Date
25 March 2017
Passengers wait to board the Qinghai-Tibet Railway at Lhasa station. The rail link is just one of many infrastructure projects that have been subsidized by Beijing. Photo: Bloomberg
Passengers wait to board the Qinghai-Tibet Railway at Lhasa station. The rail link is just one of many infrastructure projects that have been subsidized by Beijing. Photo: Bloomberg

Tibet economy booms, thanks to Beijing’s huge subsidies

Tibet’s economy has been posting double-digit growth and outperforming the rest of China thanks to huge subsidies from Beijing that have helped several infrastructure projects take off in the region.

For the past two decades, Tibet’s annual growth has averaged 12.4 percent, compared with a national average of about 10 percent and Beijing’s 2015 target of 7 percent, Bloomberg News noted.

Since China annexed Tibet in 1951 and its religious and political leader, the Dalai Lama, fled into exile in India, the central government has pumped in more than 648 billion yuan (US$100 billion) into the region, according to the report.

The subsidies have funded massive transportation and power projects, including a 156-mile-long rail link from Tibet’s capital, Lhasa, to Shigatse, the region’s second-largest city.

The rail link was completed last year at a cost of 13.3 billion yuan. In other projects, the Zangmu hydropower station, on the Yarlung Tsangpo River, became fully operational in October.

Andrew Fischer, a professor at the International Institute of Social Studies in The Hague, was quoted as saying that subsidies amount to 112 percent of Tibet’s economic output, which was 80.8 billion yuan in 2013.

The subsidies are “more than one would see in a highly aid-dependent African country”, the Tibet expert said.

There has been a huge influx of Han Chinese into the region seeking to set up businesses. Beijing’s policymakers have paired 18 provinces and cities in China with counties and towns in Tibet.

The Chinese counterparts have been ordered to build schools, set up businesses, and send officials to work in Tibet for stints of up to three years.

China’s biggest state enterprises, including Sinopec, China National Gold Group, and PetroChina, have also been instructed to invest in Tibet.

One side effect of Beijing’s subsidize-and-invest policy is that Tibet is now plagued by inefficient and money-losing state-owned enterprises, the report noted.

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