Inner Mongolia
Inner Mongolia|Shaanxi|Tibet|Guizhou|Guangxi|Yunnan|Xinjiang|Gansu|Ningxia

Inner Mongolia Autonomous Region
Regional Chairman:
Ms. Uyunqimg
Regional government office address: 1 Xinhua Dajie, Hohhot City 010055
Tel: 0471-6944404
Geographical location
Inner Mongolia, China's northern border autonomous region, features a long, narrow strip of land sloping from northeast to southwest. It stretches 2,400 km (about 1,491 miles) from west to east and 1,700 km (1,056 miles) from north to south. Inner Mongolia traverses between northeast, north, and northwest China. The third largest among China's provinces, municipalities, and autonomous regions, the region covers an area of 1.18 million square km (about 455,598 square miles), or 12.3 percent of the country's territory. It neighbors eight provinces and regions in its south, east and west and Mongolia and Russia in the north, with a borderline of 4,200 km (about 2,610 miles).
I. Geography and natural conditions

Besides hills, plains, deserts, rivers and lakes, Inner Mongolia has plateau landforms, mostly over 1,000 meters (about 13,780 feet) above sea level, including the Inner Mongolia Plateau, the second largest among the four major plateaus in the country.

Inner Mongolia has a temperate continental climate. There, spring is warm and windy; summer is short and hot with many rainy days; autumn usually sees early frost and plummeting temperature; winter is long, bitter cold with frequent polar outbreaks. The region has an annual precipitation of 100-500 mm, 80-150 frost-free days, and 2,700 hours of sunshine. The Greater Hinggan Mountains and the Yinshan Mountains divide the regions into areas with different climate. The area east of the Greater Hinggan Mountains and north of the Yinshan Mountains has lower temperature and less precipitation than the opposite area.

Natural resources

Animals and plants:
Inner Mongolia has 2,351 species of plants including vegetation of arbors, shrubs and herbs. It is home to 117-plus species of wild animals and 362 species of birds, 49 species of them under state and regional protection and 10 precious and rare.

Inner Mongolia has water resources of 90.3 billion cubic meters, of which 67.5 billion is surface water. Nearly 1,000 rivers run in the region, 107 rivers averaging a valley area of more than 1,000 square km each. Moreover, 1,000 lakes dot the region, eight of them with an area of over 100 square km each. Inner Mongolia boasts mineral water and springs with medical value. It has a total water area of 984,300 hectares including 655,000 hectares of fresh water, which accounts for 10.68 percent of the country's total fresh water area.

Forests, grasslands, and cultivated land:
The region has 7.22 million hectares (17,840,937 acres) of cultivated land, or 6.11 percent of the country's total, 86.66 million hectares of grasslands, or 73.3 percent of the country's total, and 18.66 million hectares of forests, 15.8 percent of the country's total.

More than 120 kinds of minerals of the world's total 140 kinds have been found in the region, five of which have the largest deposits in China and 65 of which rank among the top ten of their kinds in the country. The reserves of rare earth amount to 84.59 million tons, or 80 percent of the world's total and over 90 percent of the country's total. The proven deposits of coal hit 224.75 billion tons, the second largest in the country. The region has large reserves of ferrous metals, non-ferrous metals, precious metals, and industrial chemicals, and non-metal minerals. It also has abundant oil and natural gas and 13 large oil and gas fields have been discovered with expected oil reserves of 2-3 billion tons and gas reserves of 1,000 billion cubic meters. The minerals (excluding oil and natural gas) in the region have a potential value of 13,000 billion yuan, accounting for 10 percent of the country's total volume and ranking as the third largest in the country.

Inner Mongolia is rich in tourist attractions: Colorful ethnic culture, grassland scenery, the virgin forests in the Greater Hinggan Mountains, grand views along the Yellow River, the majestic Xiangsha Gulf, rivers and lakes, and springs. Inner Mongolia is home to the Mausoleum of Genghis Khan, the Zhaojun Tomb, ancient Great Wall, Wudang Monastery at the bottom of the Yinshan Mountains, Wuta Monastery, Bailing Temple, and tomb murals dating back to the Eastern Han Dynasty (25-220).

