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To encourage more Chinese university graduates to work in remote and underdeveloped areas, from next year the government will assist needy students to repay loans they borrowed for their studies, according to the Chinese Ministry of Education (MOE).

The central government will help 5,000 poorer university students to repay their state-subsidized student loans if they agree to work in China's western regions and remote rural areas when they graduate in 2007, the MOE said on Wednesday.

Loan repayments will be waived for students of state-sponsored universities if they're willing to work in remote and undeveloped areas for at least three years, according to a Ministry of Education (MOE) regulation released in September which comes into effect in 2007.

State-subsidized loans are granted by the Industrial and Commercial Bank of China to students in full-time university study to cover tuition fees and living costs. Approximately 600,000 students will graduate from 115 state-sponsored universities next year and 95,000 of them have loans.

The Ministry reckons a total of 4.95 million students will graduate from higher learning institutions next year which is 820,000 more than this year. And 1.4 million of them -- 3 out of 10 -- won't be able to find jobs on graduation because of the tight employment market.

Most graduates tend to stay in big cities where they encounter great difficulties in finding suitable work. There are more vacancies in smaller cities and rural areas but graduates are less keen to go there.

The unbalanced geographic distribution of graduate employment is an issue that needs to be tackled, the MOE says. The government is adopting a series of policies to help students find jobs. One of them is designed to encourage students to work in grass-roots institutes and in rural western China.

(Xinhua News Agency December 8, 2006)