special subsidies for education, science and technology, health care, legislation and law enforcement, culture, and cultural relic protection etc. 8. Poverty-stricken areas in the Western Region should be given priority in the allocation of central budget funding for poverty alleviation. Along with the improvement of the central finance, poverty alleviation funds for poverty-stricken areas and Ethnic Minority Regions in the Western Region should be scaled up, mainly for infrastructure development, crop farming and livestock breeding, rural elementary, vocational and technical education, culture and health care, and the popularization of advanced applicable technologies and related training. 9. To implement natural forests protection projects, the State will render support in the arrangement of investment in capital construction, special subsidies out of the central budget and subsidies intended to mitigate losses of local finance. The investment in capital construction includes subsidies for closing hillsides to facilitate afforestation and grass cultivation, aerial sowing for afforestation, reforestation, and the construction of seedling nurseries. Special subsidies out of the central budget covers operation expenses of forest management and protection, subsidies for pension contribution of state-owned forestry enterprises, subsidies for policy-oriented social expenses, subsidies for minimum living standard guarantee payments to laid-off workers, and subsidies for one-off settlement payment to laid-off workers. If local finance revenue decreases due to the implementation of natural forest protection projects, the Central Government will compensate local governments for a certain period of time. If forestry enterprises are made insolvent and become incapable of paying back bank loans due to compulsory wood yield reduction, these loans should first be suspended for auditing and liquidation, and related debts should be settled through writing off bad and doubtful accounts. 10. Pilot projects should be carried out to convert cultivated land back into forestry and pasture. Farmers who have withdrawn from cultivated land should be compensated in the form of grain for a certain period of time: the State will subsidize farmers with 150-kilogram grain per year for each mou (=0.1644 acre) of cultivated land converted to forestry or pasture in the upper reaches of Yangtze River and 100-kilogram unprocessed grain per year in the upper and middle reaches of Yellow River. The funds used to purchase grain for compensation (at 1.4 yuan per kilogram of unprocessed grain) will be appropriated from the central budget while local finance covers the expenses for the transportation of grain. Meanwhile, the Central Government will also provide farmers with cash subsidy at 20 yuan per mou of cultivated land converted to forestry or pasture. In addition, the State will provide farmers with seedling subsidy at 50 yuan per mou of cultivated land converted to forestry or pasture or barren land afforested or clothed with grass; such subsidy should be arranged out of central budget funding for infrastructure development. If the conversion of cultivated land back into forestry and pasture incurs losses of local finance revenue, the Central Government will also compensate local governments for a certain period of time. Moreover, active support should be given to sand control efforts. 11. If township finance meets insurmountable difficulties resulting from rural taxation and fee reform, the Central Government will compensate township governments properly in the form of transfer payment. V Give More Financial and Credit Support to the Western Region 12. More credit support should be given to infrastructure development in the Western Region, focusing on the construction of large and medium-sized communications and energy projects such as railway, trunk highway, power, oil, and natural gas etc. Infrastructure projects requiring large investment and long lead-time can be given a proper grace period on the basis of the building progress and debt-servicing capacity. Accordingly, the maturity period of loans granted by the State Development Bank of China to highway projects could be extended to 18 years, provided these loans account for no less than 40% of the total construction capital and are granted under terms of unified borrowing and repayment; the maturity period of loans granted to hydropower generation projects could be extended to 25 years; the maturity period of loans granted to non-hydro power generation projects could be extended to 18 years (and 20 years at a maximum), provided these projects are part of the West-East Power Transmission Project and each loan does not exceed 300 million yuan; the maturity period of loans granted to urban infrastructure projects could be extended to 10 years; and to 15 years at a maximum for other types of infrastructure projects. 13. Loans should be granted to a wider range of infrastructure projects that use tolling right or project's future returns as mortgage. Lending against future returns mortgage to rural power grid projects should be maintained; lending against tolling right mortgage to highway projects should be carried out; efforts should be made to extend such lending operations to urban infrastructure projects including water supply, heat supply, public transport and telecommunications etc; if possible, to water conservancy projects and urban environmental protection projects such as those treating sewage and garbage, provided these projects are of good debt-serving capacity. 14. More credit support should be given to agriculture and ecological improvement. Credit support should be provided to develop agriculture with western characteristics, water-saving agriculture and ecological agriculture, targeting at those leading enterprises that show good prospect, play a driving role and engage farmers in production. Agricultural Bank of China and rural credit unions should actively expand their petty loan operations and grant normal loans to farmers who have good debt-serving capacity. More loans should be made to ecological improvement projects on a selective basis. To support the conversion of cultivated land back to forestry and pasture and closing off hillsides to facilitate afforestation, more loans should be granted to projects of good debt-serving capacity that grow fast-growing high-yield timber, commercial forest, edible wild herbs and traditional Chinese medicinal materials and projects that develop private-owned seedling nurseries. 15. Credit leverage should be used to facilitate economic restructuring and industrial restructuring in the Western Region. To facilitate the development of sectors in the Western Region with competitive edge such as power, natural gas, tourism and biological resources, loans to major projects that demand large amount of capital may be made directly from the headquarters of commercial banks; such loans should not be taken into account in the examination of deposit loan ratio or loan limit of local branches of these commercial banks. Loans to finance rural power grid upgrading in the Western Region should be arranged and granted unitedly by Agricultural Bank of China. In addition, credit should also be granted to support industrial technological upgrading and the development of high-tech enterprises and small and medium-sized enterprises in the Western Region. VI Vigorously Improve Soft Environment for Investment 16. Policies concerning the reform and development of SOEs should be earnestly implemented to deepen SOE reform in the Western Region and turn these SOEs into real market players. The establishment of modern corporate system and corporate institutional innovation should be accelerated. The State must hold a controlling stake in strategic enterprises that concern the national economy and national security, but other state-owned large and medium-sized enterprises are encouraged to transform themselves into limited-liability companies or share-holding companies in accordance with law by listing their shares on the stock market, setting up joint ventures with foreign investors or holding each other's shares. After such reform, enterprises should set up the board of directors and the board of supervisors in accordance with law, and explicitly stipulate respective responsibilities of stockholders meeting, the board of directors, the board of supervisors and the management, ensuring that they fulfill their respective responsibilities and operate in a coordinated way and with effective check and balance. A regulatory framework concerning the management, operation and monitoring of state-owned assets should be established with clear division of labor to ensure that state-owned assets are invested timely and strengthen the external supervision over the management of state-owned assets. Enterprises need to further reform their labor, personnel and income distribution systems, gradually establishing new mechanisms that allow managers to be promoted or demoted, personnel to be employed or discharged and salaries to be raised or lowered. Coupled with industrial restructuring, the strategic readjustment of the layout of the state-owned sector should be carried out, adhering to the principles of "advancing in some aspects while retreating in others” and "focusing on certain tasks while putting other side”. The control over small and medium-sized SOEs should be further relaxed to enhance their vitality; great efforts should be made to strengthen the organization and management, policy framework and social service system of these small and medium-sized enterprises. Preferential support should be given to the reform and restructuring of SOEs in the Western Region aiming at turning them from losses to profits and disengaging them from difficulties. 17. Active efforts should be made to accelerate the development of the self-employed, private and other non-public sectors of the economy in the Western Region; meanwhile businesses and individuals in the middle and eastern regions are encouraged to invest in the Western Region. Domestic enterprises, regardless of their ownership category, should be given access to all investment fields that are open to foreign investment, except for those fields closed to domestic investment in accordance with special regulations. Such non-public economic entities as self-employed and private ones are encouraged to invest in the Western Region through sole investment, joint venture, economic cooperation and franchise etc. 18. The examination and approval procedures of project investment should be simplified. Except for major projects that have a significant bearing upon the national economy, its long-term development and national security and projects governed by special regulations, if enterprises, using either their own capital or bank loans, invest in projects in sectors that are opened for investment and need governmental intervention in balancing the construction and operation conditions of the project, competent authorities will only examine and approve the project proposal. It is up to investors to decide whether to start project construction after having made various arrangements for construction, and after staring construction, investors should report to competent authorities for record. 19. Policies and regulations concerning foreign investment formulated by the CPC Central Committee and the State Council should be implemented earnestly. Efforts should be made to optimize the regional layout of foreign investment, encourage foreign businessmen to invest in the Western Region and simplify the examination and approval procedures of projects with foreign investment. Except for major projects or projects governed by special regulations, if foreign investors, using their owned capital or commercial loans, invest in the Western Region in projects in sectors where investment is encouraged by the State or sectors with competitive edge, only the feasibility report should be submitted to competent authorities for examination and approval, and the project proposal and report on starting construction need not be submitted. The examination and approval procedures concerning contracts and regulations of foreign-invested enterprises will be simplified gradually. 20. Continuous efforts should be made to further change functions of the government, improve the soft environment for investment, rectify market order, and protect intellectual property rights earnestly and to safeguard rule of law in the economy. Efforts should also be made to separate government from enterprise management, reduce the number of matters requiring government examination and approval, standardize administrative procedures, and dispose and abolish rules and regulations that curb the development of socialist market economy and the opening-up to the outside world. As for matters really requiring government examination and approval, government departments at various levels should strive to provide convenient services and improve efficiency and transparency. The development of arbitration systems should be strengthened to deal with economic disputes timely and protect investors' lawful rights and interests. VII Implement Preferential Taxation Policy 21. The corporate income tax of enterprises in government-encouraged sectors that are financed either domestic or foreign investment in the Western Region should be collected at a reduced rate of 15% during the period of 2001-2010. Domestic enterprises in government-encouraged sectors refer to those enterprises whose main business falls into industries covered by the Catalog of Industries, Products and Technologies the State Encourages to Develop (revised in 2000) and generates more than 70% of the enterprise's total income. Foreign-funded enterprises in government-encouraged sectors refer to those enterprises whose main business falls into industries covered by the Industrial Catalog for Foreign Investment and the Catalog of Industries with Competitive Edge for Foreign Investment in the Middle and Western Regions and generates more than 70% of the enterprise's total income. Upon approval by the provincial-level government, domestic-funded enterprises based in autonomous regions, prefectures or counties may also be granted reduction or exemption of corporate income tax, and foreign-funded enterprises based in autonomous regions, prefectures or counties may be granted reduction or exemption of local income tax. The granting of income tax reduction or exemption to enterprises controlled by the Central Government is subject to examination and approval in accordance with related regulations. 