INTRODUCTION

12.1 Before 1949, China had fixed industrial assets of only about ten billion yuan. Since then, Chinese industry has developed rapidly. According to documentation on world industrial standards, China has now had a diversified industrial system, and has accumulated fixed assets worth over 1500 billion yuan. The value of industrial output has increased nearly one hundred fold. Industry has become the dominant force in the national economy and has provided the facilities and impetus for economic development in China.

12.2 Nevertheless, the overall level of industrial development in China is very low. The structure of industry is not completely rational, resource allocation is quite poor, and product quality still has much room for improvement. Even more important, the overall level of industrial technology in China is very low, resulting in the waste of resources, pollution of the environment and a weak capacity for sustainable development.

12.3 Since the late 1980s, China has been vigorously keeping up with new developments in high technology and the creation of a gifted team of scientific researchers has resulted in some breakthroughs. The establishment of high-tech development zones has given impetus to the growth of high-tech industrial sectors.

12.4 Since 1949, communications and telecommunications in China have made great progress. However, generally speaking, there are still problems of low technology and poor quality, so that they cannot meet the needs of economic development and have become a bottleneck to economic development.

12.5 During the 1990s, as well as at the beginning of 21st century, the Chinese Government will emphasize the development of key raw material industries and communications and telecommunications. It will also give overall consideration to human survival, to development, and to the environment and will carry out rational planning, distribution and construction.

12.6 The general objectives for sustainable development of industry are to reform the industrial management system, in keeping with the requirements of social and economic sustainable development strategies, to adjust and optimize the structure of industry and distribution, to update traditional industries with the most advanced electronic technologies and automation systems in order to modernize production technologies and equipment in traditional sectors of industry, to underscore the importance of high-tech development in the industrial sector, to promote the development of cleaner production, and to improve product quality to further the development of industry, transportation and communications in the direction of sustainable development.

12.7 This chapter includes five program areas:

PROGRAM AREAS

A. Improving the Industrial Structure and Distribution

Basis for action

12.8 In 1992, the Chinese Government adjusted the strategic goal for economic development for the 1990s in accord with the evolution of the situation at home and abroad, and indicated that the structure and regional distribution of industry should be rationalized, by improving the quality of production, optimizing the industrial structure and increasing returns on investment.

12.9 China will have set up a new socialist market system by the end of this century. Resources will be distributed according to the market requirements and economic activities will abide by the law of value and adapt to variations in supply and demand. Market mechanisms will optimize the allocation of resources, assist in adjusting the structure of industry and provide a basis for improving conditions for the sustainable development of industry.

12.10 In the existing industrial structure, a weak foundation in basic industries and an irrational structure in the processing industry are limiting factors to the stable development of the economy. The central problem is that developments within the energy sector, transportation and the key raw material industries cannot meet the requirements of rapid economic development. Long-term power shortages restrict industrial production to less than full capacity, which has resulted in idle capacity. Entering the 1990s, phenomena such as dissipating investments, lack of economies of scale, and poor industrial competitiveness in key industries such as the machinery, electronic and petrochemical industries, in automobile manufacturing and construction have all been factors weakening industrial development. The manufacturing of machinery, which is a major component of national economic, scientific and technological development, is faced with the significant problems of old facilities, low quality of products and outmoded technological processes.

12.11 The development of high technologies and the high-tech sectors will be a major force in strengthening aggregate national strength. China will focus on the development of high technology and related industrial sectors, which will help bolster the revamping of traditional industries, and will increase the proportion of the high-tech sector in the overall industrial structure.

12.12 At present, the problems of an irrational distribution of industrial production and regional economies and the serious problems of duplicated construction, duplicate production and duplicate introduction of products result in a low centralization of production and unsound economies of scale. These are inappropriate for the specialization and coordination required by modernized production.

12.13 Although rural industries have become an important channel for the prosperity of the rural economies, Their rapid development has resulted in a waste of resources and serious pollution due to a lack of foresight, low technological levels, primitive facilities, small scales of production and inadequate funding.

Objectives

12.14 The state should take macro-economic steps to support basic industries and to deal with problems of backwardness. It is necessary to start by increasing the supply of resources and encouraging their conservation, in order to boost the capacities of energy supplies, major raw materials, transport and telecommunications, which are fundamental to the national economy.

12.15 Resource industries should stress the development of new products, as well as improving product quality. The product mix should be adjusted so that, by the year 2000, the range and quality of domestic products will reach levels comparable to those of the developed countries in the early 1980s, and thereby meet the requirements for the development of various branches of national economy.

