A amendment of China's Accounting Law was adopted at the 12th meeting of the Standing Committee of the Ninth People's Congress on October 31, 1999, and will be put into force as of July 1, 2000.

The draft amendment is expected to strengthen the flow of foreign capital into the country. The law's authors believe the new amendment will enhance the benefit the country is expected to get as a result of joining the World Trade Organization (WTO). By improving the supervision of accounting activities, which is expected to improve the monitoring of economic operations, the new draft will boost the confidence of foreign investors within the Chinese market. During the year-long process of revising the accounting law, authorities were careful that the revision did not increase difficulties for foreign capital's entry to China after WTO accession. The amendment refers to accounting rules in 13 countries and will be useful in the transition to international practices.

Fraud and deception in accounting activities have captured headlines in the Chinese press in recent years, raising concerns among economists that a murky accounting sector could erode the country's hard-earned economic growth. Li Jinhua, auditor-general of the National Audit Office, said accounting fraud, coupled with insider trading and ill-intended market hype, has caused heavy losses, hurt the confidence of investors and hobbled healthy development of the stock market. Revision of the accounting law, which was promulgated in 1985, began in May 1998 at the request of the State Council. It paid off late last October, when the Standing Committee of the National People's Congress passed a final draft amendment. The gist of the revision involved restoring the independence of accounting activities and increasing the transparency of accounting information. This is expected to help block under-the-table operations and protect investors. A handful of clauses have been improved or added in the new version for that purpose.

Under the new law, a person in charge of a corporation is legally responsible for the truthfulness of accounting information, rather than ¡°the accountant monitoring economic operations on behalf of the State and owners of the corporation" as stipulated by the previous draft, making the person in charge unable to pass the buck. The more precise statement of responsibility is expected to strongly motivate enterprise leaders to work harder on internal management in pursuit of a good image. This clearly shows that reinforcement of accounting management is a priority in China's ongoing reform of State-owned enterprises.

The new law also personalizes activities of the accountant, who is now ¡°responsible for himself," rather than "acting on behalf of the State and the enterprise. The accounting law will serve as a constitution in the school of accounting regulations. Implementation of the new amendment would have much significance for China's stock markets because it would tighten supervision of accounting information released by listed companies.
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The Chinese Government is considering ending its ban on private foreign trading companies. The tested technique of using pilot businesses of this kind to pioneer the practice is being considered. The government would try to put it into practice early this year, said a trade official who asked not to be named. Voices favoring opening of the entire foreign trading sector have been building up in China in recent years and the government has already loosened its reins on the monopoly of State-owned foreign trading corporations.

In addition to giving large and medium-sized State-owned enterprises easy access to foreign trading rights, the government eased its controls affecting private manufacturing enterprises engaged in the direct import and export business in October, 1998. Enthusiasm for direct trading rights has been high in private manufacturing enterprises since they were given access. Statistics from the Ministry of Foreign Trade and Economic Cooperation (MOFTEC) indicate that by the end of last October, more than 380 private manufacturing enterprises and research institutes had been granted direct import and export rights.

The government has also organized seminars and training classes to stimulate the growth of this fledgling group of foreign traders. But complaints about the high threshold for entry are often heard. All private manufacturing companies applying for foreign trade rights must possess 8.5 million yuan ($1.02 million) both in registered capital and net assets. In addition, their annual sales volumes should exceed 50 million yuan ($6.02 million) before they can be considered eligible to submit an application. The minimum standards for private manufacturing enterprises and research institutes to obtain foreign trading rights may be reduced this year, said the trade official. A fixed threshold will be set for the establishment of private foreign trading companies, but it will not be as high as that required for private manufacturing enterprises. Other trade experts have suggested equal treatment for all State-owned, private and foreign-invested companies in the international trading arena.
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China announced on December 12, 1999, a 31-article regulation which adds detail to the 1994 Law on the Protection of Investment of Taiwan Compatriots. The rules, which became effective on the same day of its publication, are intended to encourage more investment in the mainland and protect the business interests of the Taiwan entrepreneurs.People from Taiwan can invest in the mainland by using convertible currencies, equipment, industrial property and non-patent technology. They also can help explore for natural resources, buy stocks and bonds, deal in real estate and develop leased land.

