The government of Lijiang, an ancient city and a World Cultural Heritage site in southwestern China's Yunnan Province, has threatened to impose hefty fines on polluters to protect the local environment.

Local companies face a maximum fine of one million yuan (about US$146,000) if they fail to meet annual targets of energy consumption and emission reduction, sources with the local environment protection bureau said.

The companies will lose tax rebates and other preferential policies, and are threatened to be shut down if they do not complete renovation in a stipulated two years' time, he said.

The bureau is keeping close eyes on heavy polluters in the city, including the cement, cigarettes and metallurgy factories, he added.

The ancient city of Lijiang, located on the northwestern tip of Yunnan, is famous for the ancient Naxi ethnic group's residential buildings constructed in the Ming Dynasty (1368-1644) and the Qing Dynasty (1644-1911).

The 800-year-old city, which was listed as World Cultural Heritage site in 1997, now receives four million tourists a year.

The city has recently won a UNESCO's 2007 Award of Merit for its efforts in conservation and restoring of ancient buildings.

(Xinhua News Agency October 22, 2007)