22. New enterprises engaged in transport, power, water conservancy, postal service, broadcasting and television and etc. in the Western Region are eligible for preferential policies of income tax reduction and exemption. Particularly, domestic-funded enterprises are entitled to a two-year income tax holiday starting from the first day of business operation and a 50% reduction of corporate income tax for the next three years following the tax holiday; foreign-funded enterprises with expected operation period over ten years are also eligible for a two-year income tax holiday starting from the year of initial profit and a 50% reduction of corporate income tax for the next three years following the tax holiday. Herein transport enterprises refer to newly established enterprises that provide transport services through highway, railway, civil aviation, port, wharf and pipeline. Power enterprises refer to newly established enterprises engaged in the business of power generation, transmission and distribution. Water conservancy enterprises refer to newly established enterprises engaged in the development of water conservancy and flood control, including the comprehensive harnessing of rivers and lakes, flood control and water-logging elimination, irrigation, water supply, water resources protection, hydropower generation, water and soil conservation, river course dredging and the construction of riverbank and sea wall etc. Postal enterprises refer to newly established enterprises that provide postal services. Broadcasting and television enterprises refer to newly established enterprises in the business of broadcasting and television. If not subject to other prevailing regulations, the main business of the above-mentioned enterprises need to account for more than 70 % of the enterprise's total income to make it eligible for preferential tax policies stipulated hereinabove. 23. No special agricultural product tax should be levied for ten years starting the year of initial profit from special agricultural products produced by projects that convert cultivated land back into forestry and pasture for the purpose of ecological protection, provided that the size of ecological forests accounts for more than 80% of the total area converted. 24. By analogy with tax exemption in railway and commercial airport construction, no occupation tax should be collected for taking cultivated land to build state-level or province-level highways in the Western Region. This occupation tax-free policy is only applicable to the cultivated land occupied by highways and their two side trenches, but not applicable to the cultivated land occupied by stockyards, road maintenance crews, checkpoints, engineering teams and vehicle washing yards etc. located along the highways. It is up to provincial governments in the Western Region to decide on any reduction or exemption of taxes for taking cultivated land to build highways other than state-level and province-level ones. If land that should have been used to build state-level and province-level highways is occupied for other purposes, it will no longer eligible for exemption from occupation tax, which should be paid starting from the occupation. 25. If domestic or foreign investors invest in the Western Region in sectors where investment is encouraged by the government or sectors with competitive edge and need to import advanced technologies and equipment to facilitate projects with their investment, these imports, except for those not exemptible according to the Catalog of Non-Tax-Free Imports for Domestic Investment Projects (revised in 2000) and the Catalog of Non-Tax-Free Imports for Foreign Investment Projects, should be exempted from tariff and import VAT, provided that the imports are purchased within the total amount of investment. If foreign investors invest projects that conform to the Catalog of Industries with Competitive Edge for Foreign Investment in the Middle and Western Regions and need to import equipment to facilitate their projects, these imports should be exempted from tariff and import VAT, provided that the imports are purchased within the total amount of investment. The examination and approval procedures for such exemption should be implemented in accordance with the Circular of the State Council on the Adjustment of Tax Policies for Imported Equipment (Guofa [1997] No.37). VIII Implement Preferential Policies on Land Use 26. The government encourages afforesting activities, the cultivation of grass on barren mountains and infertile land and the conversion of slopes into forestry and pasture in a planned and step-by-step way in the Western Region. The government allows those economic entities or individuals engaged in afforestation and grass planting to own wood and grass in question and hold land tenure over such areas. Unutilized state-owned land such as barren hills and uncultivated land may be transferred without charge to economic entities and individuals for afforestation and grass planting aiming at ecological improvement, and such land tenure can remain in effect for 50 years. If economic entities and individuals holding land tenure have invested sufficient capital in afforestation and grass planting as required by the transfer contract and improved the ecology to the required level, they may transfer, lease or mortgage such land tenure, which can be renewed at the end of 50 years. The land tenure of barren hills and uncultivated land owned by rural collectives may be transferred to entities and individuals for 50 years through contracting, lease or auction for afforestation and grass planting aiming at ecological improvement, and such land tenure can be inherited, transferred, leased or mortgaged. 27. Basic farmland should be protected strictly, with a balance of farmland occupation and supplementation. To maintain local grain production capacity, in the areas where sloping cultivated land prevails, the long-cultivated land that slopes at 15-25 degree and has good facilities for irrigation and water and soil conservation can be classified as basic farmland in accordance with overall plans of land utilization, provided that this classification does not hamper ecological improvement; and newly-cultivated land that has good facilities for irrigation and water and soil conservation can also be classified as basic farmland. In accordance with regulations concerned, the productive layout of crop farming can be adjusted to facilitate the development of cash crop, provided that the adjustment does not damage tilling conditions. Priority should be given to basic farmland conservation zones in the allocation of land improvement and consolidation projects so as to continuously increase the area of tillable land within conservation zones and improve land quality. The State will increase its investment in land consolidation and reclamation in the Western Region. In principle, land use charges collected by provincial governments in the Western Region from new construction projects and turned over to the Central Government should be fully appropriated to support projects of land development and consolidation. Unutilized land should be developed into grassland or garden; if competent authorities classify unutilized land as tillable land, it should be protected and managed as tillable land and may be used to meet cultivated land quota. In accordance with the principle of maintaining a balance between the occupation and supplementation of cultivated land, cultivated land occupied by infrastructure development projects should be substituted by newly reclaimed land, and reclamation charges can be collected at the minimum rate set by provincial governments in the Western Region. 28. The examination and approval procedures concerning land for construction should be simplified to improve efficiency and ensure that land is supplied timely for economic construction. With regard to proposals on land occupation for construction that require the final approval of the State Council, competent authorities mainly examine whether the proposal conforms to plans of land use and the balance between occupation and supplementation and whether compensation for land occupation is settled; such proposals should be simplified basing on what to be examined and approved. The settlement of compensation for land occupation should comply with such laws as Land Management Act; efforts should be made to prevent any unauthorized additional charges and protect farmers' interests. Compensation for land occupation can be exempted if state-owned unutilized land is occupied. If not governed by other laws and regulations, land use charges should be paid for the land occupied by construction projects, and land supply through tendering and auction is encouraged. If foreign investment projects do need to occupy land, upon approval, land tenure can be granted through equity participation and capitalization of land tenure. IX Implement Preferential Policies on Mineral Resources 29. In land and resources survey planning, priority should be given to the Western Region in the arrangement of survey and evaluation projects and related funds, focusing on the survey and evaluation work in concentration areas of important mineral resources and of minerals in short supply and underground water resources, and on the basic geological work in areas where geological work is underdeveloped and areas with severe geologic hazards. 30. In the Western Region, prospecting and mining rights stemming from state-funded surveying, upon approval, may be partially or fully transformed to state-owned equity of mining or prospecting SOEs if falling into one of the following categories: those SOEs engaged in the prospecting or mining of mineral resources such as oil, natural gas, coal-bed gas, iron-rich ore, high-quality manganese ore, chrome iron ore, copper, nickel, gold, silver, sylvite, platinum metals and underground water etc.; those SOEs prospecting or mining for mineral resources in key poverty-alleviation areas and key development areas designated by the State; large and medium-sized mining SOEs that need to prospect substitute resources due to resource depletion; equity participation with prospecting or mining rights by mining SOEs in their approved transformation into joint-stock companies or joint ventures; or those mining SOEs that are unable to pay for prospecting or mining rights due to irresistible reasons such as natural disasters etc. 31. In the Western Region, prospecting and mining enterprises may apply for reduction or exemption of the payment for prospecting or mining rights if falling into one of the following categories: the prospecting or mining of mineral resources such as oil, natural gas, coal-bed gas, iron-rich ore, high-quality manganese ore, chrome iron ore, copper, nickel, gold, silver, sylvite, platinum metals and underground water etc.; the prospecting or mining of substitute resources by large and medium-sized mining SOEs due to resource depletion; the exploitation of mineral resources with new technologies and means that improve the level of comprehensive utilization, including the exploitation of low grade mineral resources with difficulties in screening and smelting and the utilization of tailings; or other conditions recognized by competent authorities. The payment for prospecting rights can be exempted for the first year of prospecting, reduced by 50% for the next two years and by 25% for another four years following the two years. The payment for mining rights can be exempted during the period of mine construction and for the first year of mining, reduced by 50% for the next two years, by 25% for another four years following the two years and exempted again in the year of mine closure 32. With investment in prospecting and upon discovery of exploitable emplacement, prospecting rights holders may obtain mining rights through legal procedures. In such cases, prospecting expenses may be taken as deferred assets and amortized during the period of mining. 33. Active efforts should be made to cultivate a market of mineral properties and promote the legal transaction of prospecting and mining rights. Transferable mineral properties include those related orefields proved by state-funded prospecting, nationalized orefields and areas where mineral properties are not established. Apart from application for approval, mineral properties may be transferred through other means such as tendering and auction etc. Holders of prospecting or mining rights may transfer their rights through such legal procedures as sale, equity participation, joint prospecting or mining and listing on the stock market and may also lease or mortgage their rights in accordance with related regulations. 