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People’s Government Notice on the Issuance of the Shandong Province Light Adjustment Revitalization Plan

Lu Zheng Fa [2009] No. 46

To all municipal people's governments, people's governments of counties (cities and districts), all departments, authorities, and agencies directly under the provincial government, large enterprises, and all colleges and universities:

The Shandong Province Light Industry Adjustment Revitalization Plan (hereinafter referred to as the Plan) is hereby issued to you; please implement it earnestly.

Light industry is a comprehensive industry involving clothing, food, shelter, transportation, and other consumption sectors, and it plays an irreplaceable role in satisfying domestic demand, stabilizing exports, stimulating employment, serving the three types of rural issues, and other areas. At present, the international financial crisis has impacted the real economy, which has posed a great threat to the development of our province's light industry. Thus the formulation and implementation of the Plan will be of great significance in optimizing the light industrial structure of our province, promoting stable and relatively rapid economic development in our province, and carrying out the national Light Industry Adjustment and Revitalization Plan.

All local authorities and departments shall be guided by Theory and the important thought of the Three Represents to thoroughly implement the scientific development concept and to integrate their thinking and actions with the strategic decisions made by the provincial Party Committee and the People's government; further strengthen their awareness of opportunities; be proactive, scientific, and pragmatic; and carry out work related to domestic demand expansion, structural regulation, innovation, coordination, services, etc. in accordance with the Plan, so as to fulfill our plan to boost the light industry of Shandong Province.

All local authorities and departments shall formulate detailed implementation plans in accordance with the objectives, tasks, policies, and measures laid out in the Plan, and earnestly organize the Plan's implementation. Relevant departments of the provincial government shall establish and improve supporting measures and policies as soon as possible according to the clear division of labor and work requirements found in the Plan, in order to facilitate its implementation.

The Plan also specifies a number of key supporting projects that are either under construction or proposed; to be issued by the Economic and Information Technology Committee separately, and please all local governments, authorities, and relevant enterprises give them equal attention.

Shandong Provincial People's Government April 20, 2009

Shandong Province Light Industry Adjustment Revitalization Plan (2009-2011)

Light industry is a comprehensive industry involving clothing, food, shelter, transportation, daily necessities, entertainment, and other consumption sectors. It has played an irreplaceable role in satisfying domestic demand, stabilizing exports, stimulating employment, serving the three types of rural issues, and other areas. At present, the international financial crisis has impacted the real economy, which has posed a great threat to the development of our province's light industry, but has also provided an opportunity for restructuring. According to the general requirements of the state regarding "maintaining economic growth, expanding domestic demand, and adjusting industrial structures," the Plan has been formulated based on the actual situation in Shandong to promote adjustment and revitalization of Shandong's light industry.

I. Current Status and Situation Faced

(I) Current status.

1. The overall size of the economy is gradually increasing. Since 2000, the annual growth rate of our province’s light industry has averaged more than 25 percent. By 2008, there were 12,829 standard-sized enterprises, which created a total industrial added value of 369.3 billion RMB, created a sales income of 1464.34 billion RMB, generated profits and taxes of 134.72 billion RMB and 85.1 billion RMB in tax payments, and the industry's overall size and benefit to the economy ranked second in the country. The production volume of paper and cardboard, freezer, household glass, vegetable oil, agricultural film, salt, starch, solar energy products, sugar, monosodium glutamate, beer, wine, vegetable oil, meat and poultry products, processed fruit and vegetable products, processed aquatic products, enamel products, handicrafts, and other products ranked first in the country.

2. The product structure is being improved constantly. A number of internationally and domestically famous enterprises and brands have emerged, such as Appliances, Tsingtao Brew Works, Changyu Wine, AUCMA Freezers, Jinluo Meat Products, paper producers like Chen Ming and Huatai, Tri-Circle Locks, Weida Machinery, Meide Pipe Fittings, Cherry Hardware, Taishan Sporting Goods, Yunlong Fabrics, Yida Home , Shanhua Carpet, etc. The 101 products that have been given the title of Top Brand, 67 that have been named as Well-known Trademarks, and 61 that have been granted a certificate for product exemption from quality surveillance inspection.

3. Exports are increasing greatly. Exports of leather goods, furniture, crafts, plastic, electrical appliances, hardware, and other such products have strong advantages and competitiveness in the global market. In 2008, the delivery value of these exports reached 199.7 billion RMB, ranking first out of the other sectors of Shandong Province and third among national counterparts.