According to the regulation, Taiwan investors who want to set up enterprises in the mainland need to apply for permission from the Ministry of Foreign Trade and Economic Cooperation and other agencies authorized by the State Council and local governments. Applications will be processed within 45 days. Children of Taiwan investors can go to primary and high schools or universities in the mainland. Taiwan investors can apply for establishing their own schools, as long as they are subject to local educational administrations' rules. Business fees for Taiwan enterprises are identical to those of mainland enterprises. Mainland units or organizations should not increase fees or charge new ones. Mainland law protects the investments, possessions, property rights, profits and other legal incomes of Taiwanese business people.

It is a positive measure taken by the mainland to thaw the ice in the cross-Straits relationship after Taiwan ¡°president" Lee Tenghui's claims made a big stir last July. The ¡°go slow" investment policy towards the mainland forced by the Taiwan authority since 1996 has not worked effectively. Attracted by the great market potential and the affinity of culture and psychology, Taiwan investors keep pouring investment into the mainland. As of the end of last October, Taiwan firms had invested in approximately 43,000 mainland projects that had a total contractual value of $43.58 billion. Cross-Straits trade volume was $155.6 billion.
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A three-step program for the deregulation of China's gold market has been submitted to the central government. The plan, announced earlier last October, was developed and submitted by the State Council-affiliated National Economic Research Institute. Officials admit the reform of gold markets is a pressing task facing the central government. Tight controls on gold production and strict allocations by the central bank have provided little initiative for producers, manufacturers and brokers to be aggressive in gold markets. This has resulted in a heavy fiscal burden for the government. However, the long-term goal of deregulation is expected to be achieved in a step-by-step and systematic manner.

The three stages include establishing a gold exchange, opening the domestic market and enabling the domestic market to become part of the international market. The first stage, which may kick off this year, will take about two years. The exchange is expected to gradually replace a People's Bank of China monopoly over gold production, purchasing and allocations. Only a few big gold producers, purchasers and brokers are expected to be granted access to the exchange. They will be allowed to conduct spot transactions using only renminbi in the exchange. Futures trading will be forbidden. Producers can sell their gold to the central bank or sell through the exchange, but how much they can sell to the central bank and how much they can sell through the exchange will be decided by the central bank. The bank will gradually reduce the volume of its purchases directly from producers. Its purchase prices will be determined according to the international gold market. Strong fluctuations are to be avoided. At the same time, the bank will open gold sales totally. The sales quota set for manufacturers will be abolished.

To avoid price risks, a few domestic producers with exchange memberships will undertake futures transactions on the international market through qualified local commercial banks with the central bank's permission. Before the full convertibility of renminbi, the domestic and international markets should be separated. Gold exports will still be banned in principle, except some in the form of gold jewelry. Unfortunately, price gaps stemming from the separation of the two markets is likely to induce gold smuggling and hedging. To curtail smuggling, the central bank should play a fine-tuning role to create a basic equilibrium between the two prices, which can be fulfilled by setting up a stabilization fund.

Stepping into the second stage, the central bank is to cease purchasing gold directly from the producers. All gold produced would be traded on the exchange. Individuals will be allowed to hold, buy and sell gold products such as bullion for savings and investment. This move will raise the trade volume on the exchange considerably. The possibility of gold futures activities can be explored in light of actual circumstances.

In the third stage, the domestic market should become an active component of the international market. An important precondition for the reform in its final stage is the full convertibility of the renminbi. With the full convertibility of the renminbi, a ban on gold imports and exports will be lifted and the central bank will no longer intervene to balance domestic and international markets.

Insiders said the central government has been working to open the gold market. An obvious signal is that it is adjusting domestic gold prices in response to fluctuations on the international market. The central bank cut gold prices three times between May and July and increased it in October, 1999. Meanwhile, China's reliance on gold reserves has also decreased. The country possesses 397 tons of gold reserves, less than 3% of its total foreign exchange reserves at current prices.
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China's industrial growth in November, 1999 rose a robust 7.6% on an annualized basis. The industrial value-added output stood at 191.9 billion yuan ($23 billion), representing an upswing of 7.6% over the same period of 1998, as compared to the annualized 7% in last October, the National Bureau of Statistics (NBS) said recently. The accumulated figure of industrial value-added output for the January-November period registered 1,817.7 billion yuan ($219 billion), a rise of 9% year-on-year. Production of State, collectively owned and share-holding enterprises grew steadily but the growth was outpaced by overseas-funded businesses.

