The General Office of the State Council, China's cabinet, has issued a notice pledging financial support to help farmers and the poultry industry get through the bird flu outbreak in the country.

"Local governments and relevant departments must ensure the compensation funds reach those farmers whose poultry were slaughtered to contain the spread of the avian influenza," said the notice.

All poultry within 3 kilometers around the sites infected with bird flu were killed and disposed of safely in China, where the emergency measures also include intensified mass culling and compulsory vaccination of all the poultry within 5 kilometers around the affected sites according to set standards.

The State Council and local governments have promised to compensate for each killed poultry to the farmers. Over 1.2 million fowls have been killed in China so far to contain the bird flu outbreak.

The notice said the central government has made "emergency arrangements" to expand the production of the flu vaccine.

The funds earmarked for the vaccination must be timely settled and allocated while the vaccine's quality should be maintained to the strict criteria and standards, according to the notice.

Meanwhile, poultry raising and processing enterprises will be exempt of their income taxes in 2004 and fowl processing enterprises will have their added value taxes refunded during the period of February 1 to July 31, according to the notice.

Upon approval by local province-level governments, those poultry raising and processing enterprises may also enjoy other preferential treatment such as reduction in or exemption from taxation on land use, housing and vehicle usage, said the notice.

The central government also urges banks to postpone withdrawal of due short-term loans from poultry raising and processing enterprises, pledging fiscal support to cover half of the interest on loan extension for a period of up to six months, according to the notice.

(Xinhua News Agency February 16, 2004)