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Haier, China's largest maker of home appliances, saw its net profit up 20.6 percent last year thanks to the central government's initiative to subsidize purchases by rural residents.

The group's turnover increased 8 percent to 122 billion yuan ($17.8 billion) last year.

The achievement came from effective control of inventory levels as well as trade and bill receivables, said its CEO Zhang Ruimin.

The Qingdao-based Haier has taken lessons from the 1997 Asian financial crisis and is preparing to respond to crisis every day, Zhang said.

Sales in overseas markets rose 9.8 percent year on year.

Zhang said the key to the growth in China was the fast-growing rural market.

Haier is benefiting from the central government's subsidy scheme to spur domestic consumption that began its trial run in December 2007. The second round of the scheme began on Dec 1, 2008.

The scheme entitles each of the 180 million rural households to a 13 percent government rebate on purchase of one home appliance item. These include televisions, refrigerators, washing machines, mobile telephones, air conditioners, water heaters, computers and motorcycles.

Haier sold 1.2 million units of home appliances, generating revenue that made up 42 percent of the country's whole sales through the first round of the scheme.

It has 21,000 outlets in Chinese townships and 73,000 sales points in villages. Some 230,000 people have got jobs from Hai'er countryside strategy.