12.16 Implement technological renovations in the manufacturing industry. Adjust the structure of products, industrial organization, and the professions. Through coordinated restructuring and revamping, improve the quality of the entire manufacturing industry. By the end of this century, 40% of the products in the machinery and light industries will be of a standard comparable with advanced world levels.

12.17 Promote the development of the machinery, electronic and petrochemical industries, automobile manufacturing, and the construction industry. Realize economies of scale. Strengthen the capacity for the development of new high technologies. Increase their compatibility and adaptability in domestic and international markets to lead to the development of inter-related industries. Promote upgrading of the industrial structure to make high-tech industries key to economic development.

12.18 Emphasis should be placed on the development of high technologies, such as electronics, computers and software, telecommunications, bio-technologies, automation, new energy, aviation and aerospace and new materials, in order to develop a series of high-tech sectors and make use of high-tech achievements.

12.19 Take advantage of different regions. Accelerate the coordinated development of industries by region. Promote a rational distribution of industry throughout the country. Strengthen the planning of rural industrial development. Improve technological levels and scales of production in rural industry.

Activities

12.20 In the 1990s, solve problems of power shortages by adopting conservation measures and boosting production. Accordingly, it is necessary to formulate a new energy conservation policy, and have preferential loans provided by the state. In the two fields of energy production and energy utilization, establish model conservation projects, encourage the use of advanced conservation technologies and increase energy efficiency. See Chapter 13, "Sustainable Energy Production and Consumption" for details.

12.21 Major resource industries should emphasize the utilization of advanced technologies and energy and resource savings. The iron and steel industry and industries which support agriculture should have rates of energy and resource consumption per unit output approaching that of advanced countries in the 1980s:

(a) Iron and steel industry. Through technological renovation and the expansion of existing enterprises, improve technical facilities. Boost the output of products which are in short supply, improve product quality, and reduce the consumption of energy and raw materials. Construct one or two large-scale steel complexes in coastal areas, to introduce the latest advanced production technologies and to stimulate the technological renovation of steel-making;

(b) Non-ferrous metallurgy. Emphasis should be placed on the integrated utilization of resources and development of advanced technologies. It is necessary to solve problems related to the mining and smelting of ores, to increase the capacity for integrated production, to speed up the development of new materials from non-ferrous metals in order to meet the demand for products which are in short supply and improve product quality;

(c) Petrochemical and chemical industry. First priority should be given to the development of advanced large-scale production technologies. The emphasis should be on the assimilation of imported technologies and the domestic manufacture of equipment for the large-scale production of petrochemicals, fertilizers and synthetic materials. The pace of innovation and research in the area of agro-chemicals and dyestuffs should be accelerated;

(d) Building materials. Through technological renovation, develop technologies for energy conservation and utilization of heat wasted in buildings, adjust the product structure of building materials. Develop the manufacture of high quality cement, plate glass and building materials. Expand the production of non-metallic mineral products and inorganic non-metallic materials, such as reinforced fiber-glass and glass fiber for pool furnaces. Develop methods for the comprehensive utilization of solid wastes. Set up projects to demonstrate the use of energy- saving building materials.

12.22 Enhance the planning of new and high-tech industries and combine the development of high-tech sectors with the technical renovation of traditional branches of industry. Formulate laws and regulations to accelerate the elimination of all primitive production methods which have obsolete technologies and a high consumption of energy and raw materials, which pollute heavily or which make poor quality products.

12.23 Through the formulation and publication of specialized development plans, the government will articulate development goals, general plans for the distribution of industry, scales of operations, technologies, and safety and environmental standards for the machinery, electronic and petrochemical industries and for automobile manufacturing.

12.24 Formulate standards for economies of scale in major industrial sectors and for major industrial products. Publish these as government industrial policies or regulations, which can then be used by banks or related economic departments to evaluate new building projects. In accordance with developments in world industrial technologies, regulate, adjust and amend standards and policies for new technologies. Provide information on new technologies. Encourage enterprises to adopt new technologies.

12.25 Formulate industrial and tax policies, which promote the development of key industries, encourage competition and economies of scale, and which reduce costs, lessen pollution and increase market coverage. At the same time, formulate laws and regulations governing normal competition.

12.26 Establish new and high technology development zones, which will become the bases for high-tech industries, in order to effect the commercialization and internationalization of high-tech achievements. Establish dozens of large modernized enterprises or enterprise groups with output values exceeding hundreds of million yuan.