4. Industrial clusters taking shape. A variety of industrial clusters have taken shape, such as and Lancun's shoemaking cluster, Zhanhu's tannery cluster, Ningjin's tables and chairs cluster, Zhoucun's Fengyang furniture cluster, Zichuan's Xihe mahogany furniture cluster, 's Zhuangzhai paulownia product cluster, Huimin's safety net cluster, Yangxin's tableware cluster, Leling's hardware cluster, Boxing's Xingfu kitchenware cluster, Wendeng's home textiles cluster, 's straw handicrafts cluster, Linshu's purple willow product cluster, and Wucheng's glass and steel cluster.

5. Contradictions and problems in light industry development in the entire province.

First, major problems restricted the sustainable development of the light industry. For example, the mode of development is overly extensive, and the product structure is so simple and uniform that it tended to cause homogeneous competition, redundant construction, inefficient expansion, and wasted resources.

Second, the ability for indigenous innovation is generally weak. Research, development, and design are uncreative and unoriginal, which has badly reduced overall product quality. The practice of retailing products manufactured by one company under the brand name of another is still ubiquitous in exported products due to lack of core competitiveness and independent intellectual property rights.

Third, there is great pressure from the requirements of energy conservation and emissions reduction. In some sectors, like papermaking, food products, leather goods, and plastics, per-unit output values for energy, water consumption, and pollutant emission that were much higher than allowed by internationally accredited standards.

(II) The situation with which we are confronted.

1. Since the last quarter of 2008, the effects of the international financial crisis on our province’s light industry have gradually deepened and become more severe. A sharp drop in global demand caused the rise of trade protectionism in Europe and some developed countries; as a result, due to a lack of preparation and the fluctuation of the RMB exchange rate, a majority of exporters were caught off guard when confronting trade barriers, which greatly affected their profits.

2. A sharp drop in foreign and domestic demand and exports led to overproduction, a serious backlog, and finally the reduction of overall industrial profit. Many small- and medium-sized enterprises, especially export-oriented enterprises, had to close or suspend their production. Local employment was faced with huge pressure in some areas.

3. The national policy calling for expanding domestic demand to protect people's livelihoods has provided the development of the light industry with a broader platform. Our province’s light industry is relatively mature in its diversity and adaptability, with some enterprises even competitive in the global market. Governments at all levels and all authorities and enterprises shall strengthen their confidence to turn crises into opportunities, adjust and optimize the current structure to change the model of development, and alleviate and overcome the contradictions and problems encountered in the course of development in order to ensure stabilized production and industrial revitalization.

II. Guiding Ideology, Principles, Tasks and Objectives

(I) Guiding ideology. In accordance with the general requirements of the Party Central Committee and the State Council regarding maintaining economic growth, expanding domestic demand, and adjusting industrial structure, we must strengthen our confidence to remain positive, scientific, and pragmatic. Take structural adjustment as the main objective and boosting economic returns as our main focus in terms of meeting domestic demand, stabilizing exports, and increasing employment as directed by the relevant policies; develop scientific and technological innovations and reforms to support the optimizing and upgrading of our traditional industries; and we must seek new, typical, and quality projects to change the light industry's economic development model and make it stronger.

(II) Principles.

1. Highlight market orientation and increase development strength. Adjust the current product structure, explore the potential for consumption, expand domestic and foreign markets, and optimize the exporting structure and market structure.

2. Highlight technological progress and speed up transformation and upgrading. Develop new technologies, new products, new techniques, new designs, new materials, and new equipment, eliminate outdated production capacity, and promote structural adjustment and industrial upgrading.

3. Highlight key enterprises and focus on brand cultivation. Support those major enterprises that have an influential role, a high degree of association, and high development potential, as well as backbone enterprises, in order to speed up their development and their formation of independent brands.

4. Highlight expansion of employment and strengthening people's livelihoods. Emphasis given to labor- and manual-skill-intensive enterprises in order to ensure steady development.

5. Highlight industrial clusters and the development of the private economy and small and medium-sized enterprises. Exert our comparative advantages in order to develop an economy with special characteristics and set up industrial clusters to enhance industrial concentration and the cluster effect.

