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Tax cut, house loans to help quake victims
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The State Council, China's Cabinet, has unveiled a raft of measures to support reconstruction after the May 12 devastating earthquake, including tax exemptions for companies that suffered heavy losses.

It also promised a six-month extension on all loan repayments in arrears due to the quake. The affected companies would be given priority in applications for initial public offerings on the stock market or refinancing plans if already listed.

"The affected organizations are also encouraged to raise funds for reconstruction on the bond market," the Cabinet announcement said.

Insurance institutions would be instructed and coordinated to invest funds in key reconstruction projects as well as infrastructure in the quake zone, according to the statement.

The earthquake that jolted southwest China's Sichuan Province has killed nearly 70,000 people so far. The number of injured is 374,177 and there are 18,403 people still missing.

The State Council also said that new homes for survivors would be exempt from land use and other land-related taxes. In addition to subsidies averaging 10,000 yuan for each homeless household, interest on home loans to quake survivors would be lowered by 40 percent, compared with the benchmark interest rate.

The minimum down-payment would be cut to 10 percent of the loan, compared with 20 to 50 percent in other parts of the country.

The State Council also pledged to find employment for at least one member of each jobless family, and to subsidize the required social security insurance for companies that employed such people.

The agricultural sector in Sichuan suffered enormous damage, estimated at around US$6 billion, as a result of the earthquake, the UN Food and Agriculture Organization said yesterday.

According to an FAO assessment mission, more than 30 million people in rural communities were severely hit and lost most of their assets. Thousands of hectares of farmland was destroyed, millions of farm animals killed, houses and grain stores ruined and thousands of pieces of agricultural machinery damaged.

"In addition to the human tragedy caused by the disaster many rural communities in Sichuan have lost their means to produce food and create income," said Rajendra Aryal, FAO senior regional emergency coordinator. "It will probably take three to five years to rebuild the agricultural sector in Sichuan."

(Shanghai Daily July 1, 2008)

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