Environment and current policies:
Owing to its special geological condition, Inner Mongolia features a harsh eco-environment. In recent decades, the greenhouse effect and unscientific exploitation have aggravated drought, desertification, and soil erosion. The desertified land and the potential ones cover 60 percent of the regional area and are increasing 670,000 hectares per year.

The desertification and alkalization of grasslands have brought frequent sandstorms. The deterioration of water conservation capacity of the Greater Hinggan Mountains has resulted in floods in the Songhua and Liaohe river valleys. Each year 300 million tons of soil are washed away in the Yellow and western Liaohe rivers, or 30,000 hectares of land lost. As a result, rivers are choked with silt that stops their flow.

To improve ecological environment, the Ecological Construction Project, one of the ten projects of the western development campaign, has been launched recently in the region which includes turning the cultivated land into forests and grasslands, planting grass and suspending animal husbandry, shelterbelts in the northeast, northwest and the north, anti-desertification, virgin forest protection in the Greater Hinggan Mountains, and resettlement. It is expected that by 2005 the deteriorated eco-environment can be brought under control, with first steps at reclamation achieved by 2010, and that mountains will be green and rivers clear again by mid-century.


II. Population and ethnicity

Total population:
23.62 million

Population growth rate: 9.7

Life expectancy (average):

Forty-nine ethnic groups live in Inner Mongolia including the Mongolian, Han, Manchu, Hui, Daur, Ewenki, Oroqen, and Korean. The region is inhabited by 3.97 million Mongolians, 18.75 million Hans, and 900,010 of other groups. The rural population hits 13.78 million, with 11.87 million in villages and 1.91 million in pastoral area.

Inner Mongolia has 500,000 technicians, 140,000 of whom have received senior and middle-level technical certificates. It has 324 scientific and technological research centers. By 2000, 71 counties in the region had implemented the nine-year compulsory educational campaign and basically eliminated illiteracy among young and middle-aged people. As many as 99.44 percent of children of school age enjoy school education, 96.6 percent of children of secondary-school age enter junior middle school and 60 percent of them graduate. Inner Mongolia has 72,000 university students. The percentage of literate middle-aged and young people has reached 96.8 percent.

In 2000 the region had 10,147 primary schools in 6,299 places, 1,707 middle schools including 1,330 junior secondary schools and 377 senior secondary schools, 425 polytechnic middle schools including 269 junior polytechnic secondary schools and 156 senior polytechnic secondary schools, 18 universities and colleges, and 12 adult-education schools.


III. Economy

Inner Mongolia has national iron and steel and coal production bases. In addition, it has industries of forest, farm produce processing, electricity, machinery, chemicals, electronics, textile, sugar, paper making, and light industry. It has a developed agriculture and animal husbandry. The region is a national production base of cash grain, oil, and sugar. It is also an important animal husbandry base, ranking the top among the five major pastoral areas in the country.

GDP: 140 billion yuan (US$16.9 billion) (2000)

GDP growth rate: 9.7 percent (2000) and averaging increasing rate of 10 percent during the ninth Five-Year Plan (1996-2000)

Average GDP per capita: 5,350 yuan (US$646) (1999)

Urban and rural income:

From 1989 to 1997 Inner Mongolia was the poorest in China in terms of the disposable per capita income of urbanites and rural residents. In 1999 it ranked 22nd in the country. In 2000 the disposable per capita income of urbanites and rural residents amounted to 5,120 yuan (US$618), 7.3 percent up over the previous year, a 58.9 percent increase over the end of eighth Five-Year Plan period (1991-95), and averaging an annual increase of 9.7 percent. The average per capita income of rural residents hit 2,050 yuan (US$248), with an annual increasing rate of 5 percent.

GDP ratio (1st, 2nd, and tertiary industries): 25:39:36 (2000)

Added value and growth rate (1st, 2nd, and tertiary industries) (2000): 35.2 billion yuan (US$4.25 billion), 55.2 billion yuan (US$6.67), and 49.6 billion yuan (US$5.99 billion) respectively; 2.6 percent, 12.3 percent, and 11.6 percent increase over the previous year respectively; averaging annual increase rate of 6.4 percent, 11.7 percent, 10.7 percent during the ninth Five-Year Plan (1996-2000).

