An economy that has remained relatively underdeveloped and inadequate inflows of foreign capital are hampering the development of western China, said a senior economic official on Thursday.

West China currently uses only three percent of the country's foreign capital, said Wang Jinxiang, deputy director of the Leading Group Office under the State Council for the Development of the Western Regions.

Western China needs to open up more to maintain fast and sustainable development, said Wang.

Statistics show foreign trade volume grew at an annual average of 21.3 percent in west China in the period from 2001 to 2005, 3.3 percentage points lower than the national figure.

Meanwhile, west China's contribution to the country's foreign trade declined from 3.63 percent in 2000 to 3.17 percent in 2005.

West China should open wider to the outside world by improving its investment environment and taking advantage of its abundant natural and labor resources and the 14 countries and regions that border it, according to China's 11th five-year plan for the development of the western regions.

Foreign companies entering west China will enjoy preferential policies and easy market access, said Wang, adding that the Chinese government encourages foreign companies to cooperate with domestic ones in investing in the chemical, mining, farm produce processing, manufacturing and tourist industries in western China.

Source: Xinhua