Kashgar prefecture, one of the least-developed areas in northwest China's Xinjiang Uygur autonomous region, is expected to enter a new stage of growth following investment from companies in Shandong.

On April 28 an environmentally friendly cement plant built with 1.4 billion yuan ($222 million) in investment from Shandong's Sunnsy Group began operation in Kashgar's Yengisar county. It is projected to produce 1.5 million tons of cement annually.

Earlier this year, another 33 Shandong-backed projects began production in the county. Requiring a combined investment of 1.9 billion yuan, the projects include machinery and vehicle manufacturing, new energy and building materials production, as well as food processing and agriculture.

Liu Yutao (right), manager of Xiangfei Lake Flower Farm, show guests around a greenhouse. Photo by Ju Chuanjiang / China Daily

The projects are among more than 200 projects in Xinjiang that have been started by Shandong companies after the central government began a program in 2010 that requires developed eastern regions to offer economic assistance to Xinjiang.

According to the program, 19 developed provinces and municipalities are required to contribute 0.3 to 0.6 percent of their government revenues from 2011 to 2020 to support Xinjiang's development.

Shandong is assigned to help four poverty-stricken counties in Kashgar — Shule, Yengisar, Yopurga and Makit — that have a combined population of 954,000, almost 35 percent of them living below the poverty line.

"Shandong's new assistance package is more complete than before," said Wang Hua, chief of Shandong's assistance program in Xinjiang. "In addition to direct financial aid, we are launching investment projects offering funds, technology and management expertise to our partners."

205 projects

According to Wang, 24.6 billion yuan in funding from companies in Shandong has started 205 projects in the four counties. The effort is expected to create at least 50,000 jobs.

Construction on 115 of the projects was completed last year.

The projects aim to improve local people's living standards through building residential and industrial facilities, promoting vocational education and offering employment. Plans call for development of an industrial park and a modern agricultural park in each of the four counties.

Over the past two years, the Shandong government has helped a number of companies develop businesses in Xinjiang by building various industrial parks, including an iron and steel park in Shule, a building materials park in Yengisar, a comprehensive industrial park in Yopurga and an agricultural park in Makit.

Total funds from three major investors alone — Shandong Iron and Steel Group, Sunnsy Group and Shandong Heavy Industry Group — have now surpassed 10 billion yuan.

A 7.3 billion yuan iron and steel facility funded by Shandong Iron and Steel Group is under construction in Shule county, the first of its kind in south Xinjiang. When finished in October, it is projected to produce 3 million tons of iron and steel, and generate 9.5 billion yuan in sales revenue annually.

Due to rising local demand, the building materials industry is another focus of Shandong investment.