Northeast China's Liaoning Province will foster private businesses and foreign investments to enhance the economic structure of its perennial heavy industrial base, Liaoning Governor Bo Xilai said.

The move echoes the release of the central government's plan in August to turn the northeastern region into a new powerhouse for the country's economic growth.

Bo said development of the non-State sector will be a key link in Liaoning's effort to cultivate an open and market-oriented economy.

"The market system does not come at officials' will. When more and more private and foreign-funded businesses grow up, an open market will take shape as a natural result,'' Bo said at a press conference recently in Shenyang, Liaoning Province.

Liaoning is planning to introduce some 1,000 foreign-funded projects within the next five years with each absorbing more than US$10 million in foreign capital. The province aims to procure US$30 billion in foreign investment by 2007.

Bo has suggested the central government delegate the approval of foreign-funded projects worth less than US$200 million down to the provincial government level.

Liaoning is also trying to double the number of non-State companies with a sales income above 100 million yuan (US$12 million) to 570 million yuan (US$68.7 million) in five years.

The provincial government expects non-State businesses to take up 47 per cent in local gross domestic product (GDP), and generate 7.7 million jobs by 2007.

Local administrations will assume guiding roles in Liaoning's economic restructuring, but will try to avoid interfering in the market, Bo said.

The northeastern region, which covers three provinces -- Heilongjiang, Jilin and Liaoning -- is a traditional heavy industrial base habouring the country's most important steel plants, metal mines and oil fineries, as well as war factories.

The region gradually lost its past glory after China introduced a market system a decade ago, largely because of heavy taxation duties and an overstaffed State sector.

Yet its upper-reach industrial products still play a central role in the lifeline of China's economy.

It is generally believed the region will soon rise from its nadir with its unique industrial infrastructure and the central government's latest "northeastern rejuvenation'' scheme, a strategic move paralleling the opening-up of coastal areas and the development of the less affluent western region in past years.

Liaoning accounts for nearly half of the GDP and more than 70 per cent of the export and foreign investment in Northeast China.

The Chinese Government plans to make Liaoning a world-class supplier of equipment and new materials, such as precision machine tools, large crude carriers and diesel locomotives.

Many companies based in Liaoning expect the government plan to expand their business prospects in the future.

"Liaoning's heavy industrial infrastructure is peerless in China, and investment in industrial fields will be rewarding,'' said Wang Shoubin, the general manager of Qinghua Group, a private company making refractory magnesia bricks in port city Yingkou.

Although the province has long been dominated by the State sector, the local government has offered many favourable policies to create an atmosphere that is friendly to non-State businesses, he said.

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