China's State-owned and State-controlled enterprises churned out added value worth 110.7 billion yuan ($13.3 billion) last November, 6.5% higher year-on-year. The output figure for collectively owned and joint-stock enterprises registered 33 billion yuan ($3,9 billion) and 28.7 billion yuan ($3.5 billion) respectively, rising 4.9% and 7.8% on an annualized basis. Industrial value-added output by foreign-invested enterprises and those invested from the Hong Kong and Macao witnessed an obvious acceleration, surging 14.6% year-on-year to 41 billion yuan ($4.9 billion) last November.

China's foreign trade volume last November surged by 32.4%, the largest monthly growth in 1999, to hit $36.4 billion. Both import and export showed strong growth momentum, with exports growing 28.8% to reach $19.5 billion and imports leaping 36.8%to 16.9 billion. China's exports have begun recovering since last July. Their vibrant performance in recent months has driven up the cumulative export growth rate for the first 11 months in 1999. Statistics showed that during the January-November period, China's export volume amounted to $174.7 billion, up 6.6% from the previous year, while the imports volume witness a soar by 20%.9% to reach $148.3 billion.

China has raised its tax rebate quota to accelerate the strength of exports. The tax administration has raised the quota by 6.6 billion yuan ($795 million) over the first proposed 57 billion yuan ($6.9 billion). The move is intended to further support exporters who are doing more business and meet the requirements of the export tax rebate work at present. Last June the tax administration raised the average tax rebate rate by nearly 3 percentage points. At present, signs show that exports are back on track.
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G: Materials

86. Long life expectancy rich oxygen coal powder injection iron blast;

87. High-efficient continuous casting system;

88. Technology and whole sets of equipment for producing extremely clean steel;

89. Rare earth materials and their applications;

90. The lining-up technology and the whole sets of equipment for producing compound metal materials;

91. New technology & key equipment for Bayer mine washing process for producing aluminum oxide.

92. New technology & whole sets of equipment for ore pulp electrolysis;

93. High-efficient & energy-saving mine-washing whole sets of equipment & new mine washing agents;

94. Technology and whole set of equipment for producing para ammonium tungstate from scheelite and deep processing of hard alloy;

95. Recovery of hydrogen from gas refineries;

96. Medium and large-scale devices for cracking and separating ethylene;

97. Asphalt for important highways;

98. Chemical products for oil fields;

99. Production technologies and equipment for engineering plastics and heightened performance of general plastics;

100. Technologies, key equipment and raw materials for producing meridian tires;

101. Comprehensive technologies for the renovation and expansion of the small and medium-sized production devices of nitrogenous fertilizers;

102. Comprehensive technologies for the renovation and expansion of the small and medium-sized production devices of phosphorous fertilizers;

103. Production technologies and whole sets of equipment for producing potash fertilizers;

104. High performance coating;

105. Continued production of substitutes for chloro-fluorohydrocarbon;

106. Production of non-metal mineral materials and whole sets of equipment for the production;

107. High performance air-proof materials and products;

108. High performance materials and products for braking;

109. Superfine powder materials;

110. Special enhancing materials and products;

111. Technology of directly extracting low grade copper and hard extracting copper oxide mines. (to be continued)
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The economy in Jiangsu Province has grown steadily and quickly in the first half of 1999. Jiangsu, with a population of 71 million and an area of 102,600 square kilometers, is making the most of its productive locale in the Yangtze River Delta. A chief economic indicator in one of China's most developed provinces, Jiangsu's GDP reached RMB335.8 billion ($48.5 billion), 10% increase over the same period of the previous year. Jiangsu is the birthplace of many of China's important national industries. For years the value of its industrial output has ranked first in the country. And to ensure steady growth, the province has taken measures to guide production and the marketing of local enterprises.

The added value of State-owned enterprises and non-public industrial enterprises with sales revenues of 5 million yuan ($602,400) came to 102 billion yuan ($12.3 billion), 11.7% more than that of the previous year. This growth was 2.3% above the national average. Jiangsu's export value topped $7.7 billion in the first half of 1999. This number is an increase of 12.6% over the same period of the previous year. The volume of foreign trade and foreign investment for the province has surpassed one-fourth of its GDP as well as its fixed assets. By the end of 1998, there were 20,500 foreign-funded enterprises in Jiangsu, and 15,000 of them are fully operational. Foreign investments have grown to $36 billion since the reform and opening up.

