China's government warned yesterday that 2009 will be "possibly the toughest year" since the turn of the century in terms of securing economic development and consolidating the "sound development momentum" in agriculture and rural areas.

The slowdown in the world economy had exerted an increasingly negative impact on the Chinese economy, said the first document of the year issued by the State Council and the Central Committee of the Communist Party of China.

"The development of agriculture and rural areas in 2009 is of special significance," it said.

"The biggest potential for boosting domestic demand lies in rural areas; the foundation for securing steady and relative fast economic growth is based upon agriculture; the toughest work of securing and improving people's livelihoods stays with farmers."

In the document, the sixth of its kind to address rural problems, the government urges authorities to take resolute measures to avoid declining grain production and to ensure the steady expansion of agriculture and rural stability.

This year's budget for agriculture and rural development is to be disclosed at the annual national legislative meeting scheduled in March, but the document said more investment would come from fixed assets investment, treasury bond issues and revenue from higher land use taxes.

Last year, the budgeted investment in agriculture and rural development grew 37.9 percent year on year to 595.55 billion yuan (US$59.85 billion). As of 2009, capital-stretched county governments in central and western areas would no longer provide counterpart funds for public utility construction bankrolled by central finance involving ecology, reservoir renovation, potable water supply and irrigation.

Government-sponsored investment corporations and industrial development funds for agriculture could be established when conditions were mature, the document said.

Subsidies would be extended to cover not only all farmers who grow rice, wheat, corn and cotton this year, but also those who plant rape and soybeans. Purchases of energy-efficient machinery by farmers and stock breeders would also be subsidized.

The government is also to extend credit support to breeding farms with standardized sanitation facilities. Dairy cattle production bases would receive more fiscal input for the construction of standardized milk collection stations.

The government aims to roll out social security schemes for rural residents and strengthen the protection of farmers' land rights and rural workers' employment rights.

Millions of rural workers lost their jobs and returned home from coastal provinces, exacerbating the severe unemployment in rural areas. The National Bureau of Statistics estimates that about 5 percent of the 130 million migrant workers have returned to their homes since late 2008. Other officials put the figure higher.

The document urges local and central government departments to adopt measures to create jobs and increase rural incomes.

Companies are asked to take on more social responsibilities and give rural migrant workers more favorable employment treatment. Flexible employment policies and more training opportunities were also encouraged.

Meanwhile, local government departments should increase investment to provide favorable tax and fee policies to those who lost jobs in cities and expect to find new work in their hometowns.

The government also urged departments to map out basic pension insurance measures suitable for rural conditions and migrant workers.

More efforts would go to developing culture, education, health care, and other social welfare in rural areas, inhabited by 900 million people.

The government would raise teachers' salaries, and subsidize rural schools and students from poor families.

The government is also to extend its rural subsidy scheme for home appliance purchases nationwide.

It provides a 13 percent subsidy to rural buyers of home appliances such as TVs, refrigerators and washing machines. Yesterday, four more products were added: motorcycles, personal computers, water heaters and air conditioners.

(Xinhua News Agency February 2, 2009)