China releases plan to modernize, update industry

AP News
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Posted: Apr 26, 2011 4:56 PM
China releases plan to modernize, update industry

China has released an economic blueprint that spells out which industry segments it will encourage or discourage, in line with its push to weed out small-scale businesses and back large, efficient state-backed enterprises. It also highlights the country's emphasis on supporting high technology industries and downplaying resource extraction.

The list published Tuesday by the National Development and Reform Commission, the nation's top economic planning agency, updates a similar one released in 2005. It sets out 750 industry segments that will be encouraged, 426 that will be phased out, and 223 that will be restricted by criteria such as minimum size to encourage consolidation.

The 111-page document guides government agencies in enacting regulations and setting broad policy actions, many of which were already in place. However, how the regulations are enacted around each industry segment will be closely watched.

Overall, the document shows the world's second largest economy is seeking to modernize and leave behind antiquated, inefficient ways.

On coal, the nation's leading source of electricity, the commission said it would fast-track mines with a production capacity above 1.2 million tons per year, phase out mines with less than 300,000 tons per year of capacity, and prevent new development on a range of mines with capacities in between, depending on their location.

It also gave high priority to developing renewable energy sources using water, solar and wind, as well as nuclear energy. The commission favors plants with 600 megawatts of peak capacity and above.

In line with previously announced policies, the country put the mining of rare earths _ which are used in electronics and other high-tech products _ in the restricted category. China has about 30 percent of the world's rare-earth deposits and accounts for 97 percent of global production. It has raised taxes on the deposits and aims to reduce exports this year as it tries to develop its own producers of lightweight magnets and other high-tech goods that use the metals.

China is seeking to develop a genetically modified food chain, water-saving and soil-conserving agriculture and to do away with tourist activities that focus on collecting medicinal herbs and other forest products.

The country even outlines a forward-looking attitude toward the Internet, with the government encouraging the development of high-speed broadband networks, Internet Protocol services, e-commerce billing, digital mobile phone and satellite systems and anti-counterfeiting technology.

The list targets for restrictions laser discs known as VCDs, which are the lifeblood of the pirate video trade in the country, as well as black-and-white, cathode-ray-tube televisions.

Beijing also targets a range of products that appear to be pollution concerns, from "disposable foam plastic dinnerware" to "fuel bicycles," and older batteries that use mercury and lead acid. Instead it favors such things as lithium-ion batteries and biodegradable plastics.