6. Highlight energy conservation and emissions reduction and advocate development of a circular economy. Vigorously develop industrial energy conservation, advocate energy-saving technologies, and promote the reuse and recycling of resources in order to protect our environment and promote the development of a circular economy.

7. Highlight the opening to the outside world and improve international competitiveness. Encourage capable enterprises to carry out strategic cooperation with multi-national corporations, introducing globally advanced technologies, processes and equipment, in order to improve the overall industrial level.

(III) Tasks and objectives.

1. Increase total economic quantity in a steady way. By 2001, sales revenue should reach 2.3 trillion RMB with an average annual growth rate of more than 12 percent and the value of exports should reach 270 billion RMB with an average annual growth rate of more than six percent.

2. Increase our innovation ability. Set up five national-level enterprise technology centers, 30 provincial- level industrial technology centers, 10 industrial research and development platforms, and 50 independently-built brands that are well-known both at home and abroad.

3. Optimize and upgrade our industrial structure. Implement 1,058 key projects with an investment of 219.4 billion RMB, foster five enterprises with sales income of 10 billion RMB, and create 40 industrial clusters.

4. Advocate energy savings and emissions reductions. Meet the objective of reducing COD emissions in 2011 by 75,000 tons compared with 2008. Create healthy development through a circular economy in the fields of food products and paper-making and increase the use of recycled paper, household appliances, and plastic goods.

5. Eliminate outdated production capacity. Eliminate outdated pulp, leather, and alcohol capacity.

III. Development Priorities

(I) Household appliances. Emphasis on developing energy saving, environmentally-friendly, intelligent, networked, and multi-functional products. For example, energy-saving and environmentally-friendly technologies should be adopted in refrigerators, with a focus on energy-saving, environmentally friendly, multi-temperature type, and silent refrigerators. In washing machine development, the focus should be on intelligent, large capacity, water-saving, coin type industrial or commercial types. Regarding central air conditioning, the focus is on the development of embedded air conditioning units, multiple types of household central air conditioning, air cooled heat pump cold/hot water chillers, screw chillers, variable- temperature air conditioning units, and low-temperature air conditioning units. Regarding water heaters (powered by electricity, gas, solar energy), the focus is on the development of energy-saving, time-saving (or quick heat), and safe electric shock-proof type heaters for the bathroom and kitchen. Regarding small household appliances (daily-use appliances), the focus should be on development of soymilk machines, electric kettles, electric rice cookers, induction cookers, range hoods, stoves, electric fans, electric heaters, and other small household electrical appliances like water machines, water purifiers, direct drinking water machines, etc. Make full use of leading enterprises in a role of setting an example and driving the industry forward in order to build up appliance enterprise clusters in a rational and active way. Support given to Haier, Qingdao Aucma, Duoxing, Shandong Xiaoya, Shandong , Laizhou Hongtai, Shandong Run Tai, Zhongda, Zhaoyuan Kangtai, etc. to help them upgrade their technologies and complete mergers and reorganization, accumulate their strength, and finally form a household appliance industry cluster made across Qingdao, , , Zibo, Dezhou, and other areas. Build up strategic alliances in the home appliance industry and advocate a mega-merger in order to increase the comprehensive strength of our province's household appliance industry.

(II) Paper-making industry. Focus on the development of high-grade coated paper, coated cardboard, containerboard, high strength corrugated cardboard, high-grade newsprint, offset printing paper, office paper, food and medical paper and packaging, decorative paper, and medium- and high-grade sanitary paper. Develop specialty paper and industrial processing paper, decorative-coated paper, flexible composite packing paper, color inkjet printing paper, and new varieties of high-strength paper; the proportion of high- and medium-grade products should reach more than 80 percent. Make rational use of straw resources, and encourage the development of reed, arundo donax L., stalks, and other non- wood fibers according to local conditions to produce fast-growing wood pulp and chemical wood pulp to increase waste utilization. Cultivate 20 key enterprises like Chenming Paper, Huatai Group, Sun Paper Group, and Quanlin Paper Group, increasing their proportion to the total output of the province to 80 percent or more and forming a set of specialized top paper producers. Introduce advanced printing and paper processing equipment from developed countries such as and Italy to upgrade equipment for printing and paper processing. Focus on the development of commercial printing paper, environmentally-friendly paper tableware, stationery, and multi-functional corrugated boxes.

