the western development drive. At present, it is necessary to strengthen the role of government finance and bank finance, including the coordinating support between central finance and banking, coordinating support between local finance and banking, bringing into play the market mechanism and strengthening special economic support, etc. This includes the following four levels:

(1) The central finance will be mainly used to develop railway, highway, civil aviation and transportation infrastructure, large-scale water conservancy and hydroelectricity construction, and parts of environmental protection projects. The basic ways are as follows: The State will input finance or bond funds according to needs and possibilities each year. The State Development Bank may increase by a certain amount long-term loans to complement the State on the basis of the bond issuing and fund raising ability of the market, and repay the loans with new bond funds and local funds. In this way, people can first construct and then repay their loans each year to prevent financial risks. As a result, all problems can be solved ahead of schedule.

(2) The local finance will be mainly used in urban infrastructure construction. The basic ways are as follows:  With the support of the municipal government, repayment will come from the building expenses of the local financial budget and the payment of stipulated fees. These projects should be coordinated by legal institutions confirmed by the government. They will obtain their loans together. Approved by the National People's Congress at the same level, they can repay their loans as a whole. The loan time limit can also be prolonged.

(3) Common loans will be mainly used to develop industrial and agricultural projects with local characteristics. The basic procedures are: The development bank cooperates with the local commercial banks. After careful selection, the development bank wholesales loans to the commercial banks and the commercial banks undertake to issue and repay the loans.

(4) The development bank issues long-term loans for such major projects as petroleum and natural gas according to normal risk principles. The loan will be repaid from trade incomes.

Chen Yuan said that these four levels would form the basic framework and credit system to support the western development, as it is beneficial for arousing the enthusiasm of the people who will undertake the responsibility and risks. The major contribution of the system is that it will solve long-term problems of fund sources and risk prevention.