Jiangsu has become one of the country's most popular places for investors from home and abroad. Six sectors--petrochemicals, electronics, machinery, textiles, building materials and food processing -- are the province's pillar industries. To develop these industries, many large and modern enterprises have been put into operation. Township enterprises are expanding rapidly as well. Their output value is two thirds of the province's total. Tourism, information services, real estate and the general service sector are also doing well in Jiangsu. Economic reforms and State-sanctioned open-market policies are the driving forces behind economic development in Jiangsu.

Since the reforms and open market policies took effect in the late 70s, Jiangsu's economy developed rapidly and sustained itself. In the past two decades, the annual growth rate was 12.8%. The province has also made breakthroughs in infrastructure. A modern transportation network has gradually sprawled across the province. The Shanghai-Nanjing Expressway, as well as the Nanjing-

Lianyungang and Nanjing-Nantong grade A highways, currently open to traffic, have made economic and social development easier. Two other projects, the Nanjing Lukou International Airport and South Jiangsu section of the Beijing-Hangzhou Grand Canal, have been completed. A third transportation magnet, the Jiangyin Yangtze River Road Bridge, is now also open to traffic. Construction on two other key projects, the Nanjing Yangtze River No 2 Bridge and the North Jiangsu Expressway, has meanwhile been accelerated.
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The economy has been growing rapidly in Northwest China's Qinghai Province over the past 50 years. The province's gross domestic product (GDP) reached 22.04 billion yuan ($2.66 billion) in 1998, a 42-fold increase over that of 1949 in real terms. The per capita GDP rose 12-fold since then, to 4,372 yuan in 1998. Qinghai has become one of China's important energy and chemical industrial bases. The Qaidam oilfield is now the fourth-largest of its kind in China, and more than 20,000 tons of chemical products from Qlinghai are sold worldwide. The province had only two small power stations with a combined generating capacity of 1 million kilowatt hours in 1949. At present, more than 100 electric power stations in the province produce more than 7 billion kilowatt hours of electricity a year. In a bid to open wider to the outside world and bring its advantage in resources into full play, Qinghai Province announced recently the following key areas and key projects for soliciting overseas investment:

1. Development of the resources of hydroenergy, petroleum and natural gas: hydro power stations at Gongboxia, Laxiwa and Kangyang on the upper reaches of the Yellow River; pipe lines sending Qaidam natural gas to Xining and Lanzhou; natural gas thermal power plants and related chemical raw materials.

2. Development and deep processing of the resources of minerals: non-ferrous metals, salt chemicals and building materials as well as lithium, strontium, magnesium, copper, carnallite, lead, zinc, antimony, gold, electrolytic aluminum, marble and granite.

3. Industrialization of agriculture and animal husbandry: reclamation of waste land and waste mountains; transformation of low and middle yielding farmland; processing of vegetables (including edible wild herbs), fur, leather, beef, mutton, aquatic products, grain, oil, tomato, mineral water, wild plants and Chinese and Tibetan medical herbs; and production and export of special products and native produce.

4. Transport, telecom, urban utilities and tourist facilities: upgrading of Xining Airport and Xining's urban utilities, transport facilities, and development of tourist resorts, particularly those tourist resorts with characteristics of plateau.

5. Technically transform the existing State-owned enterprises through auction, transfer, contract and cooperative operation:mechanical-electronic industry and the light and textile industry.

6. Environment protection: control over the pollution at the sources of rivers, Qinghai Lake, Qaidam Basin and Xining City including development of environment-protecting technology with the manufacture of environment-protecting equipment.
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Gansu Province in northwestern part of China is an important transporting hub linking the inner part of China with the country's northwestern border. ¡°The Silk Road" there famous in Han Dynasty and Tang Dynasty has been an important business road in China. The province is implementing a seven-year plan to bring high technologies to agricultural production in the Hexi Corridor along the ancient Silk road. The l,200-kilometer-long Hexi Corridor has become a prosperous agricultural area. More than 100 large foreign enterprises are taking part in developing this area. The World Bank has also invested $300 million in constructing the Shule River Valley irrigation system, which will create an oasis of 53,000 hectares in the desert. With a great potential for agro production, Gansu has now more than 3.3 million ha of farming land, 80% of which are used to grow grain crops. The corridor to the west of the Yellow River has a booming production of wheat, cotton, sugar beet, and etc.

