Beijing pledges to keep Tibet's economy afloat with investments

PUBLISHED : Wednesday, 25 February, 2009, 12:00am
UPDATED : Wednesday, 25 February, 2009, 12:00am

The central government has vowed to keep Tibet's economy afloat by making huge state investments, Xinhua reported ahead of the Tibetan New Year today.

With the sensitive anniversary of a failed uprising against communist rule 50 years ago approaching, Beijing is eager to cushion the restive region from the impact of the present economic turmoil.

The deputy director of the Tibetan branch of the National Statistics Bureau, Wu Jianhua, was quoted by Xinhua as saying the blow dealt to Tibet's economy would be limited because the regional economic growth was mainly driven by central investment.

The central government has promised 180 infrastructure projects, with a price tag of nearly 80 billion yuan (HK$90.8 billion), from 2006 to 2010 in Tibet.

These projects included the Qinghai-Tibet Railway extension line, the world's highest airport in Ngari, the region's fourth civilian airport, and drinking water, electricity and communications projects.

More than 93 per cent of the funding will come from the central budget.

'Nearly 30 billion yuan has been spent, and another 20 billion is to be spent this year,' Mr Wu told Xinhua.

Despite the assurance of state investment, Tibet's economic future looks gloomy.

Xu Jianchang, deputy director of the Tibet Regional Development and Reform Commission, said local consumption, mainly driven by tourism, was severely hurt by the March 14 riots in Lhasa last year. The local government still set a goal of 10-plus per cent economic growth this year, alongside other double-digit growth targets such as per capita net income for farmers and herders, budget revenue, fixed-asset investment and retail sales.

Ai Juntao, deputy director of the regional financial department, expressed concern that tourism in Tibet would continue to be affected as 'the number of European and American tourists will shrink due to the financial crisis', after suffering significantly in the wake of the riots.

In 2007, a total of 4.02 million tourists visited Tibet, bringing 4.85 billion yuan of revenue to the region.

Tourism revenue made up 14.2 per cent of Tibet's gross domestic product in 2007.

However, the number of tourists fell 44 per cent and tourism revenue fell 53 per cent last year.

The government in Tibet hopes to receive 3 million tourists this year. It was concerned that a protracted economic downturn in the aftermath of the riots might aggravate Tibetan people's discontent and result in more instability, observers said.

Infrastructure projects

The central government has promised 180 infrastructure projects from 2006 to 2010 in Tibet

The total cost, in yuan, is close to: 80b

The percentage of funding derived from the central budget exceeds: 93%