The Chinese government plans to set up compensate schemes for cities that used to rely heavily on exploration and processing of natural resources, an executive meeting of the State Council said on Wednesday.

The plan is among a package of moves to be taken by the cabinet to achieve the sustainable development of such cities, which used to supply resources for the booming Chinese economy.

Statistics showed that by the end of 2006, there were 118 such resource-based cities across the country, with 63 mainly exploring coal like Datong in the coal-rich Shanxi Province, nine exploiting oil like Daqing in northeastern Heilongjiang Province, and 20 engaged in metallurgical engineering like Dongchuan in southern Yunnan Province.

These cities currently suffer from multiple problems like pollution and ecological damage as well as unemployment and poverty, said the meeting presided over by Premier Wen Jiabao.

The meeting said enterprises are to take responsibility for environmental protection.

It also called for a boost in the reform of resource prices, adding that environment-related expenses and investment in safety facilities should be included in the cost of resource products.

The meeting pointed out more advanced technologies were needed to overhaul the traditional industries.

It said the central government would allocate more funds out of the treasury bonds and the central budget to develop substitute industries to promote a shift away from dependence on resources.

The Chinese government also vowed to step up environmental supervision and make more efforts to improve the environment and preserve the areas.

Environmental assessments would be carried out before building new mines and production would be banned in such mines where exploration may lead to serious ecological damage along with huge economic losses, according to the meeting.

New exploration techniques and equipments and clean energy technologies would also be promoted.

The meeting said the government will also endeavor to promote vocational training and create more job opportunities in these areas, as massive layoffs occurred when some cities began to run out of resources, making it even more difficult for a new labor force to find jobs.

Editor: Donald