China will adopt more favorable policies and invest more heavily in the rural areas next year, according to a central work meeting on rural development which concluded in Beijing on Thursday.

Rural construction will claim a higher share in national debts and financial budgets in 2006, with more money to be spent on the improvement of living conditions in the countryside, the meeting has decided.

"This is the first time for the central authorities to invest so heavily in rural development," said Han Jun, an expert of rural research with the Development Research Center under the State Council, China's cabinet.

"It means the focus of infrastructure construction would shift from the urban areas to the rural areas," said Han.

China has greatly increased its spending on farmers, agriculture and the countryside in recent years. It was estimated that in 2005, the central finance allocated over 300 billion yuan (37.5 billion U.S. dollars) to support rural development, a 50 percent rise over the figure of 2002.

"The weak status of agriculture has not changed yet," conceded China's Minister of Agriculture Du Qinglin.

Government statistics show that rural residents, who account for some 60 percent of the nation's total population, only have access to 20 percent of the country's medical resources. Farmers are in the similar inferior position in education and social security.

"It is imperative to increase investment for the building of a new socialist countryside," said Zhang Hanya, a research fellow with the National Development and Reform Commission.

He said "money" is a word underlined at the latest meeting and this would help promote the implementation of related policies.

Yet, how to guarantee the best use of the investment remains a problem to be resolved, the expert warned. According to Han, only one fifth of the money the government previously allocated went to farmers, with the rest being used improperly.

Apart from direct financial support, China has announced the abolition of the 2,600-year-old agricultural tax as of Jan. 1, 2006, which totals 22 billion yuan (2.75 billion dollars) every year.

Follow-up measures would be taken to push forward reforms in the rural areas based on the tax reform, the central work meeting said.

Reform should go further in the rural financial system, said Tang Min, chief economist of Asian Development Bank in China.

Government statistics show that farmers save more but borrow less from financial institutions in the rural areas. It is hard for them to get loans due to out-of-date financial mechanisms.

"Only when farmers could borrow money, would the countryside be more productive," said Tang.

More policy support, financial invetsment

China will make favorable policies and invest more in the rural areas next year.The year of 2006 is the start of China's 11th Five-Year Program (2006-2010) and rural work is of great significance to the goal of building socialist new countryside,said the meeting.

Policies favorable to rural development would be made and sustained next year, according to the meeting.

The government would spend more on agricultural development and rural development in 2006, it said, adding that the increase of investment would be higher than that in the previous year.

Expenditures on the countryside construction would have a higher proportion in the government's national debts and financial budget, it said.

More money would be used to improve living conditions for people in the rural areas, according to the meeting.

Apart from that, efforts would be made to push forward modernization of agriculture, raise farmers' income and further reforms in the rural areas, it said.

Infrastructure construction would also be enhanced along with public affairs next year, said the meeting.

It also pointed out that root organizations of the Communist Party of China in the rural areas should play a leading role in promoting development there.

Besides, efforts should be made to solve problems that affect reform, development and stability in rural areas, the meeting said.

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A central work meeting on rural development, which concluded in Beijing on Thursday, has set the targets for building a new socialist countryside in China during the upcoming 11th Five-Year Development Program period (2006-2010). During the two-day conference, which was attended by Chinese Premier Wen Jiabao and Vice Premier Huang Ju, the participants reached a common ground on the development of agriculture and rural areas in the next five years, as well as on how to stabilize grain production and promote the sustained increase of farmers' income.

The conference stressed that the development of agriculture and rural areas is of great significance due to China's national conditions.

"Only when the problems relating to agriculture, rural areas and the farmers have been solved properly, can China's economy develop in the correct direction," said a document from the conference.

China's legislature approved a motion on abolishing regulations on agricultural tax Thursday, which means China's 2,600-year-old agricultural tax will no longer exist as of Jan. 1, 2006.

The move is widely acclaimed as another major step toward improving the economic conditions of Chinese farmers, a top priority of the Chinese government.

Contributors to rural development honored

China on Thursday honored individuals and institutions for their contribution to grain production, agricultural technology popularization and the fight against bird flu.

Vice Premier Hui Liangyu attended the awarding ceremony, extended congratulation to those honored, and encouraged them to exert more efforts to build new socialist countryside.

The move, sponsored by the Ministry of Agriculture, is expected to set inspiring examples for people engaged in rural development and ensure the sustained development in the countryside.