Tibet's Economy Depends on Beijing

As reported on National Public Radio (Morning Edition) , Sept. 20, 2006

By Anthony Kuhn

China is one of the world's fastest-growing economies, but Tibet remains one of its poorest spots. Beijing pumps billions of dollars into Tibet each year, an infusion that's partly intended to stabilize the Himalayan region.

Tibetans and ethnic majority Han Chinese are constructing a dam on the Lhasa River, which has nurtured Tibetan civilization for centuries.

Once its turbines start spinning later this year, the dam will provide electricity to much of central Tibet, including the capital Lhasa. It's part of the roughly $2.5 billion that Beijing pumps into Tibet each year, mostly in the form of infrastructure projects.

The dam is supposed to benefit residents downstream, including 60-year-old farmer Gesang Quzhen.

"When I have some time to myself," she says, "I often reflect on how life has changed. In the past, we worked for others without pay. Now we farm our own land and we pay no taxes on our shop. As a young girl. I could see how hard my parents worked."

Quzhen was still young when the Chinese government took control of Tibet in 1951 and ended its feudal system. Quzhen's parents were "chabas," landless serfs who worked on a feudal lord's manor.

Today, Quzhen makes $2,500 a year from her roadside shop, and another $350 from her one-acre plot of barley and potatoes.

She says despite all the government construction over the past decades, most of what she's achieved in life has been by her own hand.

"The government has helped us build houses, and we can seek them out if we need assistance," Quzhen says. "But as for us, we've worked very hard, so we haven't needed much help from the government."

Tibet as a whole is not so self-sufficient. Herdsmen and farmers like Quzhen account for 80 percent of Tibet's 2.7 million inhabitants. Yet they produce less than 20 percent of the region's economic output. Tibet has the lowest economic output of any region in China. And a million residents in Tibet are still below the poverty line of $150 in annual income.

China's critics and Tibetan exiles blame Tibet's poverty on Beijing for stripping Tibet of its resources and neglecting its people's welfare.

Zhang Younian, the deputy director of Tibet's main economic planning agency, rejects such accusations.

He says Beijing exempts Tibet from all taxation and provides 90 percent of Tibet's government expenditures. "So there's no question of Beijing money out of Tibet," Zhang says. "Given our current economic circumstances, there's not much money to take out."

Zhang adds that China strictly controls the extraction of Tibet's rich mineral resources.

It's no secret that Beijing's spending in Tibet is partly intended to stabilize its border regions. Lhasa-based economist Wang Taifu points out that it's been this way for centuries, and remains the case today.

"If the central government did not make huge investments in its border regions, the income gap between these regions and the coastal areas would become too big, and Beijing would have no way to ensure peace and stability," Wang says.