(III) Food industry. Combine green agriculture, efficient agriculture, and the livestock industry and make use of biotechnology, information technology, and other high technology to transform traditional industries and push the food industry in a direction of scale, quality, nutrition, and health. Support Shandong Jiufa, Linghua Monosodium Glutamate, Luhua, and Xinlong Edible Oil, and other such companies in upgrading their grain and oil processing technology to produce higher-quality and higher-grade "green food" and "organic food." Support Foreign Trade, Jinluo, Delicious, Longda Foodstuffs, and Yantai Xiwin Food in developing meat processing technology, producing quality-assured meat targeted at domestic urban and rural markets, and chicken piece products targeted at European and ' markets. Increase the variety of meat products and expand the number of internationally accredited foods. Support Zhucheng Foreign Trade, Xiwang Group, and other enterprises in developing deep processing of starch and related derivatives. Support Dezhou Baolingbao and Futaste in focusing on the development of functional sugar alcohol products to seize the majority share of the international market. Support Qingdao Xindayang, Yulu, Huiyuan, Zhonglu and other groups in upgrading their fruit and vegetable processing technologies to develop low-temperature dried vegetables, frozen vegetables, fresh vegetables, vegetable juice, fruit juice concentrates, and natural fruit juice and beverage processing. Support Qingdao Zhengjin, Xingang, Rongcheng Homey, Wendeng Qiandao, Fushi, and other such enterprises in developing seafood processing, focusing on research and development of quick-frozen instant seafood products, condiments, and deep processing of aquatic foods. Improve the technology for processing fish and algae, increase the variety of aquatic foods, and improve the comprehensive utilization rate of low-value fish, shellfish, and algae raw materials. In oil processing, the focus should be on peanut oil and soybean oil. Strive to improve the quality of edible oil, encourage the production of corn oil, sunflower seed oil, and other new varieties of oil, and increase the yield of refining oils and specialty oils. Regarding the canned food industry, develop new varieties of canned foods like vegetables, beef, and aquatic foods, set up a production base mainly for exports, support the production of local specialties like asparagus, mushrooms, peaches, pears, shellfish, and other such items. Vigorously develop wafer crackers, sandwich cookies, blister crackers, decorative cookies, egg cookies, fruit and vegetable biscuits, sugar-free low-calorie cookies for the elderly, and nutrition biscuits for children. Develop multiple types of candy and increase the variety, quality, and added value of candy in order to meet market demand. Regarding the dairy industry: strengthen the construction of the milk source base; improve the quality of domestic milk; comprehensively promote mechanized milking and scattered feeding milking models to increase milk volume; vigorously develop sterilized milk and fermented milk; actively develop "organic milk," "immunity boosting milk," and other nutritional dairy products and high value-added dairy products; and enhance the market competitiveness of and focus on the development of Qingdao Synutra, Jinan Jiabao, Wendeng Pengcheng, Jinyang Dairy, and other such enterprises. Regarding the wine industry: utilize backbone enterprises to build up vineyards as the sources of raw material; focus on technological innovation to develop high- and medium-grade wine; create specialized wine varieties, cultivate independent brands, expand the scale of the industry, increase variety, and improve market competitiveness; promote the industrialization of rural grape planting; and support these four enterprises: Changyu, Yantai Great Wall, Qingdao Huadong, and the Grand Dragon to accelerate the development of the Penglai industrial wine cluster. Regarding the beer industry, optimize the industrial structure, adjust the industrial layout, increase industrial concentration, transform from the original pursuit - which was merely the pursuit of scale - to the pursuit of quality and development through management. Build up an exquisite craft beer industrial chain to make the entire beer industry form a complete organic system from raw materials procurement to production, logistics and sales, and make full use of the industry's advantages. Support Tsingtao, Yinmai Brewery, Taishan, and other breweries. Through technical innovation, the focus in the liquor industry should be on reforming traditional brewing technology, adjusting product structure, and improving product quality and grade. Support Taishan Shengliyuan, Lanling, Jingzhi, Bandongjing, Gubeichun, Langyatai, and Family Liquor.