12.27 Formulate regional economic development plans and policies for the regional distribution of industries. Through the tax and pricing system reforms and through the introduction of the joint-stock system, encourage local governments to adjust industrial distribution and the present industrial structure according to the principles of the market economy and comparative benefits. Promote economic union and specialized cooperation across regions. Destroy regional blockades and market separations to form a reciprocal industrial structure, with areas along coasts, railways, highways, trunk lines or major cities at borders providing the support necessary to encourage the development of large economic areas, in accordance with the strategy of opening to the outside world. Encourage the organization of areas for manufacturing industries, especially in coastal economic development areas, to take advantage of a concentration of intellectual resources and high technological levels in order to develop technology-intensive industries and service sectors, with high valued-added, high technological content and low consumption of energy and raw materials.

12.28 Rationally plan for the distribution of rural industries. Concentrate the development of rural industry to facilitate the adoption of technologies and projects originating in large or medium-sized cities. Encourage mutual aid and cooperation amongst specializations in cities and rural areas. Direct the development of main branches of rural industries, including the construction, building materials, processing of agricultural sideline products, textile and garment manufacture, light and fodder industries, towards forming conglomerates and towards specialization and modernization. Regulations concerning the elimination of obsolete facilities are also applicable to rural industries so that technological levels in rural industries can be raised and the waste of resources and pollution of environment can be reduced.

B. Developing Cleaner Production and Green Products

Basis for action

12.29 Pollution generated by industry and transport accounts for over 70% of total pollution in the country. As well, industry is a major consumer of energy and raw materials. Therefore, keys in the strategy for sustainable development are to minimize waste emissions in the production processes of industry and in transportation, and to increase the efficiency of energy and resource utilization per unit output value.

12.30 China is a developing country and has limited economic strength. Although China has accomplished a great deal in mediating the development of the economy with environmental considerations, because previous environmental protection has primarily emphasized the control and minimization of end-pipe discharges and due to a shortage of funds, much work remains to be done in order to ensure cleaner production, the production of green products and pollution controls throughout the whole production process. These factors have influenced the construction of capacity for sustainable development in industry.

12.31 Cleaner production refers to the practical means and measures that can be taken to satisfy the needs of people, but also to make reasonable use of energy and resources, while protecting the environment. It is based on planning and management of human activities so there is less consumption of raw materials and energy. Moves in the direction of minimization, reclamation and detoxification of wastes, or diminishing wastes during the production process, and the production of green products that will not harm people or the environment, will become dominant as the deepening of sustainable development proceeds.

12.32 Evidence has shown that environmental problems are not solely generated at the final production stage. Possibilities exist at every juncture of the production process, so controlling end-pipe pollution is far from solving the problems associated with environmental protection in China. Only by developing cleaner production, producing green products and carrying out pollution control throughout the product life cycle, can China establish a resource-efficient economy, which promotes energy and water conservation and reduces materials and land use, which promotes the evolution of conventional production strategies, which accelerates changes in development modes in industry, transportation and telecommunications, and which realizes maximum economic benefits with minimum energy and resource consumption.

Objectives

12.33 Plan and organize on a scientific basis the production process in various sectors. Optimize production links. Change from end-pipe pollution control to overall process control. Cross use renewable resources and energy. Reduce waste discharges per unit economic output. Reach the goal of increasing the utilization efficiency of energy and resources, and the prevention of environmental pollution.

Activities

12.34 Promote cleaner production. Promote public education about the significance of sustainable development. Change conventional ideas concerning the adequacy of end-pipe pollution controls. At the same time, promote international exchanges and cooperation. Organize people to learn about successful experiences in advanced countries for developing cleaner production and producing green products.

12.35 Formulate standards and principles for cleaner production suitable to the present level of economic development in China. Formulate a complete set of laws and regulations to assure the realization of the above standards.

12.36 Launch research and development work on technologies and equipment for cleaner production. Enhance the cooperation between production staff and researchers in environmental protection, metallurgy, the chemical and light industries, and agriculture in order to maximize the benefits of cleaner production techniques and to apply and popularize these techniques in production practices.