The corridor is a vital communications line as part of the new Eurasian landbridge, the strategic railway link with Europe, and is rich in water, minerals, tourism, animals, plants, and solar energy resources, allowing it the possibility of playing a major role in Northwest China's development. The province is also a relatively booming industrial base in northwestern part of the country having major industries of oil, chemicals, non-ferrous metallurgy, machinery, coal. building material, textile, food, leather and medicines. Economy of the province develops fairly fast in recently years. Investment to fixed assets in the first half of 1999 grew 50.5% and GDP grew 8%.

In a bid to boost its economic development, department concerned of Gansu Province recently proposed 17 key projects for investors in the fields of expressway construction, power. chemicals, machinery, metallurgy, travel and environmental protection. The following are 17 key projects proposed. (to be continued)
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Maoming City is located in the southwestern part of Guangdong Province facing the South Sea to its south and bordering Guangxi Region to its north. With a coast line of 220 km, the city has quite a few natural deep water harbors, such as the Maoming harbor and Bohe harbor. There are also many inland rivers flowing across the city and most part of the rivers are suitable for sailing. With abundant rains and a mild climate, Maoming is rich in natural resources.Its yields of peanuts, sugarcane, mulberry trees, red Jute and other industrial crops, and traditional Chinese medicines such as Hejuhong and radix notoginseng are well known to make Maoming an important production base of the above-mentioned produce. The city has nearly 100 kinds of verified mineral resources with reserves of 27 having been verified. In addition to oil shale, the storage of kaoline is as much as more than 300 million tons and it ranks top in terms of quality and reserve in the country. Its jade mine, known as jasper in the south, is among the three major jade mines in the country.

After years of construction, Maoming's economy has undergone rapid development. The city is concentrating its efforts on adjusting the product-mix of its industrial enterprises, encouraging and fostering economies of different ownership to have common development, and making the 20 key products and foreign currency earning products of 7 major industries, namely, chemicals, light textiles, building materials, ceramics, machinery, foodstuffs, and medicine as key for the technological renovation of local industries. For the time being the oil refining capacity of Maoming Petrochemical Plant has reached 13.5 million tons and the plant has thus become the first base with oil refining capacity of more than 10 million tons a year. The fast development of Maoming's petrochemical industry has formed a large frame of industrial production to the city as the most advantageous condition for the industrial development of the city.

Maoming boasts of all necessary solid infrastructure. A highway network that extends to all directions has been completed. At present, Maoming city has 123 km railway with the linking up of the Sanmao Railway, and Hemao Railway into the country's railway network. A total of 11 berths, including one with the largest crude oil loading and unloading system of 250,000 tons in China have been built and the annual handling capacity of the harbor is 17.32 million tons. It is among the largest ports in the country and one of the first class open ports of the country as well.

Maoming has become the largest base for petroleum processing, fruit production and vegetable to be transported to the north, and an important base for energy, raw materials, and heavy chemical industries. Maoming recently proposes a new group of prospective projects to solicit foreign investment.

1. Civil Airport of Maoming: construction of a 4C class civil airport and accompanying grade one highway. Form: joint equity or cooperative venture. Investment: RMB500 million.

2. Annual production of 600,000 high performance meridian tires: using advantageous local resources and introduced advanced technologies both from home and abroad in the Gaozhou Rubber Plant. Investment: RMB850 million.

3. Annual production of 150,000 tons of ABS resin: using the raw materials of the 300,000-ton-ethylene plant and introduced key equipment and advanced technologies. Form: a joint equity or cooperative venture. Investment: RMB2.1 billion.

4. Annual production of 10,000 tons of florid-free polyether and accompanying epoxy propane by introducing key technologies and equipment. Form:joint equity or cooperative venture.Investment:RMB125 million.

5. Annual production of 10,000 tons of polypropylene short fiber: using raw materials provided by Maoming ethylene plant and introduced technologies and equipment. Form: joint equity or cooperative venture financing. Investment: RMB105 million.

