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About 1,000 factories producing dangerous chemicals or explosives face closure if they fail to obtain new licenses.

Plants in Guangdong Province will be ordered to shut down or suspend operations if they do not get work safety licenses by Friday.

Under a new scheme introduced by the State Administration of Work Safety, all factories nationwide producing chemicals or explosives must submit work safety reform plans to their local government and apply for renewed licenses by the end of the week.

According to statistics from the provincial government, 2,042 factories have handed in programs and applied for renewed licenses, with 840 approved as of June 19.

"We expect about 1,100 factories will eventually obtain licenses," Su Xiaojun, vice-director at the policy-making office of Guangdong Provincial Administration of Work Safety, told China Daily yesterday.

According to the new requirements, factories with a high risk of accidents must be at least 25 meters from residential buildings.

For factories with a low risk, the distance is 10 meters.

Some factory owners complain that more and more residential buildings have been built close to their factories over the past decade.

"When we built the factory at the beginning of 1990s, the site was isolated," said a factory owner surnamed Yin in Dongguan, an industrial city in the province.

He said that moving the factory to a more remote place would cost a lot of money, and hopes the government would be able to provide some financial assistance.

Since some factories are Hong Kong-invested, Hong Kong officials and entrepreneurs have asked Guangdong authorities to postpone the deadline for half a year, giving them more time to cope with the new policy, said Kwo Tsen-hwa, director of the Federation of Hong Kong Industry.

"The national policy is not directed against Hong Kong factories," said Su Xiaojun. "And the deadline will not be extended because the government has demanded strict enforcement."

Su said the government had already pushed back the deadline from December last year to June.

Hong Kong-based newspaper Wen Wei Po said more than 100 Hong Kong-invested factories would fail to meet the new rules and be closed down.

Su said some cities have declared they would like to be relocation sites for the affected factories, and could provide them with favorable investment policies.

The cities include Shaoguan and Qingyuan in northern Guangdong, and Huizhou, Zhongshan and Zhuhai in the Pearl River Delta.

The central government will decide what compensation to provide for the relocating and upgrading of factories, said Su.

More than 16,000 people were evacuated after a chemical blaze in a warehouse in Guangzhou in May.

The event forced the local administration of work safety to enact a new policy ordering all chemical factories and warehouses to move out Guangzhou's downtown before 2009.

(China Daily June 27, 2006)