34. Apart from enjoying existing preferential policies, foreign investors engaged in the prospecting and mining of mineral resources other than oil and natural gas may also be exempted from paying for their prospecting and mining rights for one years and entitled to a 50% reduction for two years in the payment for prospecting and mining rights. Foreign investors engaged in the exploitation of non-oil and non-gas mineral resources that fall into the government-encouraged category in the Industrial Catalog for Foreign Investment are eligible for five-year exemption from paying mineral resource compensation fees. In Chinese-foreign joint ventures, if the Chinese investor invests through equity participation with prospecting or mining rights, such rights should be evaluated, confirmed and capitalized in accordance with related regulations, and the Chinese investor should submit related geological documents. X Regulate through Pricing and Fee-Charging Policies 35. The price reform should be deepened to enhance the effect of market forces on prices. The pricing of part of railway transport in the Western Region will no longer be set but guided by the government. The policy of floating prices will be implemented for feeder lines within provinces (autonomous regions or municipalities directly under the Central Government) in the Western Region. With regard to the pricing of ethnic minorities' traditional medicine listed in the medicine catalog of National Basic Medical Insurance for Urban Workers and Administrative Staff, competent provincial authorities of the province where such medicine is produced are authorized to examine and approve. 36. Power and water prices should be adjusted to promote the reform of fee charging related to sewage and garbage treatment. Active efforts should be made to resolve price differences among power grids in the Western Region, and the transmission and distribution tariffs of different power grids should be checked and ratified separately. Power generation enterprises are encouraged to directly sign power purchase contracts with their customers so as to reduce the power expenses of customers. The transmission costs of interconnection ties that connect major power grids in the Western Region to those in the Eastern Region should be lowered properly to facilitate West-East Power Transmission. With the precondition that rational development and bearing capacity are taken into consideration, water prices of water conservancy projects in areas short of water resources in the Western Region should be adjusted with priority so as to ensure that construction and maintenance costs of water conservancy projects are recovered reasonably. In cities in the Western Region where sewage treatment plants have been constructed but sewage treatment fees are not charged, sewage treatment fees should be collected as soon as possible in accordance with related regulations. In those cities where sewage treatment fees are charged, such fees should be raised gradually following the principle of breaking even and making meager profit, provided that the bearing capacity of local residents is taken into consideration. Governments in the Western Region should promote the fee-charging system for garbage treatment and may put forward their own fee-charging policies for garbage treatment while considering local conditions. 37. Special transport prices should be set for newly built railways and feeders in the Western Region. In accordance with the "new railway, new price” policy formulated by the State Council, special transport prices for newly built railways in the Western Region can be set following the principles of enabling the repayment of principal and interest of loans and reasonable recovery of operation costs, so as to ensure the repayment of loans made to new railway projects, enable railways' normal operation and facilitate the construction of railways in the Western Region. It is necessary to further study the options of resolving price differences between special transport prices of new railways in the Western Region and unified transport prices of the national railway network. Special transport prices should be set for railway feeders in the Western Region. Competent authority under the State Council is responsible for formulating pricing principles concerning railway feeders in the Western Region; competent authority under the provincial government in the Western Region is in charge of setting prices. If conditions permitting, government-guided pricing or even market-regulated pricing can be applied to railway feeders in the Western Region; railway transport enterprises may have some pricing power in this regard. XI Open Up More Investment Fields to Foreign Investors 38. Foreign investors may enjoy all preferential policies under the category of sectors where foreign investment is encouraged by the government, if they invest in basic industries, infrastructure development or resource exploitation in the Western Region, including agriculture, forestry, water conservancy, transport, energy, municipal public utilities, environmental protection, mining, tourism etc., and in the establishment of research and technology development centers. To expand opening-up of the Western Region to the outside world, the State will make timely supplement and revision to the Catalog of Industries with Competitive Edge for Foreign Investment in the Middle and Western Regions and related policy measures, in accordance with local economic development and changes. 39. A greater proportion of the service and trader sectors in the Western Region should be opened up to foreign investment. The pilot operations of foreign investment in banks and retail stores should be extended to central cities in the Western Region, including municipalities directly under the Central Government, capital cities of provinces and autonomous regions. The piloting of foreign trade joint ventures should also be extended to central cities in the Western Region, and both Chinese and foreign investors should be given more flexible treatment than in the Eastern Region in their qualification for setting up such foreign trade joint ventures. With China's accession to the WTO and within the legal framework of related agreements, preferential consideration should be given to request made by foreign banks in the Western Region for the engagement in RMB transactions; preferential permission should be given to application made by foreign insurance companies for setting up branches in the Western Region; preferential consideration should be given to foreign investors' request for setting up insurance agencies and insurance brokerage joint ventures. Proper flexibility should be allowed in the qualification examination and project approval concerning setting up Chinese-foreign joint-venture travel agencies in the Western Region. In accordance with China's WTO commitments and related regulations, foreign accounting firms are allowed to set up joint-venture accounting firms in the Western Region. If unable to set up joint venture, foreign accounting firms are then allowed to establish subsidiaries in the Western Region. Existing Chinese-foreign accounting joint ventures are encouraged to set up branches in the Western Region. Conditions permitting, Chinese-foreign cooperative law firms may be first set up in the Western Region. Foreign investors are allowed to set up Chinese-foreign cooperative ventures or joint ventures in the field of building, related service and architectural design and take controlling interest in such ventures. Foreign investors will be gradually allowed to set up foreign-funded enterprises in the fields of building and related services, designing service, engineering service and urban planning service. Foreign investors will be gradually allowed to have controlling interest in Chinese-foreign railway cargo joint ventures and highway cargo joint ventures and to set up foreign-funded railway cargo and highway cargo enterprises. XII Open More Channels for Foreign Capital Utilization 40. It is necessary to work out administrative procedures for the Western Region concerning the listing of foreign-invested enterprises on stock market at home and abroad, foreign investment in domestic-funded enterprises through management power transfer, equity transfer, merger and acquisition and foreign investment through Chinese-foreign joint industrial funds and venture capital funds. 41. Concessional loans from international financial organizations and foreign governments should be made best use of, particularly in education, health, poverty reduction and environmental protection in the Western Region. Active efforts should be made to seek more multilateral and bilateral grants, and priority is given to the Western Region in the arrangement of grant-funded projects. The Western Region should be timely informed of the administrative and applying procedures and priority areas of concessional loans, grants and ODA from international financial organizations and foreign governments. Assistance should be provided to the Western Region in the training of managers of ODA and grant projects, the improvement of project management, increasing transparency of project management and ensuring the Western Region obtains relevant inform timely. Top priority should be given to projects in environmental protection, agricultural development, basic education, health and water resources that have a long-term bearing on economic and social development in the Western Region. XIII Create More Favorable Condition for Foreign Capital Utilization 42. With regard to foreign investment in the Western Region in infrastructure and other sectors with competitive edge, the allowed proportion of equity held by foreign investors can be appropriately raised, and such increase should be differentiated across different sectors of investment. Foreign investors are allowed to manage their marketing and distribution businesses in the Western Region for 40 years, 10 years longer than in the Eastern Region; the required minimum registered capital can be lowed to 30 million yuan, 20 million yuan lower than in the Eastern Region. Foreign-funded enterprises based in China and Chinese-foreign joint ventures are encouraged to re-invest in the Western Region, and if the proportion of foreign capital in the registered capital of the re-investment enterprise is no less than 25%, the re-investment enterprise will be entitled to the same preferential treatment enjoyed by FDI enterprises. 43. With regard to foreign investment projects in the Western Region in infrastructure and other sectors with competitive edge, the allowed proportion of loans from domestic banks in RMB for fixed-asset investment can be appropriately increased. The limit of RMB borrowing can be extended to 120% of Chinese investors' capital in Chinese-foreign cooperative ventures or joint ventures; to 100% of registered capital in projects with exclusive foreign investment. If the project in question falls into the government-encouraged category in the Industrial Catalog for Foreign Investment and the Catalog of Industries with Competitive Edge for Foreign Investment in the Middle and Western Regions, the foreign investor has good credit standing and loans are made from domestic banks for the purchase of home-made equipment and materials and payment to domestic contractors of the project, the above-mentioned ceiling on RMB loans from domestic banks will not longer stand; in such cases, it is up to the domestic bank to make independent evaluation of the project and decide on the amount of loans. Foreign investment projects are allowed to carry out project financing, including that in RMB . 44. With regard to projects in the Western Region that utilizes foreign concessional loans, it is allowed to increase appropriately the proportion of such loans in the total amount of investment. Regarding to projects of infrastructure development, environmental protection and poverty reduction in the Western Region, on basis of the project's repayment capacity, the general requirement is that foreign concessional loans should account for no more than 50% of the total investment, but this ceiling can be raised to 70%, except for those loans with purchase limitation or other requirements imposed by the lending bank. Efforts should be made to strengthen the coordination between the planning of foreign concessional loans and the planning of government investment in the Western Region; the State will provide financial support to those key foreign investment projects in the development of the Western Region. XIV Vigorously Develop Foreign Trade and Economic Cooperation 45. Enterprises based in the Western Region should be granted more management power in foreign trade and economic & technical cooperation. In the granting of independent import-export operations right, the minimum requirement on the registered capital of manufacturing enterprises in the Western Region is lowered from 3 million yuan to 2 million yuan, and from 2 million yuan to 1 million yuan for research institutes, high-tech enterprises and enterprises that manufacture machinery and electrical equipment. Private manufacturing enterprises are entitled to the same treatment as manufacturing SOEs and collectively-owned enterprises in the application for independent import-export operations right. In the granting of operations right for overseas labor services to foreign trade enterprises based in the Western Region, the new minimum requirement is that the enterprise's total export-import volume reached 50 million USD in previous year or its export volume reached 30 million USD. Those prefectures (cities) where no foreign trade enterprise is engaged in overseas labor services may set up a state-owned foreign trade enterprise that provides such services exclusively, or designate a state-owned foreign trade company to apply for operations right for overseas labor services. 46. The Western Region is encouraged to promote the export of products with competitive edge. A production and service chain of organic agricultural products and related quality certification systems should be established in the Western Region; the transformation of achievements of organic agriculture research into production should be accelerated; areas free of specific epidemics and export-oriented production bases of livestock products should be developed; the export of organic agricultural products and livestock products should be expanded. As long as it complies with national industrial policies, the export quota of a product granted to its major manufacturing enterprises located in a province (or autonomous region, municipality) that is the main producer of such product should be increased gradually. The production of primary mineral products and agricultural and sideline products with competitive edge in the Western Region should develop toward the direction of downstream processing and high added value. 