XINING -- China will invest 16 billion yuan ($2.6 billion) to protect Sanjiangyuan, the cradle of the Yangtze, Yellow and Lancang rivers in northwestern Qinghai province.

The second phase for the ecological protection and restoration of Sanjiangyuan was officially launched on Friday.

According to the protection plan, the restoration area will be expanded to 395,000 sq km, or 54.6 percent of the total area of Qinghai.

Although the first stage has brought remarkable improvements, the overall ecological degradation of the area has not been fundamentally curbed, said Du Ying, vice director of the National Development and Reform Commission.

The second phase will involve protecting the environment, improving people's livelihoods and achieving coordinated economic, social and cultural development, said Li Xiaonan, a Qinghai official for the Sanjiangyuan project.

With an average altitude of 4,000 meters, the Sanjiangyuan region has long been a paradise for herders, rare wild animals such as the Tibetan antelope and medicinal herbs like the Tibetan snow lotus.

However, global warming and human activities since the end of last century have led to a deteriorating natural environment, shrinking wetlands, decreasing water levels in lakes and water flow in the headwaters, and increasing desertification.

With significant protection efforts since 2000, the forest coverage rate in Sanjiangyuan increased from 3.2 percent in 2004 to 4.8 percent in 2012.

The new plan aims to increase the rate to 5.5 percent by 2020.