V. Promoting Technological Advancement and Industrial Upgrading

China makes it a priority to enhance the level of scientific development and utilization of rare earth resources. The state strives to create a favorable policy environment for expediting the technological advancement and upgrading of the rare earth industry, overcoming resource and environmental bottlenecks and providing technological support for the sustainable development of rare earth industry.

The state encourages technological innovation in the rare earth industry. The Outline of the National Program for Long- and Medium-term Scientific and Technological Development (2006-2020) lists rare earth technologies as a key field of research and development to get state support. The state supports basic studies and studies on frontier technologies related to rare earths, as well as the research and development, application and spread of critical industrial technologies, and promotes the establishment of an enterprise-centered, market-oriented technological innovation system that combines the efforts of enterprises, universities and research institutes. China actively develops environmental-friendly, advanced and appropriate rare earth exploitation technologies, highly efficient mining technologies suited to complex geological conditions, and comprehensive recovery technologies for paragenetic and associated mineral resources, in order to raise the recovery rates and cyclical utilization levels of the resources. The country makes vigorous efforts in organizing research and development of advanced technologies for low-carbon and low-salt discharge, manufacturing of ultra-pure products, membrane separation, recovery and utilization of associated thorium resources, recovery and treatment of fluorine and sulfur in tail gas, recycling of chemical raw materials, and automatic production control, to realize the efficient and clean smelting and separation of rare earth metals. The government guides rare earth production and application enterprises, scientific research institutes and institutions of higher learning to develop deep processing and new material application technologies. It works hard to foster science and technology personnel, strengthen the protection of intellectual property rights, and establish technological standards, in order to create favorable conditions for the development of rare earth technologies.

Over the past few years, China has accelerated the technological transformation of rare earth enterprises, encouraged the use of efficient and green technologies for mining and ore dressing, such as in-situ leaching, and advanced equipment to renovate rare earth mines, enhanced their performance in comprehensive resource utilization, ecological restoration, environmental protection and safe production. It has built and improved facilities for the storage and treatment of tailings to protect and make better use of tailing resources. The state also encourages the transformation of existing production lines of rare earth smelting and separation by using advanced equipment and technologies, such as separation without using ammonia, and fuzzy simultaneous extraction technology, in order to reduce the consumption of chemical materials and discharge of the "three wastes," namely, waste gas, waste water and waste residues. New technologies and equipment featuring low discharge and low energy consumption are adopted to renovate rare earth smelting enterprises, to increase production efficiency, improve product quality and lower energy and material consumption. The state is also accelerating the elimination of ammonia saponification extraction, chloride electrolysis, hydrometallurgical synthesis of rare earth fluoride, and other obsolete processes and capacities. It encourages enterprises to combine technological transformation with merger and reorganization and elimination of outdated capacities, in order to get backward rare earth enterprises to close down, suspend operations, merge with others or change their lines of production.

Readjusting and optimizing industrial structure is a crucial step in promoting the sustained and healthy development of the rare earth industry. The Chinese government exercises strict control over the total volume of rare earth smelting and separation, and will not approve any new rare earth smelting and separation projects except for those state-sanctioned projects of merger and reorganization and for distribution optimum. Existing rare earth smelting and separation projects are prohibited from expanding their scale of production. The state resolutely halts the construction of projects that are undertaken in violation of relevant regulations, and will punish, in accordance with the law, departments and individuals responsible for giving approval beyond their authority and those responsible for building the projects in violation of relevant regulations. China adjusts the structure of processed rare earth products, curtails the excessive consumption of rare earth resources by low-end products, and reduces the output of low-grade processed products that require high rare earth consumption. It aims to follow the international scientific and technological and overall industrial development trend and encourage the growth of high-tech rare earth application industries with high added value. In addition, the state expedites the development of high-performance rare earth materials and devices, including magnetic, luminescent, hydrogen-storage, and catalytic materials, and encourages the application of rare earth materials in the fields of information, new energy, energy conservation, environmental protection and health care. The state encourages enterprises to strengthen innovation in management, establish the modern enterprise system, and accelerate industrial upgrading, in order to transform them into modern enterprises that save resources, protect the environment, follow the path of intensive development and actively fulfill their social responsibilities.