2. Industrial Development and Structural Change
(1) Primary Industry and Its Profitability
In 2008, the added value of Tibet's primary industry reached 6.051 billion yuan, making up 15.3 percent of the region's GDP. In the same year Tibet had a sown area of 170,200 ha for grain, and produced 950,000 tons of grain, exceeding 900,000 tons for the tenth year in a row. The grain output for each ha of farmland amounted to 5,581 kg, 3.1 times more than the 1,370 kg/ha in 1959. Data analyses [7] indicate that in 2008 Tibet had a grain output of 333 kg per capita, each person possessing nearly one kg per day, while before Tibet's democratic reform in 1959 its annual grain output was only 150 kg per capita and grain possession per capita was less than half a kg per day. These changes are shown in Fig. 4.
In 2008, Tibet had 24 million head of livestock, an increase of1.5 times over the 1959 figure of less than 10 million. In addition, the commercialization rate of Tibet's animal husbandry has markedly improved. A survey shows that before the democratic reform in 1959 the proportion of major kinds of livestock delivered to the slaughterhouse in Tibet was less than 10 percent. In 2008, the proportion of cattle, pigs and sheep delivered for sale was 19.8 percent, 57.2 percent and 30.8 percent respectively. In 2008, the output value of Tibet's livestock breeding amounted to 3.896 billion yuan, 5.1 times more than that in 1959. In 2008, Tibet's meat output was 242,700 tons, and the milk output 295,200 tons, an increase of more than two times the figures before the democratic reform in 1959. This data is shown in Fig. 5.
Modernization of agricultural production has been the major reason for the growing output of agricultural products. Before the democratic reform in Tibet in 1959, wooden plows were used for agricultural production, and yaks were used for threshing in rural areas. In some areas the slash-and-burn method of farming was still common. Since 1959, Tibet has made extensive efforts to carry out farmland capital construction and spread scientific ways of farming by building irrigation projects, improving soil and farming modes, promoting the use of new types of agricultural tools, and cultivating excellent seed varieties. Since 1990, comprehensive agricultural development projects and a series of infrastructure projects related to agriculture and animal husbandry have been carried out in the middle valleys of the "one river and its two tributaries"- the Yarlung Zangbo River, and the Lhasa and Nyangqu rivers.
In recent years, the central government and the local government of Tibet have regarded agriculture as the basis of the national economy, and a key industry, focusing government work on problems facing agriculture, rural areas and farmers, and increasing financial investment in the primary industry[8] by providing huge subsidies for things necessary for agricultural production such as excellent seeds, chemical fertilizers, agricultural machinery and diesel oil. The subsidies enable farmers in Tibet to purchase their materials for agricultural production at prices 30 to 50 percent lower on average than those in other areas of China. These measures for assisting agriculture have reduced farmers' burdens and spurred agricultural development. The supply of modern equipment related to agriculture and animal husbandry has been raised to a completely new level. In 2008, the total power of machinery for agriculture and animal husbandry reached 3.4 million kw, including 13,184 large and medium-sized agricultural tractors, 90,500 small and walking tractors, 2,684 combines, 22,605 threshing machines and 17,196 agricultural transport vehicles. Tibet's farming has basically achieved a transformation from "two oxen pulling a plow"[9] to modern farming, thus greatly improving the comprehensive agricultural production capabilities, the output rate of land, and labor productivity.
(2) Secondary Industry and Local Economy
Before the peaceful liberation of Tibet in 1951, industry in Tibet consisted of only a 125-kw small hydropower station built around 1931, a small mint and a small machinery factory. Owing to poor management and a shortage of auxiliary equipment, the hydropower station supplying electricity to a minority of senior officials and aristocrats had to close shortly after going into operation. At that time Tibet had only 120 people working in industry, with a negligible industrial scale and output.
Since the democratic reform in 1959, with the support of the central government, Tibet has begun to establish its own modern industrial enterprises, from scratch to a certain scale, later growing into a major force in the region's economic development. Currently, Tibet has set up a modern industrial system of over 20 sectors with distinctive local features, including energy, textiles, machinery, timber, mining, building materials, pharmaceuticals, printing, food processing, light industry and chemical industry.