47. Enterprises based in the Western Region are encouraged to carry out overseas project contracting and provide overseas labor services. Active support should be given to large construction companies based in the Western Region in their application for business qualification for overseas project contracting and labor services, and in project contracting, information acquisition and corporate financing. Incentives should be provided to large SOEs under the Central Government to promote their cooperation with enterprises based in the Western Region in overseas project contracting and labor employment, helping western enterprises expand their international business. The cooperation between large enterprises at home and abroad and enterprises based in the Western Region should be promoted to encourage their joint contracting of infrastructure projects in the Western Region that utilize foreign capital. 48. Enterprises based in the Western Region are encouraged to invest in foreign countries and set up factories there, especially in neighboring countries and regions. Priority should be given to enterprises based in the Western Region in processing applications for setting up overseas processing and trade enterprises or for contracting overseas Chinese-aid projects or foreign-Chinese cooperative projects. Priority should also be given to qualified enterprises based in the Western Region in approving applications to the Central Foreign Trade Development Funds for capital to set up overseas processing and trade enterprises. 49. Proper preferential treatment should be given to enterprises based the Western Region in processing their import of technology and equipment in urgent need for the economic development of the Western Region. Import restrictions can be relaxed appropriately for the import of products that are urgently needed in Ethnic Minority Regions and will be used for production there. On a case-by-case basis, preferential treatment can be given to the Western Region in the arrangement of import quotas. 50. In conformity with international norms, preferential border trade policies should be continued in border areas, simplifying procedures and easing restrictions on export tax refund, the scope of imports and exports, quotas for commodity import and export, license control and entry and exit of people. In accordance with relevant regulations formulated by competent central authorities, competent authority within the provincial government is responsible for the registration, administration and record keeping of border trade operations right. The government of the border province is in charge of the examination and approval of contracts concerning Chinese border trading companies' project contracting and labor services in the border areas of neighboring countries. Border trading companies exporting local products that are subject to the license management of export quota should be exempted from license management, expect for the export of commodities subject to national unified bidding, important industrial products subject to aggregate control, commodities subject to voluntary quota management, commodities subject to quota compensation management, border exports subject to focused management, military-civilian dual-use chemicals, chemicals that could easily used to manufacture narcotics and substance that depletes ozone layer. If border trading companies export local products subject to quota compensation management, the restriction on their export qualification may be eased and the payment for using quota be exempted or reduced. In the case of border trading companies exporting through border trade commodities subject to national focused management, competent authority under the State Council should allocate a number of special quotas, and distribute sufficient quotas on the equipment, materials and personal means of livelihood carried by border trading companies and their employees to border areas of neighboring countries to facilitate their economic and technical cooperative projects. To reduce the operation costs of border trading companies, only government agencies authorized by the State with unified regulations can collect administrative charges at customs ports. XV Promote Regional Cooperation and Counterpart Aid 51. Regional economic and technical cooperation should be promoted. In accordance with national industrial policies and on the basis of making a full play of regional comparative advantages, the eastern and middle regions and the Western Region should carry out all-round economic and technical cooperation that is market-oriented, efficiency-centered, based on mutual benefits and the involvement of enterprises as main players. By analogy with preferential policies enjoyed by foreign investors, strong measures should be adopted to improve investment environment and service level and support enterprises based in the eastern and middle regions to invest in the Western Region through sole proprietorship, equity participation, merger and acquisition, consortium, lease, contracting and etc. and to set up factories and be engaged in cooperative development. In such cooperation, it is forbidden to transfer to the Western Region production facilities that should have been weeded out, obsolete processes and technologies and projects that severely pollute the environment. 52. Counterpart aid and assistance should be strengthened. Eastern provinces, municipalities directly under the Central Government and municipalities with independent budgetary status should, basing on their own advantages and local characteristics of their western counterparts receiving aid, continue to construct elementary schools, secondary schools, health centers and cultural activity stations in counterpart-aid areas in the Western Region and to organize itinerant education, itinerant health care and technological consulting and demonstration in these target areas. Basing on local conditions, eastern provinces and municipalities can raise funds for the exclusive use of counterpart aid. The work of poverty reduction with petty loans should be continued, targeting at farmers in poverty-stricken areas in the Western Region. The campaign named "Development the frontier and help frontiersmen prosper” should be carried out in a planned way, focusing support on Ethnic Minority Regions and poverty-stricken border counties, and great efforts should be made to carry out pilot projects and put assistance measures into effect at the grassroots level in these regions and counties. XVI Attract and Make Good Use of Talents 53. Starting from 2001, the system of distributing hardship allowances to those people working in harsh, remote or frontier areas should be established, with funds coming from the central budget. The salaries for personnel of government agencies and public institutions in harsh, remote or frontier areas should be gradually raised to reach the national average level or even a higher level, aiming at encouraging talented people to work in these areas. 54. The enthusiasm and creativity of professional talents in the Western Region should be mobilized. With regard to senior technicians who have reached the retirement age but are still undertaking major economic construction projects or working in harsh, remote or frontier areas, they, if urgently needed and in short supply, may be employed in extension upon the approval by the competent authority within the provincial government, and they should not be included in the counting of the authorized size of the organization and the number of technician posts in the organization. Great efforts should be made to select experts and award them special government allowances, set up postdoctoral research centers and enterprises-owned postdoctoral research centers and to subsidize the research of researchers returning from abroad after completion of higher learning. The working conditions and living standard of high-level talents in the Western Region should be further improved, and they should be given preferential treatment in the appropriation of research funds, the appointment of assistants and their project application. 55. Talent training in the Western Region should be strengthened. Linked with the implementation of key tasks of Western Region development, key construction projects and important research programs, the training of talents in the Western Region should be strengthened, in the form of local training, training in the Eastern Region or overseas training. More guidance and support should be provided to the training of ethnic minority talents, young and middle-aged leading scientists and civil servants. Training funds should be increased to support the development of training institutes and training staff. Special funds from the central budget should be made full use of, and international aid should be sought vigorously. Priority support should be given to the training of talents in the Western Region. 56. Talents and intelligence are encouraged to move to the Western Region. Talents working in other regions are encouraged to engage themselves in the development of the Western Region through part-time employment, short-term employment, research consignment, cooperative research, equity participation with technology and contracting for management power. Domestic senior experts, outstanding postdoctoral talents and Chinese students and scholars returning from overseas study will be invited to conduct field surveys in groups in the Western Region and provide consulting services, or to provide distant service with means of modern telecommunication and internet technologies. In the Western Region, if conditions permitting, business initiation parks should be established for talents returning home after having studied abroad, and advantages of the parks such as technology intensiveness, complete facilities and preferential policies should be made full use of to attract talents returning home after having studied abroad and encourage them to set up high-tech companies or develop high technologies in the parks. 57. The counterpart aid of talents and intelligence should be carried out. With reference to economic counterpart aid between the Eastern Region and Western Region, similar counterpart aid relations should be shaped up to connect the two regions in human resource development, and main aid projects should be defined. The exchange of scientific and technological talents between the two regions is supported to facilitate the sharing of talents and information. The exchange of government officials between the two regions should be expanded. The original salaries and fringe benefits of talents who move to work in the Western Region under counterpart aid programs should be retained during their working period in the Western Region, and their temporary employers in the Western Region may award them supplementary allowances in accordance with actual conditions. 58. The policy of free movement of talents working in the Western Region should be implemented. The talent's personal files can be archived at his original place of work or be transferred to his new employer in the Western Region; the personnel files can also be consigned to a talent exchange agency under competent authority located in the place where the talent used to work or is working. College graduates going to work in the Western Region may transfer his hukou (permanent residence registration) to the place of employment or domicile of origin, and the talent exchange agency under local competent authority should manage their personal files, free of charge for the first five years, and provide other personnel services related to the adjustment of file wage and appointment of professional titles. With regard to those talents who have come to the Western Region to invest, set up companies or devote themselves to the development of the Region, they can move their hukou to its previous place of registration if they return to the Eastern Region. With regard to those talents who have been assigned to work with major tasks and construction projects of the Western Region Development Program, they may retain their hukou at its original place and keep their employment relationship with their original employer and enjoy the same treatment as their colleges at their original working place in terms of promotion, appointment of professional and technical titles and salary increase; personal problems such as being separated from one's spouse due to job transfer should be solved with priority, and if possible, the new employer in the Western Region should purchase accidental injury insurance for these talents. Graduates of universities, college and technical secondary schools going to work in harsh, remote or frontier areas may have their wage scale graded in advance, and even have their wage scale graded higher than normal level in accordance with local conditions. The Western Region should accelerate the reform of personnel and employment system, and allow people who have retained their original hukou to move to the Western Region to invest and be engaged in construction. 59. Entry and exist facilitation should be provided to foreign high-tech talents, high-level management talents and investors: including foreign high-tech talents and high-level managers who come to the Western Region to execute state-level or province-level Sino-foreign cooperative scientific and technological projects or major construction contracts signed by the Central Government or

