China's Economy, Seen From 13,000 Feet

By Travis Altman

Is the Chinese economy headed for a crash?  Those who think so sometimes point to the tourism sector as a possible weak link.  They figure now the Olympics are over foreigners will be less motivated to come to China and spend money.  They may very well be right, but that doesn’t mean the travel industry is dead here.

This weekend I traveled to Shangri-La, a region located high in the western mountains near Tibet.  The area is about as far from China’s crowded coastal cities as you can get, and yet just like Beijing or Shanghai Shangri-La is in the middle of a building boom.  Here workers are doing much of the job by hand, working with brick, concrete and wood to build new hotels, temples and shops in the traditional Tibetan style, all of it meant for new visitors.  Some will come from the U.S. and Europe, but the vast majority will be Chinese citizens who now have the money and the political freedom to visit this once completely isolated area.

For perhaps the first time in its history, the region of Shangri-La is looking outward to the rest of the world, and the strategy seems to be working.  According to the local party secretary, the economy here has grown an average of 20% every year since 1995 when it was first opened up to tourists.  Even if that torrid pace slows down, it could be a blessing for the region, giving the local government a little breathing room to balance all the new commerce with the need to protect the natural beauty and cultural vibrance the area is known for.

Of course, all of this could come crashing down quickly.  Tensions between religious and political leaders go back a long time here and can be felt clearly to this day.  However, if the powder can be kept dry, a region that in some ways feels forgotten by time could help usher in a new era for China.