City digs deep for golden opportunity
FOR Yantai, ''gold coast'' means not so much a tourism lure as a revenue blockbuster: buried under the coastal city is one-third of China's total reserves of the precious metal.
The mainland's biggest gold-producing city, Yantai contributes a quarter of the country's overall production.
Foreign investors, including a former Canadian prime minister, are queueing up to join the industry.
''Gold mining is a pillar industry of Yantai. It makes a great contribution to the city's economy,'' said Yantai Gold Industry Bureau director Lu Hongxun.
On the mainland, any gold mined should be sold to the central government while the local government can apply for state loans to finance operations.
Yantai's mines churned out a profit of 700 million yuan last year, with annual growth of 17 per cent, and now city authorities are putting gold-mining projects up for foreign investment.
''Gold mining used to be banned to foreign investors, but now the rules have been relaxed although the state's approval is needed for individual projects,'' said Mr Lu.
The city is planning a project for foreign investors with investments of 150 million yuan to extract 30 tonnes of gold.
Meanwhile, a project to mine 2,000 tonnes of gold has attracted the interest of potential investors, including a Hong Kong businessman and a former Canadian prime minister who are negotiating participation in the project.
The central government's approval has been granted for both, according to Mr Lu, and work is scheduled to start this year.
Yantai's identified gold reserves would last for 50 years, he said.
Mr Lu estimated there were up to 50 gold accessory shops in Yantai, serving the demand from a community with rapidly rising living standards and incomes.