Continual improvements in Tibet's industrial system strongly promote secondary industry and the region's economy. In 2008, the added value of Tibet's secondary industry reached 11.576 billion yuan, making up 29.2 percent of Tibet's GDP, in which industrial added value of Tibet totaled 2.968 billion yuan, accounting for 7.5 percent of Tibet's GDP. Tibet has formed a system consisting of new types of energy resources, with hydropower as the backbone, supplemented by other energy resources such as geothermal, wind and solar power. In 2008, Tibet generated 1.812 billion kwh of electricity, nearly eight times the 227 million kwh in 1984. Over the past two years, Tibet has had a total installed power capacity of over 600,000 kw, with nearly 2.1 million electricity consumers, by implementing the "Brightness Project," "Sending-electricity-to-villages Project" and a rural power network project. Electric power has become a reliable guarantee for people in Tibet to enjoy the benefits of modern civilization.
In 2008, Tibet produced 116,900 tons of chromium ore and greatly intensified the exploitation of ordinary building materials such as stone for the purpose of construction, with an annual output amounting to five million cu m and an output value exceeding 100 million yuan. In 2008, Tibet's building sector recorded 8.608 billion yuan in terms of added value, accounting for 21.7 percent of the region's GDP. With the growth of the construction sector, there are now more than 30,000 former farmers or herdsmen working in this sector in Tibet, with an increase of over 100 million yuan in revenue. In recent years, with the deepening reform of the housing system, real estate sector is gradually becoming a new growth point for the region's economy.
(3) Tertiary Industry and Its Contribution
Tertiary industry has become the largest industry in Tibet, with newly emerging sectors such as modern commerce, tourism, posts and telecommunications, catering, cultural entertainment and information technology developing rapidly. In 2008, the added value of tertiary industry in Tibet amounted to 21.964 billion yuan. More than half, or 55.5 percent of Tibet's GDP come from tertiary industry, easily making it top of the contributors of local GDP.
Before the peaceful liberation in 1951, Tibet had no roads in the real sense. Local haulage relied mainly on humans and animals. After peaceful liberation, the first large-scale project undertaken by the central government in Tibet was the construction of highways among mountains more than 3,000 m above sea level that linked Lhasa with Sichuan and Qinghai, two neighboring provinces. After that, more investment funds were poured into the region to construct highways linking Tibet with Xinjiang, Yunnan and Nepal. Currently, the Tibet Autonomous Region has 15 main highways and 375 branch roads.
By the end of 2008, almost all counties in Tibet are accessible by roads whose total length reached 51,300 km. Tibet now has a road network of five national highways, 15 main highways and 375 branch roads. Improvement has been made to the road network in rural areas, easing the bottleneck effect caused by poor transportation on the region's rural economic and social development, thus injecting vitality into the economy in urban and rural areas, and promoting balanced development between urban areas and farming and pastoral areas, as shown in Fig. 6.
In recent years, the completion and operation of the Qinghai-Tibet railway has greatly spurred growing demand for tourism, cars, housing, catering and entertainment. In 2008 Tibet's retail sales of consumer goods came to 12.908 billion yuan, up 15.2 percent over 2007. Of these, the retail sales of consumer goods in urban areas stood at 6.428 billion yuan, up 14 percent over 2007; the retail sales of consumer goods at the county level or below totaled 6.48 billion yuan, up 16.4 percent over 2007. Looking at particular sectors, the wholesale and retail trade in 2008 yielded 10.459 billion yuan, up 18.1 percent over 2007; the retail sales for the lodging and catering sector recorded 1.951 billion yuan, up 3.8 percent over 2007; and the retail sales of other sectors hit 498 million yuan, up 7.3 percent over 2007.
In the wholesale and retail sector above a designated size, retail sales of clothing, shoes, hats and textiles grew by 35.4 percent, that of petroleum products by 30.9 percent, that of gold, silver and jewelry by 20.4 percent, and that of food, beverages, tobacco and alcohol by 68 percent.
Posts and telecommunications have seen unprecedented growth. In 1959, Tibet had only 276 telephones, mostly located in large and medium-sized cities like Lhasa. The earnings of postal and telecommunications services then totaled only 990,000 yuan. Now, Tibet has formed an advanced communications network covering every part of the region with Lhasa as the center, providing services such as optical cable and satellite transmission, combining program controlled exchange, satellite communication, digital communication and mobile communication. Statistics show that over the past 20 years the business transactions of the postal and telecommunications services in Tibet have grown at an annual rate of 34.4 percent, reaching 4.173 billion yuan in 2008, up 35.1 percent over 2007. By the end of 2008, telephone (including mobile phone) subscribers in Tibet totaled 1.562 million, an increase of 117,000 subscribers over the previous year. Now in Tibet there are 55 telephones per 100 persons, with the rural telephone subscribers numbering almost 27,000 households. In addition, Tibet has over 800 Internet websites, providing services to about 200,000 netizens.