12.37 Study and develop harmless, low-polluting, low material-consuming cleaner production processes and products. Encourage the use of energy and resources for cleaner production. Increase efficiency in the utilization of energy and resources and especially encourage the use of renewable energy and resources:

(a) Reform raw material routing. Select clean, purer raw materials and low-polluting materials, such as high-grade iron ore and washed refined coal;

(b) Maximize use of non-polluting or low-polluting primary or secondary energies such as solar energy or electrical power;

(c) Set up a closed production loop. Use secondary materials and energy completely. At the same time, improve product containerization, strengthen the recycling of wastes and reduce the production of wastes;

(d) Reduce or control the use of backward vehicles. Research and develop vehicles having low consumption of energy and utilizing clean energy.

12.38 Renew or substitute for products that are harmful to environment. Enthusiastically develop the production of green products. Improve the production and utilization of products having environmental protection marks:

(a) Formulate standards for products that will be given the environmental protection mark and develop methods for monitoring quality;

(b) The government will give awards and preferential treatment to the production, circulation and export of green products or products with environmental protection marks;

(c) Strengthen public information and education. Encourage people to buy and use green products, particularly the products with environmental protection marks.

C. Development and Application of Industrial Technology

Basis for action

12.39 The technological level of industry, transport and telecommunications is a major indicator for evaluating a country's capacity for sustainable development. A higher level of technology will require lower consumption of energy and raw materials to achieve the same level of output, and will result in a relatively lower degree of negative impacts on resources and the environment.

L12.40 Most of the technologies in China's industrial, transport and telecommunications sectors are still at the level of 1960s or 1970s, so that the amount of resources consumed in production is very large. Statistics indicate that at present, the utilization rate of energy is only 30%, compared with 50% in advanced countries. The utilization of raw materials in the above-mentioned sectors is also low, far below the average level of advanced countries. Because of this, there is great potential for increasing the utilization rate of resources per unit output through increasing the technological levels and improving equipment.

12.41 The primary goal for the development and utilization of industrial technology is to develop and apply technology that is not harmful to the environment. This technology, in comparison with what is to be replaced, will be low polluting, use resources in a sustainable way, involve more recycling of wastes and products, and have acceptable ways of disposing of wastes.

Objectives

12.42 By the end of the year 2000, by emphasizing important technical facilities for agriculture, and the production of energy and raw materials, achieve commercial production of complete sets of equipment for large hydropower and power plants, for transmission and transformation of electricity, for transport, and for metallurgy, mining and chemical plants, so that overall technical levels will reach 1980s levels of developed countries.

Activities

12.43 Determine which major sciences will facilitate incorporating sustainable development of industry into the scientific plans of the central and local governments, and organize scientific study centered on improving product quality, developing green products, increasing labor efficiency, improving labor conditions and protecting the environment.

12.44 Research and develop basic machinery and associated basic parts. Develop technology which will integrate electronics, advanced design and manufacturing techniques into machinery. Research and develop new and high technologies such as micro-electronics, power electronics and information channels.

12.45 Improve capacities for productions of scale and improve technical levels in the energy, transportation and raw material sectors.

12.46 By relying on advances in science and technology, develop pollution control technologies that may influence the global environment and develop optimal industrial pollution control technologies and equipment. Popularize their use throughout the country.

12.47 Formulate preferential policies for, and provide leadership and encouragement for the development of the environmental industry.

12.48 Strengthen international technological cooperation. Develop environmentally-sound technologies cooperatively with advanced countries. Seek assistance for technologies and finances from international organizations.

12.49 Improve the quality of personnel by holding training courses to increase their technological and management capabilities.

D. Improvement and Enhancement of Industrial Management

Basis for action

12.50 Effective management and monitoring are necessary for sustainable development. Management and monitoring here refer to improving public awareness of laws and the environment, to correcting unsound factors in the present management system and to adopting economic, legislative and administrative measures, to leading and controlling the units and individuals involved in various kinds of activities, to adjusting economic activities to meet the requirements of sustainable development and to paying attention to energy saving and environmental protection.

12.51 With the development of the economy and improvements in standards of living level since China's opening to the outside world, public awareness of laws and the environment has gradually increased. However, generally speaking, there is still a wide discrepancy between the requirements for sustainable development and the level of public education. Man-made destruction, such as the excess exploitation, utilization and denudation of forests, and serious waste problems still prevail, thereby threatening the sustainable development of society, the economy and the environment.

12.52 China has not yet established a set of regulations and effective management measures for promoting production of cleaner products and making use of cleaner technologies. Therefore, it is difficult for industry to show much enthusiasm for cleaner production and advanced cleaner technologies.

