Published by: World Tibet Network News Monday, November 17, 1997

BEIJING, Nov 15 (AFP) - China has approved economic incentives for its restive ethnic minorities, the official China Daily said Saturday.

The policy includes extending low-interest loans, tax breaks and special subsidies to trade and manufacturing firms in ethnic minority areas over the next three years, the newspaper said.

Some 2,000 manufacturing firms in more than 400 ethnic counties will be covered by the preferential policy which aims to benefit some 160 million people living in the ethnic border regions.

Under the new policy, the Chinese central bank will allocate 100 million yuan (12 million dollars) in interest-discount loans to set up trade networks in ethnic areas and to innovate technology for the designated production plants, the paper said.

The Ministry of Finance will also issue detailed measures on tax breaks to be granted to the trade organization and manufacturing firms, it added.

"We want to explore a new way for the country to serve the production and lives of the people in the ethnic areas in a socialist market economy," said Wen Jing, vice-minister of the State Ethnic Affairs Commission.

China's ethnic areas are mostly located in remote border regions such as the troubled Tibet and Xinjiang.

Both regions and to some extent Inner Mongolia, suffer from endemic poverty, a lack of infrastructure and weak economies.

China had earmarked some 800 billion yuan (97.5 billion dollars) in infrastructure and resource development from 1996 to 2000 for its sensitive minority areas.

An ethnic commission list of minorities areas to be developed included "Guangxi Zhuang, Tibet, Xinjiang, Uygur, Inner Mongolia and Ningxia Hui autonomous regions."

Beijing has been battling a growing separatist campaign in Moslem-majority Xinjiang and Buddhist Tibet.