THE income gap between the eastern and western regions of China has apparently narrowed - thanks to the flourishing of rural enterprises last year, the China News Service (CNS) said yesterday. Quoting statistics released by the Ministry of Agriculture, the agency said the total output of village and township enterprises in 20 provinces and regions in central and western part of China had gone up by 400 billion yuan (HK$355.2 billion) last year. It represents an increase of over 60 per cent on the previous year, which is 10 percentage points more than the national average. The total output of rural enterprises in 1993 is set to reach 3,000 billion yuan, according to official estimates. The 1992 total was 1,700 billion yuan. CNS pointed out that the central Government set aside a special fund of five billion yuan last year to boost the development of rural enterprises in the impoverished central and western region. Regional authorities also pumped more funds into the sector. The CNS report said the total investment in the region comprised more than 25 per cent of the total investment in the nation as a whole last year. The figure in 1992 was 23 per cent. It said the total amount of investment in the central and western region had reached 35 billion yuan. Senior officials have indicated that further growth of the booming village and township enterprises would be the most effective way to increase income in the countryside and absorb surplus rural workforce. According to initial estimate, these enterprises absorbed an additional 3.3 million surplus rural workers last year, representing about 60 per cent of the total number of new workers in rural enterprises across the country. Rural enterprises employ more than 112 million people. The total output of village and township enterprises in the central and western region was about 35 per cent of the national total, it said. The report said some problems with the development of village and township enterprises in the poor region remained unresolved. The task of speeding up the development of those enterprises was still arduous, CNS said. A commentary in the People's Daily said rural enterprises should be further boosted in both quantity and quality. They should explore new overseas markets and upgrade their technology and management, it said. The newspapers also called on operators to abide by laws to engage in fair competition, protect consumers' rights and benefits, and fulfil their tax obligations to pay tax.