Circular of the State Council on Policies and Measures Pertaining to the Development of the Western Region (26 October 2000) (English Text)

The following translation was retrieved from the Office of the Leading Group for Western Region Development of the State Council <A HREF="https://www.westchina.gov.cn/english/asp/start.asp?id=c">Web site</A> on December 7, 2005.<HR> Circular of the State Council on Policies and Measures Pertaining to the Development of the Western Region (October 26, 2000) Carrying out the strategy of developing the Western Region and accelerating the development of the central and western regions are important components of China's modernization drive, representing a major decision on the part of the Central Committee of the CPC. This decision is based on a broad, long-term view of the situation and takes into consideration the overall interests of our country in the new century, and therefore is of great political and economic significance. The State Council has formulated a number of policies and measures for developing the Western Region that embody the government's focused support for the region. Following are some matters related to that decision. I. Principles governing policy-making and focuses of support 1. Principles governing policy-making. The development of the Western Region is a large-scale, systemic campaign as well as a formidable historic mission. It requires a sense of urgency and we must be well prepared for the protracted difficult struggle. We must proceed from reality and follow the objective laws. We need to aim high while still staying within our means. We have to build on our existing resources but keep in mind long-term growth. We must make overall plans by taking all factors in consideration and conduct scientific evaluation. We must determine priorities, do things step by step, avoid blindness and rushing headlong into mass actions and fight extravagance. We must speed up the transformation of our mind, deepen reform and opening up and implement the strategy of reinvigorating our country through science and education and the sustainable development strategy. We should combine market forces with improved macroeconomic management, and combine nation-wide support for Western Region Development with the spirit of self-reliance among the people in the Western Region. 2. Priority tasks and strategic goals. The priority tasks for the present and near future include speeding up infrastructure development, strengthening environmental protection and ecological improvement, consolidating the fundamental position of agriculture in the national economy, restructuring industry, promoting tourism that takes advantage of local characteristics, and developing science, technology, education, culture and public health. Great efforts should be made in the next five to ten years to achieve breakthroughs in infrastructure development and ecological improvement in the Western Region and create a good start for Western Region Development. By the middle of the 21st century, the Western Region will be transformed into a prosperous and advanced new West, where life is stable, ethnic groups are united, and the natural landscape is beautiful. 3. Priority localities. The policies for Western Region Development are applicable to the municipality of Chongqing, Sichuan province, Guizhou province, Yunnan province, the Tibet Autonomous Region, Shaanxi province, Gansu province, the Ningxia Hui Autonomous Region, Qinghai province, the Xinjiang Uygur Autonomous Region, the Inner Mongolia Autonomous Region and the Guangxi Zhuang Autonomous Region. Large-scale development of the Western Region will rely on major transport routes such as the Asia-Europe continental bridge, the Yangtze River waterway and the routes to the sea in Southwestern China when bringing the region's major cities into play. These major transport routes will specifically serve the region by linking up major cities to gradually form a network of inter-provincial economic zones such as the area spreading along the Western Longhai Railway and Lanzhou-Xinjian Railway, the Nanning-Guiyang-Kunming area and the upper reaches of the Yangtze River. This formation of these economic zones will promote the development of other areas and allow the overall development of the region to proceed in an orderly and focused manner. II. Policies for increasing investment 1. Increasing investment in development. The proportion of funding earmarked for Western Region Development in the central budget needs to be increased. When allocating loans from state policy-mandated banks and concessional loans from international financial organizations and foreign governments in accordance with lending conditions, vigorous efforts should be made to direct as much capital as possible toward projects in the Western Region. New major infrastructure projects set up by the state should mainly be funded by development funds out of the central budget and other special development funds, bank loans and foreign capital, and funding gaps should be prevented in the implementation of these projects. The central government will employ various methods to raise special development funds for the Western Region. Central government agencies concerned should fully manifest their support for Western Region Development when formulating sector development plans and policies and allocating special funds. Enterprises are encouraged to invest in major development projects in the Western Region. 2. Prioritizing development projects. Priority should be given to the Western Region when arranging infrastructure projects in the areas of water conservancy, transport, energy and etc., projects exploring and exploiting resources with a competitive edge, and projects industrializing high and new technologies with unique features and military technologies converted to civilian use. Efforts should be made to establish the corporate responsibility system for projects, project capital system, competitive bidding system, project quality monitoring system, and environment monitoring system, and to improve preparatory work for development projects. 3. Increasing transfer payments to local governments. As the financial strength of the central government improves, transfer payments from the central government to local authorities in the Western Region should be gradually increased. Priority should be given to the Western Region in the distribution of special subsidies for agriculture, social security, science and education, health care, family planning, culture and environmental protection. In addition, poverty-stricken areas in the Western Region should also be favored in the allocation of central budget funding for poverty alleviation. The central government is responsible for providing the majority of gain and seedling subsidies and cash subsidies pertaining to the implementation of state-approved projects that convert cultivated land to forestry and grassland, protect natural forests and prevent and eliminate desertification. The central government will provide proper compensation for losses of local financial revenue incurred by the implementation of projects that convert cultivated land to forestry and grassland and protect natural forests and etc. 4. Giving more financial and credit support to the Western Region. While retaining the right to choose projects on the basis of commercial viability, banks should increase the scale of credit that supports the development of basic industries in the Western Region, focusing on railway projects, highway trunk-line projects and large and medium-sized power, oil and natural gas projects. The process of determining which projects should receive loans coupled with matching funds from treasury bonds should be accelerated to ensure that loans are available when needed as projects progress. Infrastructure projects requiring large investment and long lead time can be given a reasonably longer grace period on the basis of the longer building time and debt-servicing capacity. In addition, the State Development Bank of China will increase lending to the Western Region an annual basis, and loans will be provided to more infrastructure projects that use rights of collecting fees or claiming project return as mortgage. Greater credit support will be given to agriculture, environmental protection and ecological improvement, industries with a competitive edge, small city and town development, technology upgrading, and development of hi-tech and new-tech businesses and small and medium sized enterprises in the Western Region. Vigorous efforts should be made to provide student loans and loans that support the construction of student dormitories. Loans to finance power grid upgrading in rural areas and key projects in competitive-edge sectors that demand a large amount of capital should be made directly from the headquarters of the Agricultural Bank of China and head offices of other commercial banks. Joint stock banks are encouraged to set up branches gradually in the Western Region. III. Policies for improving the investment environment 1. Working hard to improve the "soft" environment for investment. The reform of SOEs in the Western Region should be deepened. The establishment of a modern enterprise system in these SOEs should be accelerated. Strategic restructuring of the state-owned sector and reorganization of the assets of SOEs should be carefully implemented. Greater support should be given to SOEs' technological upgrading and efforts to lighten the burdens of SOEs and bring them out of difficult situations. Greater efforts should be made to develop commodity and key material markets in the region. Concrete efforts should be made to accelerate the development of the self-employed, private and other non-state sectors in the region. In principle, all businesses, regardless their ownership category, should be given access to all investment fields which are open to foreign investors in line with relevant laws and regulations. The development of a credit guarantee system and service organizations for small and medium-sized enterprises should be speeded up. Except for major state projects and projects governed by special regulations, if enterprises, using either their own funds or bank loans, invest in such sectors as encouraged or permitted by the state, their project proposals and feasibility reports can be submitted simultaneously for approval in accordance with the prescribed procedure. In addition, the preliminary design and start of construction will no longer require government approval. Accordingly, the examination and approval process for projects with FDI should also be simplified. The process of changing functions of the government should be continued, and the government should be separated from enterprise management by reducing the number of matters requiring government examination and approval, simplifying procedures, strengthening the commitment to serving the public, eliminating administrative monopolies and breaking down regional barriers and regional protectionism. The government should strive to rule by law and protect the legitimate rights and interests of investors. Environmental protection needs to be enhanced and unnecessary duplication of similar projects should be curbed. Those factories, mines and enterprises should be closed that turn out low quality products, waste natural resources, pollute the environment or cannot meet safety requirements. 2. Implementing preferential tax policies. The corporate income tax of enterprises in government-encouraged sectors that are financed with either domestic or foreign investment in the Western Region should be collected at a reduced rate of 15% for a certain period of time. Upon approval by the provincial government, enterprises based in autonomous regions, prefectures or counties may also be granted reduction or exemption of corporate income tax for a certain period of time. New enterprises engaged in transport, power, water conservancy, postal service, broadcasting and etc. in the Western Region are eligible for a two-year tax holiday and a 50% reduction for the next three years following the tax holiday. No agriculture tax should be levied for ten years on income from special agricultural products produced by ecological forests and grassland converted from cultivated land for the purpose of ecological protection. By analogy with tax exemption in railway and commercial airport construction, no occupation tax will be collected for taking cultivated land to build state-level highways and province-level highways. Provincial governments in the Western Region should decide on any reduction or exemption of taxes for taking cultivated land to build other types of highways. If domestic or foreign investors invest in the Western Region in sectors where investment is encouraged by the government or sectors with a competitive edge and need to import advanced technology and equipment to facilitate their invested projects, these imports, except for those not exemptible by government regulations, should be exempted from tariffs and import value added tax, provided that the imports are purchased within the total amount of investment. 3. Implementing preferential policies for land and mineral resources. The government encourages afforesting activities and cultivating grass on barren mountain tops and infertile land and converting cultivated mountain slopes to forestry and grassland in the Western Region. The government allows those economic entities or individuals engaged in reafforestation and grass planting to own wood and grass in question and hold land use rights over such areas. Any economic entity or individual may apply to use state-owned barren mountains and land in accordance with laws, reafforestating these areas to protect the environment and improve the ecosystem. The only conditions are that sufficient amount of capital should be invested in the project and reafforestation should be successfully completed. As long as these conditions are met, any party may purchase the right to use state-owned land at a reduced rate. Such land use rights will remain in effect for 50 years and the concerned party can apply to have those rights renewed at the end of the 50 years. These rights can be inherited or transferred. In the event the state reclaims those land use rights for development purposes, the affected party will receive compensation in accordance with laws. No felling of trees is allowed in forested areas that have been converted from cultivated land under state grain subsidies. The overall amount of agricultural land should be carefully maintained and there should be a balance between the amount of agricultural land used for other purposes and the amount of reclaimed agricultural land. The system of examining and approving the use of land for development purposes should be improved by simplifying procedures so that land can be provided timely for development. The proceeds from the sale of land use rights for development in cities and towns should mainly be used for urban infrastructure development. Greater policy support will be provided for carrying out surveys and appraisals and for the prospecting, development, protection and rational utilization of mineral resources in the Western Region. Policy guidelines should be formulated to encourage the transfer or sale of prospecting or mining rights in accordance with laws in order to develop a market of mining rights. 