This report is written by Our Staff Reporters Xia Jun and Meng Xi'an on their travel to the west.

They quoted Shangluo Prefecture Administrative Office Commissioner Liu Weilong as saying: Macro-environmental construction is important, but construction of the micro-environment cannot be neglected either. To improve the micro-environment, it is first necessary to emancipate the mind and update concepts. Only by promoting development through opening-up, is it possible to connect it with the western development strategy and to seize the opportunity to make further progress. Following are excerpts of the report.

It is out of the reporters' expectation that their travel from Xi'an to Shangzhou took them only two hours instead of the previous four-five hours. This is attributed to the completion of the National Highway 310 which has shortened the distance from Xi'an to Shangzhou.

Shangzhou City is the location of the Shangluo Prefecture Administrative Office. All the seven counties (county-level cities) of the prefecture are poverty-stricken counties, per-capita annual income of farmers is about 1,000 yuan, and nearly 60,000 people have yet to solve the problem of getting enough food and clothing.

The deepest impression they got about Shangluo is cultivated land there is extremely limited. The prefecture has a population of 2.46 million but only 2.2 million mu (15 mu = one hectare) of cultivated land. The key to getting rid of poverty is to end the state of being closed to the outside. However, before the Xi'an-Ankang Railway started construction, there was no railway within a radius of 20,000 km in Shangluo. On December 30 last year, the thunderous roar marked the start of the construction of the East Qinling Tunnel of the Xi'an-Hefei Railway. The dream of the people of the old revolutionary area, who have been longing for a railway for 40 years, will come true soon! Local people greeted the railway construction team as they did to the People's Liberated Army during the Liberation War years. Take Zhen'an County for example. Previously it was a closed, poor small county in a mountain area, just two-odd years after the Xi'an-Ankang Railway was started construction, the county seat had a hotel, a bowling hall which is the only one in Shangluo Prefecture, a 10,000 floating population, the number of taxis shot up to more than 160, exceeding the total of six other cities (county-level cities) in Shangluo! Then, in the future when the Xi'an-Ankang Railway and the Xi'an-Hefei Railway, the two railway arteries that link up with northwest, southwest, south and east regions of China, are completed and opened to traffic, Shangluo's five county towns and 58 townships (towns) will be accessible to railways and a great impetus will be given to Shangluo's economic development. An old farmer in Shanyang County said with emotion, "Blessed by the Communist Party of China, I've experienced four major auspicious events in my life: first, I've been emancipated; second, I've been given plots of land; third, I've witnessed the implementation of the all-round contract system; and fourth, I've been able to see the launch of the western development strategy."

What impressed the reporters most is the talk given by Liu Weilong, the Shangluo Prefecture Administrative Office. He said: It is naturally important to greet the large-scale development of the west region, and the construction of highways, railways and other macro-environmental facilities, but construction of the micro-environment equally cannot be neglected. To improve the micro-environment, it is first necessary to emancipate the mind and update concepts, overcome the small-production mentality characterized by closed-doorism and conservatism, overcome the ideas of awaiting, depending on and asking help from the higher authorities, and substituting this with the market economic mode of thinking. Only by promoting development through opening to the outside world, is it possible to be linked up with the western development strategy, and to seize the opportunity to make further progress.

In the decisive battle to help the poor, the Shangluo Prefecture Administrative Office has, through 200 help-the-poor economic cooperatives, issued a small-amount of loans to 140,000 farmer households, with the rate of loans issued covering 600,000 people. Through readjusting the agricultural structure, it has closed 75 percent of barren hillsides to facilitate tree-planting on 859,000 mu of land. In the reform of State-owned enterprises (SOEs), it has revived many small SOEs. For example, a smeltery in the original prefecture was a product of the planned economy, it had been operating at full-amount liabilities, the factory suffered long-term losses though there was no need to worry about the sales of its products. Although the leading bodies had been reshuffled several times, it saw no improvement, by 1998, it had incurred a deficit totaling more than 44 million yuan. Early last year, the prefectural Party committee and the Administrative Office conducted thorough reform of it, it was then merged by the Shaanxi Zinc Co. Ltd. Formed with funds from the Shaanxi provincial Trust and Investment Corporation and six other enterprises. The newly re-established smeltery conducted technological renovation, expanded its scale and earned 3 million yuan in profits the same year, stepping into a virtuous cycle.

While conducting drastic reform of State-owned enterprises, Shangluo Prefecture adopted a series of preferential policies, gave a free reign to the development of individual and private economies, as a result, the prefecture has gained a good momentum for the rapid development of individual and private economies, last year, the GDP of non-public economies accounted for over 35 percent of the prefecture's total, making them the new areas of economic growth in Shangluo Prefecture.