(IV) Ceramics industry. Take Huaguang Group, Silver Phoenix Group, Zibo GT Industrial Ceramics, Shandong Guiyuan, Taishan Ciye, Guohua Ceramics, and Huayang Ceramics as backbone enterprises to focus on the development of magnesium-strengthened porcelain, quartz-enriched porcelain, bone china, Huaqing porcelain, Luqing porcelain and make Zibo Ceramics the top national contemporary ceramics brand. Take Shandong Guiyuan, Shandong Gongtaoyuan, Huaguang Group, Zibo Broham Electric Ceramics, Zibo Chenhong Electrical Engineering, Weifang Huamei Fine Technical Ceramics, and Shandong Pearlshell Ceramics as backbone enterprises for developing high-grade ceramics. Expand the export of art ceramics, integrate ceramics resources, explore ceramics culture, and promote the growth of the art ceramics industry.

(V) Bicycle and electric moped industry. Take Incalcu, Aucma, Bivin, Lovol, Merida, Jinan Qingqi, and other such enterprises as the backbone for promoting product variety, improving product quality and grade, and increasing the number of colors and types in order to meet the needs of different consumers. At the same time, support the development of a number of backbone enterprises, making motors, batteries, chargers, controllers, frames, and specialty paints, and put these products into large-scale production. Cultivate a set of well-known brands and large vehicle assembly backbone enterprises to stimulate development of the whole industry. Strive to make five local electric moped producers enter the national top 10 list, outshining most market rivals. The proportion of lithium ion batteries and light alloy frames for electric bicycles is to be 15 percent or more, and lithium ion battery power is to reach 500,000 unit groups (calculated based on 10Ah/36V).

(VI) Regarding the shoe-making (leather) industry, accentuate regional advantages, highlight local characteristics, and establish a complete industrial chain. With the formation of a number of large production enterprises and groups, build a number of mature shoe leather, shoe machine, supporting enterprises, and leather products exhibitions and trade markets. Support Weihai Golden Monkey Shoes, Qingdao Fude, Wendeng Tannery, Zibo Dahuan Jiubaoen Tannery, Yantai Tannery, Yiyuan Tannery, Weihai Tannery, Double Star Group, Qingdao Hengda Group, Shandong Fuhao Feglar Leather Co., Ltd., and Yantai Wanhua Micro Fiber Co., Ltd. in order to enlarge their economic scales. Focus on the development of products with high technology content and high added value, as well as environmentally- friendly products, in addition to technologies that are efficient and high in quality and save energy and reduce emissions.

(VII) Plastics industry. Support Shandong Plastic Products Trial Plant Limited, Shandong Group, HuaSu Industry, and other enterprises in speeding up the development of agricultural plastic film in order to meet the needs of modern agricultural development. Support Shandong Taifeng Plastic Geotextile Materials Co. Ltd., Tai'an Modern Plastics Co. Ltd., and other such enterprises in speeding up the development of plastic geotextile materials to provide support for the construction and engineering industries. Support Zibo Huifeng Plastic Co. Ltd, Weifang Modern Plastic Co. Ltd., and other such enterprises in speeding up the development of plastic pipes and pipe fittings. Support Shandong Qiwangda Packing Products Co., Ltd., Changle Shengda Plastic Products Co., Ltd., and other such enterprises in speeding up the development of plastic packaging. Support Shandong Chunchao Master- batch Co. Ltd., Shandong Dawn Group, and other such enterprises in speeding up the development of functional and modified plastics in order to promote the research and production of engineering plastics, automotive plastics, home appliance plastics, communications plastics, industrial plastic parts, and plastic products for daily goods. Support the Plastic Association of Shandong Province in speeding up the implementation of sterilization, recycling, and reuse of medical plastic waste to reduce environmental pollution and make the waste profitable. Strengthen indigenous innovation, establish five key industrial technical centers, set up four industrial technology research and development platforms, and cultivate eight brands with independent intellectual property rights.

