2nd LD: China vows to revive machine manufacturing sector

The Chinese government has laid out plans for establishing a group of competitive machine manufacturing firms by 2010 in order to reinvigorate its machine industry.

According to a government document published on Wednesday, the companies will be capable of manufacturing major machine items with their own intellectual property rights, and meeting the country's needs in the energy, transportation, raw material and defense sectors.

The government proposes equipment manufacturing centers with "many features and well-known brand names", and building up or improving advanced state-level major engineering centers.

By 2010, China will set up a technological innovation system based around a group of enterprises, and gradually form an industry of major machinery, new and high-tech equipment, basic and general machinery, characterized by the rational distribution of specialization, mutual promotion and coordinated development.

In the document, the government lists 16 categories of key equipment and machinery as priorities to invigorate the manufacturing sector.

The categories include large machinery for clean and efficient power-generation, large and complete sets of petro-chemical equipment, major coal mining machinery, large shipping vessels, high-speed trains, large precision high-speed numerically-controlled machine tools, and key equipment for integrated circuitry.

The government would launch a package of support measures for the independent development of major equipment that would gradually make the country self-sufficient in machine design, manufacturing and operation.

China would strive to acquire core technology and system integration technology through coordinated research programs.

The government would improve its policies and regulations, including fiscal, scientific and industrial policies, to support research and development, while creating a better market environment for fair competition.

The Ministry of Finance and the National Development and Reform Commission will work out preferential import tariff policies for domestic machine manufacturers that need to import spare parts and raw materials to build the key products.

At the same time, the duty-free policy for the import of whole and complete machine packages will be abolished.

The government will encourage the purchase and use of China-made equipment in state key projects, saying that an insurance mechanism would be established to allow manufacturers, users and insurance companies to share the risks.

The document recommends accelerating the establishment of rules and regulations concerning the machine industry based on foreign experiences, so as to ensure its smooth development.

It says the government needs to create conditions for Chinese machine producers to compete internationally.

Source: Xinhua