6. Annual output of 240,000 to 360,000 tons of superfine calcium carbonate by means of dry producing technologies introduced from Spain. Form: joint equity or cooperative venture. Investment: $28.62 million (for the first stage).
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The Chinese Government implemented a logging ban in its natural (non-cultured) forests in 1998. Many industry insiders predicted domestic timber production would be reduced by 12-15 million cubic meters or by one-fourth of the annual market supply. They also expected market demand in 1999 to continue to grow as the nation works to stimulate the economy by investing heavily in infrastructure. However, the domestic production of timber for commercial uses has only dropped by about 2 million cubic meters.

Although forests in the upper reaches of the Yangtze and Yellow rivers can no longer be logged, northeastern forests, which account for the biggest share of market supply, can still be logged. In addition, to avoid a timber shortage, the government has reduced tariffs on timber imports and has cut wood product tariffs to zero. It allowed many more firms to import timber than before the logging ban. Consequently, imports of timber soared and imported timber varieties also multiplied. Imports came mainly from Southeast Asia, Russia, Europe, Africa and the South Pacific. Timber imports had set a record in 1999 in terms of amounts, varieties and sources. The importer's euphoria, however, has evolved into sorrow. A deluge of timber imports has resulted in an oversupply on the Chinese market and lower prices. During the first six months in 1999, 5.5 million cubic meters of timber were imported, compared with 6 million cubic meters in 1998.

As stockpiles grow, timber buyers are getting picky and the prices of timber are sliding. On average, prices have fallen by 5% to 10%. Prices of precious timber varieties, which use and sales are limited, have plunged by 20%. Timber imports will mainly focus on precious varieties and those with large diameters. Domestic supply will be satisfied mainly by relying on cultured forests, by increasing timber-use efficiency and by developing wood supplements.

China's timber imports are not expected to increase much during year 2000, predicted sources from the State Forestry Bureau. The country's timber imports will stabilize at about 10 million cubic meters. Domestic supply is expected to be 60 million cubic meters in 2000, with demand at 70 million cubic meters. Therefore, the country's timber imports will stabilize at about 10 million cubic meters.
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In 1975, the State Council listed Suifenhe as an independent city in the State plans and under the direct jurisdiction of Heilongjiang Province. In 1988, the province commanded the city to be in a trial of enriching the border area through cross-border trade. In 1992, it was listed as one of the first border cities to open wider to the outside world. Located at the central area of the Northeast Asian Economic Ring, Suifenhe is currently the largest land trading port leading to the Sea of Japan. Bordering with the Russia's most prosperous far eastern coastal area on the east, the city is only 21 km away from the Russian port of Bogorodchany. There is also one railway and two highways linking Suifenhe with Russia. So the city works as a hub for Sino-foreign land-sea thorough transport and also an important window and bridge for Northeast China to coop with outside in terms of division of work and labor services.

The economy of Suifenhe has been developing in a fast and steady way. In 1998, the city's gross domestic product (GDP) reached RMB413 million, up 14.7% from 1997. Its total agricultural and industrial output value posted RMB186 million, up 22.1%. Suifenhe's cross-border trade accounts for about half of the total of the whole province in value terms. In 1998, the city's import and export value amounted to $620 million, up 14% to account for 49.3% of the total of the province;its volume of cross-border-trade was 1.67 million tons, up 13.9% to account for 70% of the total of the province; and its port visitors were in a number of 551,000, up 15%. The city's tourism and private economy have kept increasing constantly. In 1998, visitors to the city port reached 181,000, bringing RMB177 million of direct income to its tourist enterprises. The infrastructural facilities of the city have been gradually improved. Since the border area was opened to the outside world, especially in 1998, the city government made all efforts to collect RMB1.22 billion to speed up updating of the infrastructural facilities of the port and the urban public facilities of the city.