12.53 An incomplete market system and local protectionism hinder competition amongst enterprises and result in the maintenance of some low efficiency and harmful production patterns. As well, the operations of many enterprises, especially some middle- or large-scale enterprises have not undergone basic change, and since they are not responsible for their own operations, lack the capacity for developing and governing themselves. But the same time, because the necessary social protection system has not yet been built, it is not acceptable to completely eliminate enterprises which are of marginal value or which have become bankrupt through market competition.

12.54 Although China has formulated and produced legislation and regulations for environmental protection, due to a lack of proper implementation and monitoring and punishment of those who violate legislation, these laws and regulations for the protection of resources and environment have not been completely implemented.

Objectives

12.55 Expand the system for the management of the Chinese industrial environment. Formulate trade management policies. Improve operational mechanisms in enterprises. Develop united, open markets to create conditions for the sustainable development of industry, transportation and telecommunications.

Activities

12.56 Promote educational activities to encourage public awareness of laws and environmental issues in factories and enterprises. With the help of books, journals and movies, promote education for environmental protection and environmental laws amongst employees. Increase understanding of the laws and the environmental consciousness amongst leaders and employees in enterprises.

12.57 Formulate and implement laws and regulations, for example on fair competition and anti- monopolies, to protect the normal functioning of the market and to promote the formation of a unified market. At the same time, change the operational mechanisms of state-owned large- or middle-sized enterprises, to push the enterprises into the market, so that they may achieve the status of valid, legal corporations which are self-managing, self-balancing, self-developing and self-regulating.

12.58 Formulate and implement the Enterprises Bankruptcy Law. Reduce the number of enterprises of marginal value, or with high consumption of energy and resources and producing heavy pollution by eliminating them, stopping their operations, annexing, transforming them or by other means.

12.59 Improve and standardize existing environmental protection laws, regulations and rules. Implement the principle of "polluter pays". Increase fees. Encourage producers to prevent and control pollution.

12.60 Implement the system of "three simultaneous constructions" (viz., the environment should be considered simultaneously with design, construction and implementation in engineering projects) and of Environmental Impact Assessments in the planning of industrial projects. Terminate projects that do not comply with standard requirements.

12.61 Encourage the comprehensive utilization of energy and resources, by implementing the rule of "who invests, benefits". The benefits of projects whose funds are raised by the enterprise belong to that enterprise and cannot be appropriated by or distributed to other units. Encourage other units to use the production residues and forbid charging those who use them.

12.62 Strengthen and improve the monitoring and supervisory abilities of environmental protection departments. Improve the facilities for environmental monitoring and inspection. Improve technological levels and capabilities for environmental pollution monitoring, forecasting and prevention.

12.63 Learn from the experience and technology of the developed countries in environmental management. Increase the quality and capabilities of management through international cooperation and domestic training.

E. Promoting Sustainable Development of Transportation and Communications

Basis for action

12.64 Transportation and telecommunications are bottle necks for economic and social development in China, particularly as follows:

(a) There are too few railway lines and limited passing capacity. "Bottle-neck lines" are increasing and the passing capacity of some of the "bottle-neck lines" is less than 60% of what is needed;

(b) Low grade highways which are limited in number, in poor condition and with low carrying capacities combine with heavy utilization and result in serious traffic congestion. Vehicles cannot reach economical speeds for which they are designed, and urban traffic facilities are very backward;

(c) The turnover, storage, handling and shipment capacities of harbors are insufficient. The discrepancy between the supply of and demand for coastal harbor facilities is very wide and the potential for inland water transport has not been developed;

(d) Airports are few as are the number of cargo planes. Telecommunications and navigation equipment and navigation management facilities for civil aviation are outdated;

(e) The overall transportation network is incomplete. Its structure is flawed, with an unsuitable division of transportation means in which railways are burdened with a large amount of short distance transferal which would be more suitably carried by motorized vehicles;

(f) The overall capacity in telecommunications is inadequate, with an inadequate telecommunications network and low distribution density. The capacity for long distance calling is limited. Rural telecommunications facilities are backward, and 50% of the administrative villages do not have telephones. The rate of telephone coverage is only 10% of the world's average;

(g) There is a wide gap between the technological level of postal and telecommunication systems, in comparison with those of advanced countries in the world. The application of program- controlled exchanges, digital microwave telecommunications and optical fiber telecommunications has just begun, and depends primarily on imports.

12.65 The inadequate capacity for transportation and communications and the backwardness of technology results in blockages in the transport of passengers and cargo, and delays in the transfer of information. This has influenced both social and economic livelihoods, and has hindered sustainable development.