Poverty-alleviation plan
By the end of 2000, Inner Mongolia still had some 804,000 poverty-stricken people without necessary food and clothes and three million in unstable situation. It needs to resettle 200,000 people.

Inflation rate (2000): consumption price 1.3 percent up over the previous year.

Unemployment rate: 3.34 percent (2000)

Revenues: 15.56 billion yuan (US$1.9 billion) (2000), doubling that by the end of eighth Five-Year Plan period and with an annual increasing rate of 15.3 percent; local revenues being 11 billion yuan (US$1.3 billion) with an annual increasing rate of 20.4 percent.

Foreign trade
Inner Mongolia has conducted trade, economic and technological cooperation with nearly 100 countries and regions in the world. Its exports come in 1,000 categories. Trade with Russia and Mongolia thrives. During the ninth Five-Year Plan, the region achieved US$7.58 billion in import and export, with an export of US$4.16 billion. In 2000 it obtained US$2 billion in foreign trade, the export being US$1 billion. The region has 18 opening ports, 11 A-grade and 7 C-grade; and 16 development zones, four of state level and 12 of regional level.

Foreign investment
By the end of 2000, the region had 1,871 foreign invested enterprises and a contracted foreign investment of US$2,559.32 million. It received loans of US$1.72 billion for its 78 projects from international financial organizations and foreign countries, with a total of US$52.78 million from foreign governments for its 43 projects. The projects cover 70-plus counties in the region and involve agriculture, education, health, communications, energy, and environmental protection. Foreign loans account for 5.1 percent of the total fund for fixed asset investment. It has actually utilized 43.14 billion yuan of foreign funds.

Key industries
Farm production and processing as well as animal husbandry; energy; metallurgy and chemicals.



IV. Post and Telecom



A modern post and telecom network has been set up which serves the whole region and links the region with the outside world. By the end of 1999, it had a fixed asset investment of 1.5 billion yuan (US$181.2 million) in post and telecom and a postal length of 62,000 km. Towns and townships have been accessible by postal communications and counties in the region offer computer-controlled postal service. Eight main express mail ways have been built to link the region with other cities such as Beijing. Its express mail can be delivered to the rest of the world.

Telecom and telephones:
So far, a digital telecom transmission network has been established in the region that features transmission via optical cable in addition to satellite and digital microwaves. The network has facilitated the construction of regional digital and information portal. The long-distance-call national A-grade cable includes the Beijing-Hohhot-Yinchuan-Lanzhou cable line and the regional Hohhot-Xi'an, Hohhot-Beihai, Zhalantun-Qiqihar, Ulanhot-Baicheng, and Chifeng-Chaoyang lines. Its transmission facilities utilize the updated SDH technology. The number of telephone users exceeds 1.5 million and the public telephone network has an installed capacity of 2 million.

Radio and TV stations
The radio and television system has served 81.3 percent of the total region.


V. Transportation

The region has 14 main national and 12 feeder railways as well as five local railways, with a total length of 7,083 km. The density is 59.9 km/10,000-sq-km. The Beijing-Tonghua, Beijing-Baotou, and Baotou-Lanzhou railways traverse west to east through the province, which link the northeast, the north and northwest of China. Manzhouli and Erenhot, two large land ports in the region, connect the region with Russia and Mongolia, and European countries.

It has a total length of 63,000 km, with a density of 532.6 km/10,000 square km. More than 95 percent of townships have access to highways.

It has seven civil airports, which are open to 20 domestic and two international air routes, with a total length of 67,000 km.

VI. Major fields and projects wanting foreign investment

Industries encouraged to draw investment:
1. Deep produce processing of farming and animal husbandry and comprehensive development of agriculture and animal husbandry;
2. Infrastructure construction of water conservancy, electricity, communications, ports, and urbanization and public welfare undertakings;
3. Exploitation of rare earth products and development of bio-engineering projects, research and development of hi-tech industries planned by the regional scientific and technological department;
4. Development of tourism resources;
5. Environmental protection projects including improvement of barren mountains, barren slopes, and other wasteland, and project of turning cultivated land into forests and grasslands;
6. Exploitation, extraction, and processing of mineral resources;
7. Sophisticated chemical industry, petrochemical industry, and processing of coal;
8. New building material development and recycling of waste and old resources;
9. Asset recombination of enterprises in Inner Mongolia in the forms of merger, purchase, and shareholding.