4. Regulating through pricing and fee-charging policies. The price reform should be deepened to enhance the effect of market forces on prices. Prices involved in the West-East Gas Pipeline Project and West-East Power Transmission Project need to be reasonably set, creating a mechanism to regulate prices linking the production and marketing of natural gas, power, oil and coal. The pace of water tariff reform must be quickened to raise the price of water gradually to a reasonable level in line with the need of water conservation and to improve fee collection and management pertaining to water resources. Water resources in one river basin should be subject to overall management to ensure the strict implementation of planned water use and water rationing so that water resources can be rationally utilized. Specific fees should be charged in all cities for urban sewage treatment and garbage disposal and funds proceeding from this fee collection should not be used for any other purposes. Vigorous efforts should be made to prevent contamination and protect water resources on the upper reaches of rivers and river source areas. Airlines operating inter-provincial, provincial and regional feeders in the Western Region can set airfares independently. Special fares may be introduced on new railways built in the Western Region. Coverage for postal and telecommunication services in the Western Region should be expanded throughout the region. IV. Policies for opening up towards domestic and foreign investors 1. Enlarging the range of investment open to foreign investors. Foreign investors are encouraged to invest in infrastructure development and resource development in the Western Region, including projects in agriculture, water conservancy, ecological improvement, transport, energy, municipal services and utilities, environmental protection, mining and tourism, and in the establishment of research and technology development centers. A greater proportion of the service and trade sector in the Western Region will be opened to foreign investment. The pilot operations of foreign investment in banks, retail stores, and foreign trade enterprises will be extended to municipalities directly under the central government and the capital cities of provinces and autonomous regions. Foreign banks in the Western Region will be allowed to engage in RMB yuan transactions gradually, and telecommunications, insurance and tourism will be opened to foreign direct investment in accordance with relevant laws and regulations. Foreign investors are allowed to set up such Chinese-foreign joint ventures as accounting and law firms, engineering design companies, railway and highway cargo transport companies, and enterprises engaged in municipal public utilities and in other sectors designated to be opened to foreign investment. Priority is given to the Western Region in carrying out pilot operations in some of the sectors designated to open up to foreign investment. 2. Opening more channels for foreign capital utilization. Pilot BOT operations as well as TOT operations will be carried out in the Western Region. Foreign-funded projects are allowed to raise funds through corporate financing, including financing in RMB yuan. The government supports the listing of qualified foreign-funded enterprises based in the Western Region on domestic and foreign stock markets. Regarding enterprises in the Western Region engaged in sectors where foreign investment is encouraged or permitted by the state, the government supports them to attract foreign investment through transfer of operating rights, transfer of stock, and merger and acquisition. Vigorous attempts should be made to attract foreign investment through Chinese-foreign joint industrial funds or venture capital funds. Chinese-foreign joint ventures are encouraged to re-invest in the Western Region, and if the proportion of foreign capital in the project of re-investment exceeds 25%, the project will be entitled to the same preferential treatment enjoyed by those with FDI. With regard to foreign investment in the Western Region in infrastructure and sectors with a competitive edge, the allowed proportion of equity held by foreign investors can be appropriately raised, and the proportion of financing provided by domestic banks in RMB yuan for foreign-funded fixed asset investment can be appropriately increased. The proportion of concessional foreign loans in the total investment may be appropriately raised for some projects in the region. Regarding projects engaged in sectors with a competitive edge and projects that earn foreign exchange through exportation, the government supports the importation of advanced technology and equipment by awarding quotas for foreign concessional loans. Projects in the Western Region are given priority in the use of multilateral and bilateral grants. 3. Expanding foreign trade and economic cooperation. Enterprises based in the Western Region are granted more decision-making power in foreign trade and economic cooperation. The enterprises are encouraged to produce competitive products for exportation, contract foreign projects, export labor, and invest in manufacturing overseas, especially in neighboring countries, and restrictions on the entry and exit of personnel should be relaxed. Appropriate consideration should be given to the import of technology and equipment urgently needed for the economic development of the Western Region. When foreign tourists enter the country at major tourist cities in the Western Region, they will be granted visa upon arrival where conditions permit, and other visa policies that facilitate entry will also be implemented. More favorable border trade policies should be implemented, easing restrictions on export tax refund, expanding the scope of imports and exports, reducing quotas for commodity import and export, and relaxing the control of licenses and entry and exit of people. Efforts should be made to open up markets in the Western Region towards neighboring regions and countries and vice versa, and thus to promote the healthy development of regional economic and technological cooperation with surrounding countries. 4. Promoting regional cooperation and counterpart aid. Strong measures related to investment, finance, taxation, credit, trade, industry and commerce administration, labor and statistics should be adopted to support enterprises based in the eastern and central regions to invest in the Western Region through setting up factories, joint stock, merger and acquisition and technology transfer, while avoiding overlapping development, transfer of obsolete technology and environmental pollution. Under the guidance of central and local governments, all resources in the general community should be mobilized to conduct counterpart aid between the Western Region and eastern region. More assistance should be delivered to poverty-stricken areas and areas inhabited by ethnic minorities in the Western Region, and the campaign named "Develop the frontier and help frontiersmen prosper" should be continued. Regional economic cooperation in various forms should be conducted, with the focus on key development areas in the Western Region. V. Policies for attracting talents and developing science and education 1. Attracting talents and making good use of them. Specific policies should be formulated to attract and retain talents and encourage them to set up businesses in the Western Region. Along with the salary reform, hardship allowances should be provided to people working in harsh, remote or frontier areas. The salaries for personnel of government agencies and non-governmental institutions in the Western Region should be gradually raised to reach the national average level or even a higher level. In the implementation of key development tasks, major development projects and important studies in the Western Region, good working and living conditions should be provided to attract and retain talents from both home and aboard. The system of permanent residence registration will be revised to allow people to retain their original residence registration when they come to the Western Region to invest, trade or otherwise participate in Western Region Development. Any person who owns a permanent residence and has a stable job or other reliable sources of income in a city at or below the prefecture level in the Western Region may apply for a local urban residence permit if that person wishes. This policy is intended to stimulate an appropriate shift of the rural surplus labor force and a reasonable flow of population between regions. The exchange of government officials between the eastern and western regions should expanded. Relevant central government agencies as well as universities and research institutions in the eastern region should provide more information services and human resource support to the Western Region. Efforts should be made to bring in more foreign experts and technologies. With the assistance from the central government and coastal developed regions, more vigorous efforts should be made to nurture leaders and ethnic minority officials and train civil servants, professional and technical personnel, and business managers for the Western Region. 2. Taking advantage of the leading role of science and technology. More support will be given to the Western Region in the allocation of funds included in various science and technology plans, gradually increasing the overall amount of funding for science and technology. With the focus on the key tasks of Western Region Development, the scientific and technological capacity of the Western Region should be built and enhanced, and arrangements should be made to tackle key, general technical problems and to disseminate and industrialize major technological advances. The transfer of military technology to civilian use and production should be supported. Research institutions and institutions of higher learning in the region should be supported in their efforts to strengthen relevant applied research and basic research. The reform of the science and technology development system should be deepened, speeding up the transformation of applied research institutions into enterprises, consolidating cooperation between schools, enterprises and research institutes, and integrating scientific development and economic growth. A proportion of the sales income of enterprises in the Western Region may be used for technological development and the allowed amount may be raised as necessary. Innovation funds for small and medium-sized technology-oriented enterprises should intensify their support for qualified projects in the Western Region. The registration with local bureaus of industry and commerce should be simplified for scientists and technicians who wish to set up technology-oriented companies in the Western Region, and they are allowed to hold an increased proportion of shares, stock options or intellectual property equity. 3. Increasing investment in education. The compulsory education program should continue to be implemented throughout poverty-stricken areas in the Western Region, and the state will render more support for this program by increasing funding as part of a vigorous effort to make nine-year compulsory education available throughout the region. More support should be given to the development of institutions of higher learning in the Western Region, and universities and colleges based in the eastern and central regions should enroll more students from the Western Region. The counterpart aid program that matches eastern schools with schools based in poverty-stricken areas in the Western Region should be expanded along with the program that arranges for schools in large and medium-sized cities of the Western Region to assist schools in rural poverty-stricken areas. A system of distance education should be established in the Western Region. The training of rural grass-roots officials and farmers should be stepped up to improve their scientific and general knowledge. 4. Stepping up the development of culture and public health. The Western Region should be favored in receiving state subsidies for building local cultural facilities, broadcasting facilities and preserving cultural relics. Economic policies for state-run cultural and mass media entities should be further implemented to facilitate literary and artistic production. The "Connecting Every Village" project should be carried out to make radio and television broadcasting available to every village so as to further expand effective radio and television coverage in the Western Region. The culture of frontier areas and areas inhabited by ethnic minorities should be developed actively. Support should be provided for the development of culture and spiritual civilization in the Western Region. Stronger support should be given to the development of public health and family planning in the Western Region, with the focus on establishing and improving a primary health care system in rural areas. Following the principal polices and measures as described above, the Office of the Leading Group for Western Region Development of the State Council will be working with relevant government agencies to formulate detailed regulations and recommendations on policy implementation before the end of this year. Once these regulations and recommendations are approved and published by the State Council, governments at all levels in the Western Region should carry out these consolidated policies for Western Region Development. The above policies and measures are mainly applicable to the Western Region for the next ten years (2001-2010). These policies and measures will be revised as needed in the implementation of the Strategy for Western Region Development. The policy measures and detailed provisions described above take effect on January 1, 2001.

