TAIYUAN, April 10 -- More and more Chinese coal mine operators are looking beyond mining, with some returning to their agricultural roots.
"After selling some of my mines, I started to invest in potato processing," said Zhang Bao, a former coal baron, now boss of Huajin Potato Company in Datong City, in north China's Shanxi Province.
Since 2011, Zhang has invested 130 million yuan (21 million U.S. dollars) in potato starch. His company processes around 140,000 tonnes of potatoes every year.
Zhang is just one example of a transformation in Shanxi. Data from the Statistics Bureau of the province shows that investors are more interested in farms than coal mines.
In 2013, fixed assets investments in primary industries in Shanxi, represented by agriculture, amounted to 70.5 billion yuan, a 92.6 percent increase year-on-year. This is a three-year high, far surpassing the 13 percent enjoyed by the secondary industries, where mining and manufacturing are included.
The recent economic downturn has caused wobbles among resource-based industries in the province. In 2008, the government started shutting down unqualified coal mines. Also, as the coal price continues to drop, investors have gradually withdrawn from the industry, and agriculture is filling the gap.
"Many coal mine owners used to be farmers," said Guo Weidong of Shanxi Academy of Social Sciences. "With the integration of coal resources, many of them are looking to farmland out of risk concerns."
A series of policies favorable to agriculture have helped the inflow of capital into the sector, guaranteeing agriculture security and improving farmers'income. This has made agriculture investment easier for coal mine operators, and agriculture in Shanxi is developing quickly.
"The coal mine owners have become modern agriculture trailblazers with their capital, technology and marketing skills," said Guo.
"In the next step, we plan to make the investment environment more friendly and develop modern agriculture even further," said Guo. "One thing is for sure: more mine owners will come back to the farm, and we can expect more vigorous development."
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