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China urges firms to invest in agriculture sector

BEIJING: China has urged enterprises to step up investment in agriculture to boost grain ouput and reduce the farm sector's heavy dependence on government credits.

The China Daily reported on Saturday Chinese firms would be encouraged to take on syndicated loans from foreign and domestic banks to build business portfolios in the neglected rural sector.

The firms would be given the incentives of favourable granting of land-use rights and export licences, and would have their interests protected by new regulations, it said.

Officials said investment in agricultural would give millions of rural households broader access to markets, manufacturing, processing, storage, transport, marketing and managerial expertise.

China hopes to diversify investment in agriculture, 90 percent of which is in the form of government loans and low-interest bank credits from administrative departments.

China has estimated that investment of 130-180 billion yuan is needed to raise annual grain output by 50 million tonnes by 2000, a key target of the 1996-2000 Five-Year Plan, the newspaper said.-Reuter