Yantai officials are eyeing emerging industries to improve the coastal city's competitiveness, according to a local senior leader.

"Emerging industries are the key to Yantai's future development," said Sun Yongchun, Party chief of the city.

He added that the industries, including new energy, new materials, biology and marine engineering, are essential to achieving an annual gross domestic product of 400 billion yuan this year, double that of five years ago.

During the first eight months of 2010, the output value of emerging industries' reached 323.98 billion yuan, rising 21.85 percent from the same period of last year and accounting for 43.5 percent of Yantai's total output value.

According to a new development plan announced by the city government in May, annual output value of emerging industries is expected to reach 500 billion yuan by 2015.

Officials hope that within the next five years, Yantai will become Shandong's flagship base for new energies, biomedicines and marine technologies.

To achieve this vision, authorities are developing a marine economic zone.

As part of the initiative, construction of China's biggest man-made island group is underway in the city's Longkou Port.

The project will create seven islands covering 35.2 square kilometers.

Scheduled for completion in 2015, the area will become a manufacturing zone for marine equipment, green energy, new materials, marine biology and pharmaceuticals.

"Yantai is on its way to hosting a new generation of internationally competitive corporations," said Wang Shiliang, director of Yantai Development and Reform Commission.

Yantai Wanhua Group is Asia's largest maker of MDI, a chemical used in synthetic fibers and leather.

The company is expected to become one of the world's top three MDI producers following a 13.2 billion yuan integration project. Construction began in January of this year.

Upon completion, the group's annual capacity will reach 1.4 million tons. Current annual MDI production is around 500,000 tons.

Luye Pharma, based in Yantai, boasts 40 patented products - all with self-owned intellectual property rights.

Around 80 percent of the company's sales income comes from patented products and technologies.

The enterprise recently began construction on a 500 million yuan Luye international pharmaceutical industrial park. It is projected to garner an annual sales revenue of 2 billion yuan when complete.