(VIII) Furniture industry. With Jinan, Zibo, Weifang, and Yantai as the center, focus on supporting the development of such furniture enterprises as Shandong Fengyang, Yantai Jisi, Shandong Jinri, Jinan Bailiya, Zhucheng New Huayu, Xinlang Ovemar, Zibo Fuwang, and Jinan New Lord. With Jinan, , Ningjin, Qingdao, , , , etc. as the center, support the development of solid wood furniture enterprises, such as Jinan Laishi, Western Cowboy, U+ Furniture, Futong, Ningjin Deke, Qingdao Yimu, Qingdao Beiyuan, Qingdao Liangmu, Qingdao Haiyan Wood Industry, Qingdao Yide, Rizhao Sanmu, Linyi Hengjiu, Dongying Shenghui, Guangtian Wood Company, and Yangxin Ouya Wood Company, and exporting furniture enterprises like Caoxian Caopu and Luyi. With Jinan, Qingdao, Dezhou, and Linyi as the center, support the development of panel-type furniture enterprises such as Jinan Astor, Shandong Jiacheng, Jinan Caifu, Qingdao Taixu, Qingdao Jinyu, Qingdao Taihe, Dezhou Haomeidijia, Linyi Lantu, Linyi Bolihan, Jinan Hobart Kitchenware, and Tai'an Datang Home Delivery. Make full use of furniture research institutes, comprehensively promote the construction and operation of a northern China furniture research and development base, and build an industrial technology platform providing technical support for the steady and sustainable development of small and medium-sized enterprises. Guide enterprises in developing a diversified market and building a stable timber resource supply and encourage qualified enterprises to set up their own companies and sales networks abroad. Make use of the wood processing park built by Northwest Wood Company in , the 16,000 square kilometers of forest resources bought by Mining Group in Canada, and the national wood processing demonstration area and semi-finished product processing base in Rizhao to provide raw materials to Shandong's furniture production enterprises. Standardize market ordering and support Shandong East Furniture, Jinan Yinzuo, Qingdao Former, Qingdao Haibo, Yanzhou Fuju, Debai Jiaju, Yantai Jiahe, Yantai Lingfangyuan, Binzhou Jiatai, and other furniture stores. Create market positioning and differentiation strategies and carry out diversification of business models in the market in view of the imbalance of furniture production and sales to meet consumer demand at different levels.

(IX) Handicrafts industry. Focus on carpets, embroidery, straw and willow weaving, kite making, New Year's painting, art ceramics, and decorative glass products. Seize the opportunity to carry out product innovation, technological innovation, and equipment updating and take Yunlong Embroidery, Xiangyun Embroidery, Yida Embroidery, Qianrong Embroidery, Embroidery, Shanhua Carpet, Seahorse Carpet, Dongsheng Carpet, Laizhou Artworks, Qingdao Artworks, Aimei Glass, Zibo Baoquan Light Industrial Products Co. Ltd., Zibo Bona Science and Technology Development Co. Ltd., Shandong Binzhou East Oriental Carpet, Shandong Ruixin Carpet, Zibo Refined Color Glazing, and Taishan Ceramics as a backbone enterprises in order to optimize regional layout, implement intensive investment, and build up brands to maintain a leading level in the country. Promote combination of production, study, and research, build up a research and development center for designing toys, jewelry, molds, and new materials, and develop broad market prospects for the toys, jewelry, and souvenirs. Support Zhaoyuan Jinwang and other enterprises in expanding into for arts and crafts and forming new growth points for the handicrafts industry. Preserve traditional heritage, and rescue and protect traditional handicraft varieties featuring historical characteristics that have been in existence for over a hundred years but are now confronting extinction or production decline. Cultivate 70 enterprises with annual sales incomes of over one hundred million RMB, 800 standard-sized enterprises, and 15 production bases with construction output value of more than one billion RMB, turning Shandong into a world-famous procurement center for carpet, embroidery, straw and willow weaving, ceramic arts and crafts, kites, and other such products.

(X) Hardware and weighing apparatus manufacturing industry. Use new materials, technologies, and processes to improve the performance and quality of hardware products. Accelerate the establishment of the Jinan Meide Casting Enterprise Technology Center (malleable iron pipe), Sakura Hardware Enterprises Technical Center (construction hardware), Dongping Jiuxin Tools Industry Technology Center (tools, hardware), Longkou Xinda Tools Technology Center (tools, hardware), Leling Guoqiang Hardware (hardware, locks), and Leling Taishan Sports Equipment Technology Center (sports and stationery). Consolidate and develop a base for hardware products. Take Wendeng Maxpower Tool Group as the backbone to establish a Wendeng hardware and tools production base; take Longkou Xinda Tools Co. Ltd. as the backbone to jointly set up Longkou hardware tool export base; take Linyi Hardware City as the backbone to establish a Linyi Hedong hardware sales base; take Jinan Meide Casting Co., Ltd. as the backbone to establish a Pingyin hardware fittings export base; take Boxing Xingfu town as the target market to establish a joint stainless steel industry base through cooperation with Taishan Iron and Steel; take Yantai Sanhuan as the backbone to establish a lock-making base; foster the development of a Shanghe metal wire mesh production base; take Taishan Sports Industry Group as the backbone to establish a Leling sporting goods production base; and consolidate the development of the Leling hardware and Yangxin tableware industries. Regarding the weighing apparatus industry, strengthen the study of the application of modern measuring technology, communication technology, network technology, and computer technology; strengthen the research and application of high precision, dynamic measurement, and artificial intelligence systems; improve the product structure and market competitiveness; create a manufacturing base engaged in manufacturing of high-precision digital weighing sensors and industrial automatic weighing apparatus like Jinan Goldbell Scales.

