Xixia county, near the city of Nanyang, Henan province, recently came up with 3.3 million yuan ($520,000) in subsidies to get farmers to develop forests for industry, because it had to relocate 165,000 residents for China's South-North Water Diversion Project, which has left a large amount of land vacant.

In commenting on the changes, one walnut farmer in the nearby village of Huying, Hu Jianhua, said, "I really appreciate the local forestry department for giving me technical guidance in planting walnut trees and a 58,000 yuan subsidy. I’m quite confident about developing the walnut business."

Xixia has worked with the Chinese Academy of Forests and has asked experts to train farmers in planting techniques and to provide manuals on cultivation and management of bamboo, tea, walnut, honeysuckle and other plants. And it has established a site to provide farmers with practical information on forestry policies, or market supply and demand to help the ecology and economy and increase incomes.

Xu Hu, the deputy county head, notes that they have been successful in attracting several dozen enterprises which have put 850 million yuan into forestry development.