At the same time, the country will continue to close down small and illegal coal mines and help those large and medium-sized coal enterprises to make up the deficit and start making profits.

The remarks were made at the All China Coal-ordering Fair, which began Monday in Yantai, a coastal city in east China's Shandong Province.

The fair is being held to make arrangements for the production, storage, transportation and sale of coal, allocating coal effectively around the country. It is sponsored annually by six ministries and commissions.

At the opening ceremony, the number of representatives reached 1,000. It is expected that more than 20,000 people from all over the country will take part in the 15-day event.

Participants are expected to make deals with their business partners in Yantai and place their coal orders for the year.

Zhang Guobao, vice-minister of the State Development Planning Commission, said both coal supply and demand went up in 2000 thanks to steady economic growth.

China produced 957 million tons of coal last year, 473 million tons less than in 1998. The decrease, mainly attributed to the State's control of the industry, led to the fortuitous increase in the price of coal last year. Statistics show that the closing of small coal mines has led to a decline in production of 300 million tons in recent years.

Three years ago, most coal enterprises were having a hard time because of the low price of coal.

In 1999, the country started to close down small and unregistered coal mines, at the same time imposing production limits on large and medium-sized coal ones.

The country exported 58.8 million tons of coal last year, a big increase from 1999. Zhang said the rise in the price of oil in the world and the economic recovery of Southeast Asian countries led to a increase in coal demand last year. This year, China plans to export 63 million tons of coal, adding 5 million tons to last year's figure.

Zhang also said China would put more capital into the development of coal technology. He said coal-liquefying technology had been listed as one of the 12 major things needing development during the country's 10th Five Year Plan (2001-2005).

Last year, China imported 70 million tons of crude oil, making the country the third largest oil importer in the world. In 1993, the country became a net importer rather than an exporter of oil. The country has not discovered any large oilfields in recent years, and as such, oil imports will continue to increase as the country's economy marches forward, Zhang said.

The use of coal instead of oil, especially in its vapourized and liquefied forms, is one way of relieving the country's hunger for energy, Zhang said, especially as coal in China is much cheaper than it is in most other countries.

(China Daily 02/06/2001)