In 2008, the balance of deposits in both renminbi and foreign currencies in Tibet's financial institutions stood at 82.902 billion yuan, up 28.9 percent over 2007, with the savings of both urban and rural residents hitting 18.536 billion yuan, up 15.8 percent over the previous year. Also in 2008, the balance of loans in both renminbi and foreign currencies from financial institutions amounted to 21.932 billion yuan, up 13.3 percent over2007; cash receipts for the financial institutions totaled 79.532 billion yuan, up 3.8 percent over 2007; cash disbursements were 82.985 billion yuan, up 4.2 percent over the previous year; and the net cash injections amounted to 3.453 billion yuan, an increase of 407 million yuan over 2007.
Tourism is playing an increasingly important role in Tibet's tertiary industry. Though it has unique natural, cultural and tourism resources, Tibet developed its tourism sector very late. Before 1978, there was almost no tourism in Tibet. In 1980, there was only one hotel that could receive overseas tourists, with fewer than 100 beds. The reform and opening-up policy has helped Tibet open its long-closed doors to the outside world, enabling its tourism to gain a considerable expansion. It has greatly improved its tourist reception capabilities, with 93 tour agencies of various kinds, and 62 star-rated hotels. The total fixed assets of the region's tourism sector stand at 1.78 billion yuan, with 12,032 employees.
Since the completion and operation of the Qinghai-Tibet railway, Tibet's tourism has entered a period of rapid development. In 2008, 2,246,400 Chinese and foreign tourists visited Tibet, a figure bigger than the total number of tourists who went to Tibet between 1980 and 1997. Tourism revenue in 2008 reached 2.259 billion yuan, almost equaling the total revenue generated between 1980 and 2000. Tibet has now formed a tourism resources pattern, with Lhasa as the center, supplemented by Shigatse, Shannan and Nyingchi, and extending to Nagqu, Ngari and Qamdo (see Fig. 7).
At present, in addition to its contribution to the region's GDP and revenues from foreign exchange, Tibet's tourism plays an increasingly significant role in increasing employment and tax revenues, and raising the living standards of both urban and rural residents. Tourism has become a major channel to create job opportunities and increase people's incomes.
(4) Industrial Structure and Development Pattern
Tibet's industrial structure has been increasingly optimized, as the region's economic aggregate is expanding, with its industries developing at a rapid and coordinated speed. This can be seen in Fig. 8, which shows the proportion of the added value of primary, secondary and tertiary industries in the region's GDP and the ratio between the three industries in the three years of 1959, 1997 and 2008.In 1959, the proportion of Tibet's primary, secondary and tertiary industries in the region's GDP was 73.60 percent, 12.60 percent and 13.80 percent, respectively; the added value of primary industry accounted for over 70 percent of the GDP, indicating that Tibet was then a typical agricultural society. In 1997, the proportion of Tibet's primary, secondary and tertiary industries in the region's GDP was 37.80 percent, 21.90 percent and 40.30 percent, respectively; the added value of tertiary industry made up over 40 percent of the GDP, indicating that tertiary industry had become the region's largest type of industry. In 2008, the proportion of these three types of industries in the region's GDP was 15.30 percent, 29.20 percent and 55.50 percent, respectively; the added value of tertiary industry accounted for over 55 percent of the GDP, indicating that tertiary industry was playing a dominant role.
In 1959, the ratio of added value of Tibet's primary, secondary and tertiary industries was 1:0.17:0.19; primary industry being the largest industry proves that Tibet was a typical agricultural society. In 1984, the ratio of added value of the three types of industries was 1:0.44:0.71; the plunging ratio of the added value of primary industry in the GDP indicates that it was beginning to lose its domination in the region's economy. In 1997, the same ratio turned out to be 1:0.58:1.07; the added value of primary industry historically gave way to that of tertiary industry. In 2003, the ratio became 1:1.17:2.38; the added value of tertiary industry made up more than half of the region's GDP, and the added value of agriculture took the last place. Tibet's industrial structure was upgraded again, forming a pattern with tertiary industry as the largest, secondary industry taking the middle place and primary industry as the smallest one in light of their weight in the region's GDP. This pattern has since continued, indicating the soundness of regional economic development.
Thus, judged from either the proportion of the added value of the three types of industries, or the ratio between the three of them, Tibet's present economic structure has achieved a transformation from one mainly relying on the manufacturing sector, to one depending mainly on the service sector. An economic structure mainly supported by the service sector can help create more job opportunities, and will play an important role in preserving the region's ecological environment and traditional culture.
