Private enterprises have emerged as the economic front-runner in northwest China's underdeveloped Ningxia Hui Autonomous Region, after years of no-growth and financial mess.

By the end of last year, about 4,790 private firms have been established in Yinchuang with registered capital of 2.59 billion yuan (nearly 298 million US dollars), surging from 393 private firms in 1990 involving only 58 million yuan (about 6.8 million US dollars).

Some 62,000 people are employed in these booming enterprises now, a jump from 5,500 employees ten years ago, according to Chen Maolin, secretary-general in charge of the private business in Ningxia.

The private firms here have created a gross domestic product (GDP) of over 5.7 billion yuan last year, accounting for a quarter of the autonomous region's total, statistics show.

Lured by the preferential policies and a satisfactory investment environment, investors from the United States, Japan and Malaysia have set up some 430 joint ventures here since 1992, with 580 million US dollars of investment.

Ningxia is abundant in agricultural and mineral resources but is also an economically backward land-locked region in China.

Since 1994 when the autonomous regional government designated the development of private economy as a pressing task, more preferential policies have been introduced to help local residents open their own businesses.

A local survey shows that four private firms here reported their capital over 100 million yuan, 34 firms showed in excess of ten million yuan and another 121 registered capital of more than five million yuan.

The regional government has set a goal to accelerate the growth of private firms at the speed of 20 percent annually by the year 2002, when the GDP is expected to make up 40 percent of the region's total. About 60 percent of the local residents will be involved in these firms by that time, according to the government's plan.