New industries

Wang Zhong said Gejiu will focus on developing the pharmaceutical industry, including Yunnan Yunhe Pharmaceuticals Inc, while supporting a few major enterprises in the suburbs. Two of the city's pharmaceutical companies have jointly been awarded more than 30 production certificates for traditional Chinese medicines.

The pharmaceutical industry is scheduled to play an important role in Gejiu's economic transformation.

As part of an economic transformation plan approved in 2010, the city will direct funds from the central and provincial governments to the biopharmaceutical and tin culture industries, a move that should boost employment and tourism, said Wang Yongchang.

"Gejiu has a tradition of technical innovation and marketing in the pharmaceutical industry. In addition, the city is also close to Laos and Cambodia, where some of the raw materials we use originate," he said.

On nine new production lines, medicines were being automatically packed and loaded onto trucks. Duan Bo, assistant to the general manager of Yunnan Yunhe, said the company earned revenue of 540 million yuan in 2012 and paid 60 million yuan in tax. That's approximately three times the amount in 2007, thanks to government support in terms of land provision and the cultivation of new talent.

Yunnan Yunhe employs more than 400 locals, all of whom have received a college-level education, and the company encourages local farmers to produce the raw materials. In three townships, more than 500 hectares of land have been sown with trees that produce the raw material for dragon's blood capsules, a famous branded medicine in Yunnan, used primarily to reduce bruising. The company will expand the planted areas to about 10,000 hectares within five years, according to its schedule. A company news release estimates that the move will bring the farmers income of more than 5 million yuan.

"The average monthly salary for workers is about 2,500 yuan and that will rise as the company grows," said Duan. "More important, a stable job at the company might be the a good option for those who were laid off."

Duan said the planting will be mutually beneficial, because the company's raw material costs will be reduced and the farmers will be able to stay in their home area and earn a decent income.