Characteristics of a market system port and a border city have taken shape. Remarkable results have been achieved in soliciting foreign investment. The year of 1998 was honored as an investment-soliciting year by Suifenhe city government. In the year, the city had RMB482.26 million of contracted foreign funds and actually used RMB251.22 million of foreign funds, up 194%. Meanwhile, it signed contracts on 82 foreign-funded projects, up 100% in number. The movement of soliciting foreign investment has promoted the industry restructuring and increased the total social income, thus injecting great power and vitality for the economic development of the city.
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ChinQa's civil aviation business is expected to grow 8% a year in the next decade. By the year 2010, civilian air transport will reach 24 billion ton kilometers, said recently Liu Jianfeng, director of the Civil Aviation Administration of China. This month, air transport volume will reach 14 billion ton kilometers, and in 2000, national airlines will carry 100 million passengers and 2 million tons of cargo. Aviation transport came to 9.3 billion ton kilometers in 1998, ranking 10th in the world. Passenger volume was 57.55 million, more than double the figure of 1992. China is also doing its utmost to build and upgrade 41 airports. The airports altogether will handle 95% of the country's air traffic. This move will cater to an increasing demand expected between 2005 and 2010.

The airports are in 40 different municipalities, provincial capitals, autonomous regional capitals and areas important to China's economy and tourism. Priority will go to upgrading Guangzhou's New Baiyun International Airport and the Shanghai Hongqiao International Airport. The Chinese civil aviation industry is growing faster than the world average. Since China began reform and opening up policies in the late 1970s, the country's civil aviation business has lifted off at 20.1% annually for 15 consecutive years. This rate is 3.6 times higher than the average figure of countries belonging to the International Aviation Organization.

Over the past five years, China has spent 40 billion yuan ($4.8 billion) on airports, air routes, support facilities and technical rehabilitation. The country also has set up the world's largest flight institute, Asia's largest computer booking network and Asia's largest hangar. China has already finished building and expanding 48 key airports, including those in Shenzhen, Guilin, Guiyang, Fuzhou and Nanjing. Air traffic control facilities will be gradually upgraded from procedure control to radar-based air traffic control systems to help improve safety and on-time performance. The country now has more than 1,000 planes and about 983 air routes. Its international air routes cover more than 64 cities in 34 countries and regions. In the next decade, it will upgrade its air fleet and purchase more planes, particularly cargo and regional aircraft.
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French PSA Peugeot Citroen will increase its investment in and commitment to China, as a key part of its global strategy, said recently Jean-Martin Folz, president of the French auto giant. PSA Peugeot Citroen is ready to increase investment in its joint venture with Chinese Dongfeng Motor Corp and two French banks. In re-energizing its venture in China, Peugeot Citroen expects to increase its market share and to be competitive. With Chinese Government approval, Citroen will increase the capitalization of the Dongfeng Citroen venture from 2.6 billion yuan ($313 million) to 6 billion yuan ($723 million) together with Dongfeng and the French banks, la Societe Generale and BNP. In the venture which has absorbed 3.6 billion yuan ($434 million) and 4.3 billion francs ($682 million) in investment, Citroen holds 25% of the capital, Dongfeng 70% and the two French banks,5%.
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Motorola (China) Electronics Co Ltd recently announced the establishment of the Motorola China Research and Development Institute in Beijing. The move is widely viewed as a bid to further tap the local market and expand technological cooperation with Chinese partners. C.D. Tam, president of Motorola Asia£­Pacific Region, said Motorola is firmly committed to a true technology partnership with China. To date, the company has set up 18 research and development centers on the Chinese mainland and in Hong Kong. These centers focus on advanced semiconductor materials, micro£­controllers, mobile phone chips and software development. Motorola has committed 1.3 billion yuan ($160 million) to these centers. The company plans to have 25 research and development centers with an investment of 1.8 billion yuan ($220 million) by 2001.
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Japanese electronics production giant Toshiba will invest $11 million to produce portable computers in the Jinqiao Processing and Export Zone. The Swedish auto producer Volvo, attracted by the prosperity of the Waigaoqiao Free Trade Zone, will spend more than $3 million to establish a production and distribution center for auto parts.
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Russia and China recently signed to develop three high-tech projects which involve production of man-made plasma, citric acid and compound ferment in Yantai, Shandong Province. Such materials are widely used in medicine, food and beverages. With $65 million in investments, the three projects will be developed by the China Yantai Green Leaf Pharmacy Group and the Science and Technology Consulting Co from Russia. The Sino-Russian scientific and technological cooperation model base in Yantai, established in December 1998, is the first Sino-Russian high-tech industry base in China which opens new doors for the two countries' technological cooperation. In the past five years, more than 1,000 Russian technology projects have been introduced to China. The trade volume between the two countries also reached $5.5 billion in 1998.
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