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World Tibet Network News Thursday, October 3, 1996

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6. Stocks stir capitalism in Tibet (Reuter)

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By Jane Macartney

LHASA, China, Oct 3 (Reuter) - After centuries of medieval barter trade,
some Tibetans believe they have found a way to get rich quick -- playing
the stock market.

A satellite dish in the shadow of the Potala Palace that dominates the
Tibetan capital, Lhasa, feeds speculators with the latest fluctuations in
prices on China's two exchanges in Shenzhen and Shanghai.

The Tibet Stocks Business Centre was set up in January 1994 under the
auspices of the Tibet Investment and Trust Corporation to provide a site
where investors could watch the markets and make their trades.

In the streets of Lhasa, nomad pilgrims from Tibet's Himalayan plateau
prostrate themselves in devotion around the holy city and in front of its
most sacred shrine the Jokhang temple, far removed from the frenzied
worship of mammon inside the square, concrete stock trading centre.

"I thought it would take several years before we could attract any real
interest," Chen Ciduan, president of the investment corporation, said in a
reference to the undeveloped and almost medieval economy of one of China's
most backward and rural regions.

"But we had to double our space last year and we are already overcrowded
and are making plans for another expansion already," he said in an
interview.

In the trading centre, ethnic Tibetans and Han Chinese crowd together,
their eyes anxiously fixed on the computerised trading boards at either end
of the long room to monitor fluctuations in prices of Shanghai and Shenzhen
counters.

Interest has been intense.

The trading centre has 4,000 registered shareholders compared with just 100
when it opened, Chen said.

"At first, the idea was very strange to a lot of people, but after two
years understanding has become quite widespread," Chen said.

Turnover in 1994 was 16 million yuan ($1.92 million) and this soared by
about 27 percent to 21.4 million yuan ($2.57 million) in 1995, Chen said.

In the first eight months of this year, the value of trading totalled 37.4
million yuan ($4.5 million), or close to the total for the first two years,
and is expected to exceed 40 million yuan ($4.8 million) for the whole
year, he said.

While Tibetans may still be struggling to grasp the principles of market
economics, they have been bewitched by the possibility of making money --
and many have done well.

The trading centre opened after China's fledgling stock markets had peaked
and slumped, enabling Tibet's investors to buy at the lows, Chen said.

In addition, a time difference in the trading centre that lies more than
2,000 km (1,200 miles) west of Shanghai means that the lunch-hour of most
punters coincides exactly with the afternoon trading session.

"This is a rest time in Tibet so people have the time to come in," Chen said.

One of the biggest investors is a Tibetan businessman based in Chamdo
prefecture, a region renowned for its merchant warriors. Three investors
have each invested more than one million yuan ($120,000).

"These are big investors by Tibet standards," Chen said.

"Interest rates are falling and it looks as if there are more profits to be
made in the stock market," said 28-year-old Wang Xiaomei, whose father is
Han Chinese and mother Tibetan, as she watched intently at price movements
on the Shenzhen board.

"There is a risk, of course, but with macro-economic improvements I see a
bright future for stocks," said Wang, who has invested 12,000 yuan ($1,445)
in a region where the average annual urban income is just over 1,100 yuan
($132).

Chen insists the establishment of the trading centre will help to develop
Tibet's economy. He said the existence of the centre had nurtured the
listing in Shanghai of two Tibetan companies, Tibet Shendi Corp and Tibet
Pearl Co., with a third, Jinzhu trading house, in the pipeline and due to
issue shares in early October. No stocks are listed in Lhasa.

The stock trading centre plans to promote the listing of two more
Tibet-based state-owned firms next year, Chen said, but declined to
identify the companies.

At least one of the firms may be listed on the Shenzhen market to inject a
balance after the first three issues went to Shanghai. "Shenzhen officials
have complained," Chen said.

"I really want to buy Tibetan company stocks, but there is a lot of
competition," said Tibetan punter Dowa Cering. "I hope I'll be able to buy
some of Jinzhu's shares when it's listed next month."

Tibet enjoys preferential tax and loan policies that separate the vast and
sparsely populated region from a credit squeeze in the rest of China, and
Chen said listings would prove another valuable means for firms to raise
funds.

"This is a very good road for us," he said.

The region has no plans yet to try for an ambitious listing of a foreign
currency B-share company but is delighted with overall progress so far.

"I never expected that Tibet would have any listed companies for many years
and at first we couldn't find any firms that wanted to list," Chen said.
"But now they come begging to us."

The centre still has a long way to go to catch up with the rest of China.
"On some days, turnover is just a few yuan," Chen said.

One person appears assured of a profit. The man who runs the bicycle park
in front of the centre charges 0.20 yuan a time, or 0.40 yuan a day for the
two trading sessions. He earns about 20,000 yuan ($2,400) a year.

($1 - 8.3 yuan)

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Articles in this Issue:

1. Peking's poison fails to touch Tibetan hearts (Independent)
2. This document damns China over Tibet (Guardian)
3. Microsoft - Issued instructions on removing offensive Chinese slogans (WSJ)
4. Educational plans for Tibet slammed (UPI)
5. Tibet to establish schools in every town -report (Reuter)
6. Stocks stir capitalism in Tibet (Reuter)
7. Tibet Jinzhu to raise 76.2 mln yuan from issue (Reuter)

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