Measures for the Implementation of the Law on State Security (Partial CECC Translation and Chinese Text)

The following is a partial translation prepared by the Congressional-Executive Commission on China of the "Measures for the Implementation of the Law on State Security," issued by the State Council on May 10, 1994. The Chinese text was retrived from the National Bureau of Statistics of China's <a href="https://www.stats.gov.cn/tjgl/swdcglgg/xgfg/t20041118_402209113.htm">Web site</a> on February 21, 2006. Article 7: As used in Article 4 of the Law on State Secrets, "collude" to carry out actions which will jeopardize national security, refers to any actions of organizations or individuals within the borders of China: (i) plotting or carrying out together with foreign entities, organizations or individuals activities which jeopardize national security; (ii) accepting financing from foreign entities, organizations or individuals to facilitate or carry out activities which jeopardize national security; (iii) establishing affiliation with, obtaining aid from, assisting or carrying out with foreign entities, organizations or individuals activities which jeopardize national security. Article 8: The following actions shall constitute "other disruptive activities which jeopardize national security" under Article 4 of the Law on National Security: (i) organizing, plotting or implementing terrorist activities which jeopardize national security; (ii) fabricating or distorting facts, disseminating or spreading writing or speech or producing or transmitting audio/visual productions that jeopardize national security; (iii) taking advantage of established social groups or enterprise organizations to carry out activities which jeopardize national security; (iv) taking advantage of religions to carry out activities which jeopardize national security; (v) producing dissension among peoples or inciting division among peoples in a manner which jeopardizes national security; and (vi) any foreign individual who, in violation of relevant regulations, does not listen to dissuasion, and without authorization meets with personnel in China who has activities which jeopardize national security, or who are under significant suspicion of having activities which jeopardize national security.

