ONCE one of the poorest regions in China, the desert on northwest China's Loess Plateau, Yulin, has been developed into a major energy and chemical industry base with the exploitation of coal, oil and natural gas.

It is dubbed "China's Kuwait."

Located in the northern area of Shaanxi Province, Yulin was a major part of the revolutionary base of the Communist Party of China during the 1930s and 1940s. Mao Zedong, Zhou Enlai and other CPC leaders fought in more than 30 villages for a year.

A total of 48 kinds of minerals have been found within the territory of the city, covering an area of 43,578 square kilometers. It is estimated that the resources buried under every square kilometer is worth 1 billion yuan (US$160 million).

The resources have changed lives. Unsubstantiated reports suggest that the number of billionaires in the city with a population of 3.35 million has exceeded 7,000.

The rich born in golden age

When 47-year-old Liu Jiancheng's mother died in 1983, his family could not afford a coffin. Liu had to drop out of middle school to work. He became a carpenter.

In mid-1980s, the exploration of coal resources started in the northern area of Shaanxi. China began to build Shenfu Coalfield in the region, which has the largest proven deposits in the country.

Liu went to Daliuta, located at the heart of the Shenfu Coalfield in 1990 to make office furniture for the branch of the Agricultural Bank of China.

He noticed new buildings in the bustling town of Daliuta. Liu then moved his furniture workshop to the town, and benefited from business with government departments and companies in the town.

After a period in Hohhot, capital of north China's Inner Mongolia Autonomous Region, Liu returned to Yulin to develop real estate.

Yulin began to construct an economic development zone in 1999, and the value of Liu's land shot up. It made him a billionaire.

Over the past decade, the city's gross domestic product surged more than 20 times to 229.2 billion yuan in 2011.

Feng Huaizhen speaks with a heavy accent of northern Shaanxi. "I'm just a farmer, a farmer seeing further than other farmers."

Feng, who can write few characters, became a billionaire by speculative buying and selling coal mines.

People used to look down on him. "You know my thoughts when I was in Beijing? A shepherd boy in a Rolls-Royce passing by Tian'anmen Square. That was me." The new upstarts, especially the coal mine bosses, are often denounced for their low quality. But Feng said many coal bosses in northern Shaanxi care about others. "When I help the poor, I feel happier than making a lot of money."

He is now honorary vice president of China Association of Poverty Alleviation & Development. Every year, he donates more than 10 million yuan to charity activities. A project of the association is to train village officials with a college education.

During the rapid economic development of Yulin, the gap between the rich and poor was widened. Enormous wealth has been concentrated in a small number of private entrepreneurs, while a large number of rural residents are still living in poverty. The annual income of more than 500,000 rural residents is below 2,000 yuan.

The late Chinese leader Deng Xiaoping said in 1980s: "Some areas and some people can get rich first, lead and help other regions and people, and gradually achieve common prosperity."

How to narrow the gap between the rich and poor and make the impoverished share the results of the economic growth has become a pressing issue for local governments. They have encouraged entrepreneurs to develop projects back in their hometowns, or take the positions of village heads to help the locals get rich together.

The total assets of Zhang Wentang's company have exceeded 1.16 billion yuan. After he was elected as the village head of his hometown, he decided to invest 300 million yuan to bring fundamental change to the poor village. Zhang helped renovate 200 hectares of farmland and build 13 water pump stations in the village. The average annual income of the villagers has risen from 2,000 yuan to more than 9,000 yuan.

Wealth beyond black

Coal mine boss Bai Haoting was reluctant to tell about his get-rich history. He only said, "as long as the coal market is good, making money is easy."

However, the price of coal dropped sharply in the first half of the year, as a result of the slowing domestic and world economy and production capacity surplus in raw materials and energy industries. Yulin's economy was hit seriously with over 100 coal enterprises ceasing production.

Bai said the era of making huge profits in the coal industry has ended.

Lu Zhiyuan, mayor of Yulin, said resources including coal, oil and natural gas are gifts bestowed by nature.

Dependence on resource development causes environmental deterioration, exhaustion of resources and lack of an engine for future economic growth. As a result, an overall, coordinated and sustainable development can hardly be achieved, Lu said.

"Transforming the economic development mode is for the long-term interests of the city," he said.

Wang Fei, president of the Sheep Leader Group, a garment company, has a life goal to create 1,000 millionaires and 100 multimillionaires.

Wang failed to finish high school after his parents died. He earned money by renting a billiard table and balls. He later set up a garment company in 1994.

The company's sales volume totalled 300 million yuan in 2011. Now the group has more than 100 shareholders, several hundred salespersons, and over 1,000 workers, collecting wool from several thousand families.

"My goal is to expand the assets of Sheep Leader to 10 billion yuan in the coming five years and to list it. At that time, our shareholders will be multimillionaires, and salespeople millionaires," he said.

Wang also entered the coal, real estate and chemical sectors but invested all the money he earned into the garment industry because the business is tangible.

In order to shift from solely depending on resources to diversified development, the Yulin government is drawing policies to encourage industries such as equipment making and textiles and garments under its five-year plan (2011-2015).

Hu Zhiqiang, the secretary of Yulin Municipal Committee of CPC, said: "We are exploring a scientific development road, which enables sustainable development for resources, industries, environment, and people."