BEIJING, Aug. 12 -- An official from the Chinese Academy of Engineering said on last Sunday that China plans to set up a RMB-300 million to RMB-450 million fund to support the rare earth research and development in the country in five years, sources reported.

The fellow revealed over a conference that China will take the industrialization of rear earth-based functional materials as a national strategy during the "Twentieth Five-Year Program" period, which started from this year to 2015.

Since last year, Chinese government has been stepping out effort to unveil the relevant regulations on the rare earth industry in order to achieve the industrial integration and secure more pricing power on rare earth resources.

The rare earth resources are mainly used in high-tech sectors, including hybrid automobiles, missiles and mobile phones.

China owns half of the world's rare earth reserves. Large deposits are found in the Inner Mongolia Autonomous Region.