China makes multi-million dollar forestry investment

17/11/2008

China's State Forestry Administration (SFA) has announced a 3.65-billion-yuan (US $521.4 million) government investment in the country's forestry sector. The 3.65 billion yuan forestry investment is part of a combined investment of more than 200 billion yuan that the State Council has approved to help boost domestic demand for timber products and offset slowing exports through to 2010.

According to SFA deputy director Zhu Lieke, this investment will help create about 1.2 million jobs a year. Most of the money will be used to plant trees and improve living conditions of forestry workers, said Lieke, and with larger budgets local forestry services will be able to employ more people.

The SFA expects the money to encourage local governments and companies to make their own investments in forestry. Such additional financial input in the forestry sector could be as much as 10 billon yuan, according the estimates by the SFA.

By the end of 2006, over 1.47 million people were employed in China's forestry industry. The sector has suffered some damage since then, says the SFA, because of severe winter weather at the start of the year and the earthquake on May 12th.

The government has promised "protective prices" on the purchase of damaged bamboo and lumber and urged financial institutions to invest or at least write off bad loans where disasters are involved.