Projects available to foreign investment
1. High-quality production line of activated carbon;
2. Promoting base of embryo transplant of cows and mutton sheep;
3. Production of new Mongolian medicine;
4. Efficient water-retaining project of cornstarch with an annual production of 150,000 tons;
5. Production of natural carotene;
6. Ancient Zhaojun Ethnic Garden of Inner Mongolia;
7. Project of aluminum sheets with foil with an annual production of 10,000 tons;
8. Construction of Kaolin production base;
9. The third-phase water expansion project of Dongsheng City;
10. The multi-functional gymnasium construction in Baotou;
11. House refuse treatment;
12. Shareholding transfer of Baotou Jinxing Medicinal Capsules;
13. Follow-up project of rare earth separating line with a capacity of 3,000 tons;
14. The Yihua natural gas-made methyl with an annual production capacity 150,000 tons;
15. Technological renovation of cashmere spinning with an annual production capacity of 200 tons;
16. Lysine production in Huameng Jinhe with an annual capacity of 10,000 tons;
17. Billet casting project of the Baotou Iron and Steel Co.;
18. Series new products of ephedrine.

VII. Favorable policies for foreign investment

Article 1
These provisions are formulated according to the relevant stipulations on foreign investment of the state and Inner Mongolia in an attempt to widen opening-up, attract foreign investment and stimulate the export-oriented economy.

Article 2
These provisions shall apply to the foreign companies, companies of Hong Kong, Macao, and Taiwan, private enterprises, Sino-foreign joint ventures, Sino-foreign cooperative enterprises, foreign-owned enterprises within Inner Mongolia, and public undertakings.

Article 3
The foreign invested enterprises, engaging in the industries encouraged by regional government and with an operational period of more than ten years, are levied business income tax since the profit-making year and then returned within five years by local financial sector. The local government will take 25 percent of the value-added tax, which will be returned to the foreign invested enterprises within five years of production. For those foreign invested enterprises with less than ten years of operation, the returned business income tax and value-added tax will be paid back to local government.

Article 4

Inner Mongolia encourages the establishment of foreign invested enterprises involving large investment.

1) The foreign-funded productive and hi-tech enterprises established in the development zones, regional capital, and border cities with approval by the State Council shall be levied the same income tax as foreign-funded and foreign enterprises in China's coastal opening cities and development zones.
2) The foreign invested enterprises in service industries with an investment of US$5 million and operational period of more than ten year are levied tax according to the designated rate since its profit-making year and 50 percent of the tax will be returned to the foreign invested enterprises by local financial sectors.

Article 5
The hi-tech and export-oriented enterprises in the development zones of the region are levied taxes according to state stipulations and the part exceeding 15 percent will be returned by local financial sectors.

Article 6
Foreign investors of the foreign invested enterprises who reinvest their share of profits in their enterprises to expand production and establish export-oriented enterprises with an operational period of no less than five years will receive a refund of the paid income tax for the amount of reinvestment, subject to approval by local taxation authority. Their own or entrusted export may enjoy current state tax reimbursement. When their export volume accounts for more than 60 percent of the total production value, the portion exceeding 10 percent of the business income tax shall be first collected and then returned to the enterprises by local financial sectors.

Article 7
The foreign invested enterprises enjoy the local income tax exemption.

Article 8
The foreign invested enterprises in the fields of infrastructure construction including energy and transportation are encouraged to take the investment form of BOT, project financing and operational right transfer. The foreign investors in the fields of major transportation projects and renovation of old cities may expand the area of land development and service industry with relevant approval. The foreign invested enterprises can decide the price and charging criteria of their products and service with the approval of the regional financial and price-control departments. Foreign investors are encouraged to build high-level highways and the business income tax from the tolls will be first collected and then returned to foreign investors within eight years since the traffic opening day.

Article 9
Foreign investors are allowed to obtain the full or part of the SOEs' property rights through the forms of purchasing, shareholding, and incurred obligation with the approval of the governments above county level.