(XI) Decorative glass industry. Focus on structural adjustment and change in the model of economic development, take the innovation of systems and technology as the driving force, speed up the pace of upgrading high technology, and strive to achieve breakthroughs in restructuring, indigenous innovation, energy conservation, emissions reduction, and the development of a circular economy. Sum up the typical experience of enterprises in promoting new energy-saving and emissions-reducing technologies and the development of a circular economy, pay attention to energy conservation and environmental protection, and promote sound and rapid development of the industry. Support Shandong Pharmaceutical Glass, Shandong Huapeng Glass, Dezhou Jingfeng Glass, Yantai Changyu Glass, Shandong Jingyao Glass Group, and Linuo Industrial Group.

(XII) Cleaning and household chemical industry. Focus on the development of concentrated powders, enzyme additive powders, multifunctional and special detergents, liquid detergents, and cleaning detergents for public facilities. Accelerate the development of liquid detergent to increase the proportion of liquid detergent among synthetic detergents, and develop phosporus-free and low-phosphorus detergents in order to meet the demands of environmental protection. Actively develop soft, antistatic, sterilizing, and disinfecting liquid detergent free of additives and cleaning agents to be widely used for oilfields, papermaking, manufacturing, automobile manufacturing, and food machinery. Increase the number of soap varieties, focus on the development of perfumed soap and transparent soap, develop composite soap and liquid soap, develop and produce flavor and fragrance derivatives, and use international brands to develop new cosmetics.

(XIII) Battery industry. Pay great attention to development of high-grade lithium ion power batteries and high-grade energy storage batteries. Meanwhile, encourage the development of various batteries for the automotive industry. Appropriately-qualified enterprises are encouraged to develop single lithium ion power batteries for digital electronic equipment. Seize new opportunities in the development of the battery industry, encourage and attract internationally and domestically well-known battery enterprises to set up factories in Shandong, and improve the technology level and quality standards of the entire industry.

IV. Policy Measures

(I) Promote corporate restructuring and develop industrial clusters. Implement the policies and measures promulgated by the central government and provincial government for promoting the development of light industry, persist in carrying out integration of market mechanisms and governmental support, support capable enterprises in increasing investment to introduce strategic partners and establish strategic alliances. Support key enterprises in forming strategic alliances with upstream and downstream enterprises, cultivate large enterprise groups, build up advantageous industrial clusters, and increase the degree of industry concentration. By 2011, cultivate eight food industry clusters, two leather industry clusters, two home appliance industry clusters, four furniture industry clusters, five plastics industry clusters, five arts and crafts industry clusters, and eight hardware industry clusters.

(II) Ensure the expansion of domestic demand and stability in the export market. Use expansion of domestic demand to maintain growth as the fundamental way of improving commodity reserve mechanisms. Establish local grain and oil contingency reserve systems to ensure a sound market supply. Explore the establishment of a commercial reserve system and guide enterprises to maintain appropriate inventory to meet market demand. Speed up the construction of key special markets and expand consumption area coverage through network construction, standardized ordering, logistics distribution, brand displays, and other means. Increase the effort put towards to bring color TVs, refrigerators (freezers), mobile phones, computers, washing machines, and water heaters to the countryside. Develop the conference and exhibition economy and ensure that the Qingdao Shoes, Machines, and Materials Exhibition and the China International Furniture and Woodworking Machinery Exhibition (North) are held successfully. Expand international markets, strengthen traditional markets like those in Europe, , and the United States, and open up emerging markets such as those in the Middle East, Russia, Africa, and Northern Europe. Expand the proportion of material processing and promote industrial upgrading. Strengthen the construction of indigenous brands, and increase our product share in the international market. Take advantage of our competitive home appliance, paper-making, food, bicycle, ceramics, and plastics industries to support qualified enterprises going abroad and to boost exports of equipment and raw materials, and make full use of trade and investment to develop international markets.

