The Ministry of Information Industry has reported that, with government efforts to establish a service fund on telecom development, China is expected to link all households by telephone, including its vast rural areas, by 2020.

By July of 2004, 90% of Chinese villages have been connected by telephones, and the connection ratio will shoot up to 95% next year, according to latest statistics released by the ministry. The government's plan is aimed at providing basic telecommunications services to all at affordable prices.

In the first seven months of this year, 68.071 million households added telephones, with 32.741 million adding fixed lines and 35.33 million adding cell phones.

However, the ministry said that telecom development remains seriously imbalanced between the country's coastal areas, where 77% of households own one fixed line telephone, and the hinterland, where only 40% of families have one.