Article 10
Foreign-funded enterprises are entitled to the following preferential policies for the use of land:
1) The foreign invested enterprises are exempted from land use fee within construction stage.
2) Foreign investors running enterprises on its former location shall be exempt from land use fee within the first five years of operation, with an operational period over ten years.
3) With an operational period of over 15 years, the export-oriented enterprises, hi-tech enterprises, and enterprises in the fields of energy, transportation, infrastructure, exploitation of resources, and raw materials exempt from land use fee since its production for five years with an investment of US$0.5-1 million, seven years with an investment of US$1.01-3 million, ten years with an investment of US$3.01-5 million and 15 years with an investment of over US$5 million.
4) The foreign invested enterprises in the field of grassland improvement will develop animal husbandry in line with the regional plan after gaining right of land use.
5) Foreign investors in plantation and breeding industry may enjoy a long-standing land use right for at most 50 years with approval of authorized government.
6) Foreign investors in the fields of developing barren mountains and wasteland are encouraged to develop them into farm-oriented land and may use the land for 50 years with approval of authorized government. For those developing wasteland into construction use land, retention of land transfer fee will be first collected and returned to foreign investors by local financial sectors after the development reaches the contracted scale.
7) Foreign investors in the field of urbanization enjoy preferential policies accordingly.

Article 11
To attract investment for projects in remote areas in Inner Mongolia, foreign investors can carry out the projects in the development zones in the region after application. Relevant departments offer convenient service of related procedures including approval and tax transfer.

Article 12
The foreign invested enterprises are allowed to get loans preferentially for the turnover fund and other needed fund with approval of the banks of their deposits. The foreign invested enterprises can apply for loans in RMB on pledge of spot exchange, fixed assets, and other properties allowed by the state.

Article 13
The foreign invested enterprises shall be charged at the same rate as Chinese enterprises and Chinese citizens when getting service of operating expenses, and charges can be settled in RMB. Priority shall be given in ensuring the supply of water, electricity, heating, and telecom facilities needed in the production and operation of foreign-funded enterprises and foreign-funded public undertakings. The charges should be the same as those of Chinese enterprises.

Article 14
The export-oriented foreign invested enterprises, hi-tech foreign invested enterprises, and productive enterprises in the fields of energy, transportation, infrastructure, and raw materials shall be levied half of the fees for auxiliary urban infrastructure.

Article 15
Priority should be given to the foreign invested enterprises by local communications department in terms of production transportation.

Article 16
Foreign staff of the foreign invested enterprises shall have the same national treatment concerning accommodations, taking buses, and medical care in Inner Mongolia.

Article 17
The board of directors of the foreign invested enterprises is entitled to decide the salaries and bonus criteria according to relevant state regulations and reports to the labor department. The Foreign invested enterprises hire their employees by themselves and handle needed procedures with local labor department.

Article 18
The foreign invested enterprises enjoy relevant preferential polices of the state and Inner Mongolia Autonomous Region when hiring the laid-off workers from the SOEs.

Article 19
The procedures of examination and approval of the report submitted by the foreign invested enterprises cannot exceed 10 days. After the foreign invested enterprises go through all needed procedures, the autonomous region, the Foreign-Investment Office and Center of Project Approval will coordinate their work and one-stop service will be offered by industrial and commercial department, taxation sector, planning department, and departments of environmental protection, urban construction, land use, foreign trade, and finance.

Article 20
The lawful rights and interests of foreign-funded enterprises are protected by law. Relevant departments should observe the following regulations:

1) No inspection and punishment is allowed to be given to the foreign invested enterprises without the guideline of laws, rules, and regulation.
2) No departments or individuals except authorized organizations shall force banks to assign capital or freeze deposits of the foreign invested enterprises or seal up the legal property of the foreign invested enterprises.
3) The lawful rights and interests of foreign-funded enterprises allow no infringement.

Article 21
In case that policies formulated in the past to encourage foreign investment do not conform to the above policies, take these policies as the guideline.

Article 22
The policies shall be implemented on the day of promulgation. The Foreign-Investment Office under the People's Government of Inner Mongolia Autonomous Region is responsible for explaining the policies.