Objectives

12.66 Develop the transportation and telecommunications industries. Attempt to alleviate the intense difficulties existing in transport and telecommunications by the end of this century. In the first ten years of 21st century, the goal is to develop the transportation and telecommunications industries in order to satisfy the requirement for improving the economic and the living standards of people and for promoting the sustainable development of society and the national economy.

Activities

12.67 Through the making of government policy, recognition should be given to the need to have strategies adequately in advance for developing the telecommunications and transportation systems. Implement central government planning for the construction of a comprehensive transportation network, with local governments taking charge of and amassing the funds to accelerate the construction of the telecommunications and transportation systems.

12.68 Accelerate and deepen the updating of the telecommunications industry. Adjust pricing systems according to market economy principles and rely upon pricing mechanisms to promote the rational division and unified coordination of railways, highways, water transfer, and long and short-distance transport. Encourage consolidated investment, the purchase of stocks and the use of various kinds of economic approaches for investment. Construct railway, highway, harbor and airport communications facilities to implement the policies of "new road, new price" and "who invests, benefits."

12.69 In accord with China's current situation, emphasize the construction of railways and accelerate the construction of highways, water transfer and aviation. Widen pipe transfer channels. Optimize the structure of transportation. Establish and improve the overall transportation network involving railways, highways, marine and air transport. Improve the technological levels of transportation and communications.

12.70 Strengthen overall planning for the development of urban communications. Increase inputs from the government to upgrade urban communications facilities and to modernize urban communications. Construct road systems which are rationally distributed and which are suitable for urban economic and social development. Construct facilities for managing transportation and modernized communications.

12.71 Introduce advanced facilities and management technologies from abroad to increase the overall transportation capacities. Also introduce advanced technologies for constructing long and large tunnels, big-span bridges, as well as, construction technology for expressways and high-speed railways. Develop high-speed railways and double-decker trains. Increase the technology for heavy-duty cargo railway transport. Eliminate coal-fired locomotives by achieving the total dieselization and electrification of rail transport. Dredge inland waterways to promote river transport. Develop coastal marine transport and high-tonnage truck transport inland. Use computer technologies to bring about the rational organization of transport and communications.

12.72 Raise technological levels in the postal system and telecommunications. Complete the construction of a modernized digital telecommunications network, which incorporates digital passageways as well as other mechanisms, is secure and reliable and has many applications in business. Construct and perfect a digital long distance transfer network with optical fiber cable as its basis and satellite and microwave system as peripheral attachments. Put a long distance direct dialing system in place in counties and establish the business network to transfer all kinds of information.

12.73 Construct rapid and high-efficiency arterial postal networks, including use of aviation, railways, highways, and varied transportation patterns. Increase the overall capacity of postal procedures and delivery. Increase the level of mechanization and automation and improve the working environment.

12.74 Improve the design of pipeline transport and broaden the range of use of pipeline transport. Research coal pipeline transport technology and build experimental pipelines.

12.75 Combine planning and design for construction of telecommunications and transportation with planning for land utilization. Pay attention to conservation of land, while providing preferentially low cost land for communications and transport use.

12.76 Accelerate the harbor construction of handling systems, and expand holding capacities for bulk cargo such as coal, petroleum, other mining products and grains. Develop an ocean container traffic system that links main and branch lines, which are equipped with advanced loading and unloading facilities. Renovate old harbors to make use of their potentials and increase the handling capacities and efficiencies of harbors.

12.77 Maintain comprehensive use of water resources. Accelerate the development and construction of shipping systems and harbors, including for the Yangtze River, the Pearl River and the Grand Canal. Raise shipping standards and transport capacities. Expand the use of rivers for both shipping and power generation. Develop inland river transport.

12.78 In the 1990s, the central government will concentrate on the construction of main state highways, so that by the year 2000, 18,500 km of high-grade motorways will have been built. Local governments should construct local highways or county and village highways, based on the central government's overall plan. At the same time, present highways should be improved and their grades rose.

12.79 Accelerate the construction of airports, and facilities for managing fleets and flight navigation. Strengthen the training of pilots, improve the flight management system and perfect the air traffic control system.

12.80 Establish the necessary long-term funds for loans to provide preferential low-interest loans for the construction of telecommunications and transportation facilities. Establish a tax system beneficial to the development of transportation and telecommunications. Establish special funds for telecommunications and transportation. Continue to use loans from abroad to construct key projects and encourage foreign investors to participate and invest in the construction of transportation facilities.

12.81 Train transportation and telecommunications technical personnel and management staff.