(III) Promote scientific and technological innovation and industrial upgrading. Support enterprises in establishing technology centers and encourage the construction of key industry technology service platforms and information networks. Increase investment in scientific and technological innovation, speed up the establishment and improvement of market-oriented scientific and technological innovation systems in which enterprises play a dominant role, have competitive products, and are supported by scientific research institutes. Support qualified enterprises in establishing establish technology centers or work with world famous companies, and research and development institutions, and colleges and universities to set up joint industry technology centers and form alliances. Upgrade the production lines of refrigerators, air conditioning units, central air conditioning units, washing machines, small appliances, and other key components, introduce foreign advanced technology, processing lines, and equipment, and eliminate outdate technology, outdated production capacity, and products to promote industrial upgrading.

(IV) Implement energy conservation, reduction of emissions, and sustainable development. Guide enterprises to adopt sewage treatment and energy conservation technology to achieve waste reduction goals. Accelerate the implementation of cleaner production and comprehensive utilization in the food industry. Thoroughly implement cleaner production, non-wood pulp alkali recovery, wastewater treatment, bio-gas power generation, and online monitoring systems in the paper-making industry. Promote lead-free button alkaline manganese battery technology to create everyday batteries that are free of lead and mercury, and reduce compartmentalization in the battery industry. Promote clean production technologies, e.g. hair saving and de-hairing, lime-free, and ecological tanning technologies, to ensure efficient recycling of solid waste in the leather industry. Increase production of energy-saving products and increase the recycling of waste in the household appliances and plastics industries. In the household appliance industry, establish an industry exit mechanism to eliminate outdated technology, outdated equipment, and outdated production capacity that is unable to meet environmental regulations due to high energy consumption.

(V) Improve the standards system and strengthen monitoring and regulation. Encourage enterprises to adopt national standards and internationally advanced standards to organize production. Strictly implement new national standards for food additives, wine and beer, dairy products, and beverages, implement resource conservation and environmental protection standards for plastic degradation, paper- making, leather tanning, lighting energy consumption, battery recycling, and improve local technical standards systems accordingly. Strengthen the inspection of the raw materials used in cereals and oils processing, edible vegetable oil, meat processing, food additives, fermentation, baking, etc. and conscientiously implement food safety regulations and establish and improve monitoring and traceability systems to ensure food safety.

(VI) Broaden financing channels and strengthen credit support. Encourage private enterprises, foreign- funded enterprises, and intermediary organizations to invest in the construction of key projects through funding, restructuring, shareholding, or technology input. Financial institutions to actively carry out national monetary policies to finance those enterprises which have profitable markets and orders and key industries which are beneficial to the people's livelihood. Governments at all levels to organize enterprises to expand financing channels to solve funding shortages through the issuance of bonds, shares, investment, and private capital.

(VII) Improve taxation policies and increase support. First, earnestly implement preferential taxation policies. Increase policy advertising, make efforts to implement and actively guide enterprises to make full use of preferential tax policies, and strengthen policy implementation supervision and inspection to ensure that preferential tax policies are utilized fully, well, and actively. At the same time, finance and taxation departments at all levels to take full advantage of their roles and actively formulate fiscal and tax policies and tax management measures to promote industrial adjustment and revitalization. Second, proactively integrate special funds to encourage enterprises to upgrade technology; make efforts to promote the optimization and upgrading of product structures and encourage enterprises to be independent and innovative in order to enhance their core competitive ability; support energy savings, emissions reduction, structural adjustment, and technological transformation; and make efforts to promote the transformation of the model of economic development. Third, governments at all levels to expand the mode of financing to financially support major state projects through adjusting the expenditure structure in accordance with relevant national rules and regulations. Fourth, implement the provisions concerning value-added tax in transition of the newly revised national tax law.

(VIII) Strengthen coordination of services and form a joint revitalization effort. Governments at all levels and all departments to take full advantage of their respective functions, increase service coordination efforts, and actively implement relevant policies. Light industry associations and professional associations at all levels to perform their duties seriously, accentuate the role of associations in the areas of industry policy, industry information, operations monitoring, technology upgrading, standards making, trade promotion, industry access, market development, public services, and other such areas in promoting the realization of light industry adjustment and revitalization goals.

Attachment: Work Schedule and Program for Relevant Departments