Notice Regarding Strengthening the Administration Work of Provincial Level Television Satellite Program Channels (Partial CECC translation and Chinese Text)

The following is a partial translation prepared by the Congressional-Executive Committee on China of the "Notice Regarding Strengthening the Administration Work of Provincial Level Television Satellite Program Channels," issued by the Central Committee's Propaganda Department on January 30, 2000. The Chinese text was retrieved from the Hangzhou Provincial Government's <a href="https://www.hzrtg.com/20030120/1034991.shtml">Web site</a> on February 21, 2006.<br> 1. Satellite television channels shall strictly observe propaganda requirements, and firmly observe correct guidance of public opinion. With respect to reports on important events, breaking stories and other sensitive issues, they must obey the integrated dispositions of the local party committee Propaganda Departments, and strictly abide by Party discipline.

Provisional Rules on Punishments for Environmental Protection Law and Discipline Violations (Chinese Text)

National Development and Reform Commission Circular on the Issue of Implementing Preferential Admission for Religious Adherents to the Affiliated Tourist Sites of Places of Religious Activity (Chinese Text)

The following text was retrieved from the Zhejiang Province Bureau of Commodity Prices <a href="https://www.jgsc.gov.cn/2006-1/2006120101542.htm">Web site</a> on February 17, 2006.

Law on the Protection of Minors (Chinese Text)

The following text was retrieved from the Law-Lib.com <a href="https://www.edu.cn/20010907/3000620.shtml">Web site</a> on February 16, 2006.

Ideas on Improving the Development of Minority Cadres (Chinese Text)

The following text was retrieved from the Book Sir <a href="https://www.booksir.com/culture/minzu/MZ_INDEX/flfg_index/afl007.htm">Web site</a> on February 16, 2006.

Notice on the Proper Handling of Party Members Believing in Religion (Chinese Text)

The following text was retrieved from the Ningbo City's <a href="https://www.dfdj.gov.cn/info_show.asp?sysid=297&newstype_id=327">Web site</a> on February 14, 2006.

Excerpts from the Election Law Pertaining to Minority Nationalities (Chinese and English Text)

The following is a partial translation prepared by the Congressional-Executive Commission on China of the "Election Law of the National People's Congress and Local People's Congresses of the People's Republic of China," as amended by the National People's Congress on October 27, 2004. The Chinese text was retrieved from the Central People's Government's <a href="https://www.gov.cn/ziliao/flfg/2005-06/21/content_8303.htm">Web site</a> on February 14, 2006.<br> Excerpts from "The Election Law of the National People's Congress and Local People's Congresses of the People's Repulic of China" pertaining to minority nationalities.(revised October 27,2004) CHAPTER II NUMBER OF DEPUTIES TO THE LOCAL PEOPLE’S CONGRESSES AT VARIOUS LEVELS [Article 9, Clause 4, Paragraph 3] Autonomous regions and provinces with a large concentration of minorities may add an additional five percent to their total number of allocated deputies with the approval of the Standing Committee of the National People’s Congress. Counties, autonomous counties, villages, and minority villages which contain concentrated minority communities or have large numbers of minorities scattered throughout may, as determined by the Standing Committee of the People’s Congress at the province, autonomous region, or directly administered municipality level, increase their total number of delegates by five percent. CHAPTER III NUMBER OF DEPUTIES TO THE NATIONAL PEOPLE’S CONGRESS [Article 17] The number of deputies to the National People's Congress to be elected by minority nationalities shall be allocated by the Standing Committee of the National People's Congress, in light of the population and distribution of each minority nationality along with other factors, to the people's congresses of the various provinces, autonomous regions, and municipalities directly under the Central Government, which shall elect them accordingly. Nationalities with exceptionally small populations shall each have at least one deputy. CHAPTER IV ELECTIONS AMONG MINORITY NATIONALITIES [Article 18] In areas where minority nationalities live in concentrated communities, each minority nationality shall have its deputy or deputies sit in the local people's congress. Where the total population of a minority nationality in such an area exceeds 30 percent of the total local population, the number of people represented by each deputy of that minority nationality shall be equal to the number of people represented by each of the other deputies to the local people's congress. Where the total population of a minority nationality in such an area is less than 15 percent of the total local population, the number of people represented by each deputy of that minority nationality may be appropriately smaller, but shall not be less than half the number of people represented by each of the other deputies to the local people's congress. In autonomous counties where the population of the minority nationality practising regional autonomy is exceptionally small, the number of people represented by each deputy of this minority nationality may, upon a decision made by the standing committee of the people's congress of the province or autonomous region, be less than half the number of people represented by each of the other deputies. Other nationalities with exceptionally small populations shall each have at least one deputy. Where the total population of a minority nationality in such an area accounts for not less than 15 percent and not more than 30 percent of the total local population, the number of people represented by each deputy of that minority nationality may be appropriately smaller than the number of people represented by each of the other deputies to the local people's congress, but the number of deputies allocated to minority nationalities shall not exceed 30 percent of the total number of deputies. [Article 19] In autonomous regions, autonomous prefectures and autonomous counties, and in townships, nationality townships, and towns where a certain minority nationality lives in a concentrated community, the provisions of Article 16 of this Law shall apply to the election to the local people's congresses of deputies of other minority nationalitites and the Han nationality also living in concentrated communities in such areas. [Article 20] With respect to minority nationalities living in scattered groups, the number of people represented by each of their deputies to the local people's congresses may be less than the number of people represented by each of the other deputies to such congresses. In autonomous regions, autonomous prefectures and autonomous counties, and in townships, nationality townships, and towns where a certain minority nationality lives in a concentrated community, the provisions of the preceding paragraph shall apply to the election to the local people's congresses of deputies of other minority nationalities and the Han nationality living in scattered groups in such areas. [Article 21] In cities not divided into districts, municipal districits, counties, townships, nationality townships, and towns where various minority nationalities live in concentrated communities, the minority nationality electorates may vote separately or jointly in the election of deputies to the lcoal people's congress, depending on the relations between the nationalities and their residential situation in such areas. In autonomous counties and in townships, nationality townships, and towns where a certain minority nationality lives in a concentrated community, the provisions of the preceding paragraphs shall apply to the election to the respective people's congresses of deputies of other minroity nationalities and the Han nationality living in such areas. [Article 22] The electoral documents, roll of voters, voter registration cards, list of candidates for deputies, deputies' election certificates and election committee seals made or published by autonomous regions, autonomous prefectures and autonomous counties shall be in the written languages commonly used in the locality. [Article 23] Other matters concerning elections among minority nationalities shall be handled with reference to the provisions of the relevant articles of this Law.

Full Text: NPC Standing Committee decision on issues concerning methods for selecting HK Chief Executive and forming Legislative Council (English Text)

The following translation was retrieved from Xinhua's <a href="https://english.people.com.cn/200404/26/eng20040426_141562.shtml">Web site</a> on February 14, 2006.

Emergency Response Regulations for Major Epidemics of Animal Diseases (Chinese Text)

The following text was retrieved from the Central People's Government <a href="https://www.gov.cn/zwgk/2005-11/20/content_103923.htm">web site</a> on February 14, 2006.

Suspension of the Importation of Birds and Poultry Products from Countries with Avian Flu Outbreaks (Chinese Text)

The following text was retrieved from the Ministry of Commerce <a href="https://www.mofcom.gov.cn/aarticle/bb/200511/20051100699806.html">Web site</a> on February 14, 2006.

Law on the Prevention of Animal Epidemics (Chinese Text)

The following text was retrieved from the Law-Lib <a href="https://www.law-lib.com/law/law_view.asp?id=359">Web site</a> on February 14, 2006

Temporary Provisions on State-Run Institutions Making Public Calls for Recruitment of Personnel (Chinese Text)

The following text was retrieved from the People's Procuratorate Daily <a href="https://www.jcrb.com/zyw/n31/ca458558.htm">Web site</a> on February 13, 2006.