Province Introduction of China: Qinghai

Key Information 
























Introduction
Qinghai is located in Northwestern China on the Qinghai-Tibet Plateau. The Yellow River originates in the middle of the province, while the Yangtze and Mekong have their headwaters in the southern part. More than 42% of the population in Qinghai is Tibetan, Hui, Tu, Salar, Mongol or of another ethnicity.
 
Qinghai is rich in cultural history. It is the source of the Chinese Kunlun legend that was passed along throughout country before finally blending into mainstream Chinese culture. The province is attractive not only for its beautiful scenery but also for its colorful local customs.  

Economic overview
In recent years, Qinghai has enjoyed a rapid growth although it is one of the poorest provinces in China. In 2006, the province’s GDP reached RMB 64.1 billion, increasing by 12.2%. The GDP per capita was at RMB 11753, a rise of 11.3% over 2005.  
 
Industry leads the economy with a 51.60% contribution to the GDP, while the service sector follows relatively close behind with 37.60% of GDP contribution. Agriculture brings up the rear with 10.80% of the GDP. The annual value-add of the agriculture, industry, and service sectors were RMB 6.9 billion (an increase of 3.5% over 2005), RMB 33.1 billion (up 15.7% over the last year) and RMB 24.1 billion (an increase of 10.5% over 2005) respectively. 
   
In 2006, fixed asset investment in the province kept a moderate growth. The total fixed asset investment amounted to RMB 41.9 billion, up 14.3% over 2005. The five industries with the highest amount of fixed asset investments were in the areas of production and supply of electricity, gas and water, manufacturing, transport, storage and post, mining, and real estate.
  
















 
The province’s retail sales of consumer goods rose by 12.2% to RMB18 billion in 2006 and annual per capita disposal income of urban households was RMB 9000 - an increase of 11.7% from 2005. Major consumer markets located in Xining account for 67% of Qinghai’s total retail sales.

  

 





The expenditure pattern of Qinghai’s consumers has undergone structural changes over the last few decades. The consumption trend is slowly moving away from food and towards services. In 2006, household appliances recorded the fastest growth with a growth rate of 43.6% in terms of sales value, reaching RMB 290 million.   
 
Agriculture
Qinghai is an important livestock-breeding center in China. Its livestock includes sheep, yaks and horses. Qinghai produces large quantities of meat, sheep wool, leather and sausage casings for other parts of the country. In 2006, total meat production was 271,700 tons, up 5.5% over 2005. Within this figure, mutton production amounted to 95,700 tons, up 4.5% over 2005, and wool production totaled 17,700 tons, approximately the same amount as the previous year. Qinghai is also an important producer of medicinal materials such as caterpillar fungus, antlers, musk and rhubarb. The province grows spring wheat, highland barley, broad beans, potatoes and rapeseed. In 2006, acreage of special crops (such as potatoes) stood at 80,100 hectares and total production was 309,000 tons, a fall of 4.8% from the previous year. 
   
Industry
Qinghai is rich in resources such as hydropower, lead zinc, minerals, saline and petroleum and gas. The natural resources have had a great influence in shaping the province’s industry structure, as the pillar industries depend largely on these resources to develop.The four pillar industries in the province include the petroleum and natural gas industries, hydropower generating industry, nonferrous metal industry and saline chemical industry. In 2006, the total industrial added-value reached RMB 14.2 billion, up 17.7% from 2005, contributing to nearly 83% of the total added value of industrial output. 





  

   
 
Services
Qinghai has 408 scenic spots that are huge tourist attractions. Examples of these scenic spots include Qinghai Lake, Mount Sun&Moon, Longyang Gorge, and Gold and Silver Meadow. Together, they account for the growing tourist industry in Qinghai.  

  

 



The Qinghai-Tibet Railway is the world’s highest railway line and it weaves between Xining and Lhasa. The railway has a favorable impact on the local logistics industry and sightseeing. The operation of the Qinghai-Tibet railway in 2007 helped boost goods exchanges between the secluded Qinghai-Tibet plateau and other parts of China. 
 
Foreign Trade and Foreign Investment
In 2006, the province’s imports and exports amounted to US$0.6 billion, up 57.7% over 2005. Within this figure, exports reached US$0.5 billion, up 65.3% over 2005. Major export items included aluminum and rolled aluminum, silicon, yarn, woolen fiber and carpets. Major export markets included Japan, Hong Kong and the U.S.Imports reached US$0.1 billion in 2006, up 30.4% from 2005. Major import products were aluminum oxide, semi conductors, parts for auto data processing equipment, motor vehicles and chassis. Major sources of imports were Australia, India and Bosnia. In 2006, the province had an actual utilized FDI of US$0.3 billion, an increase of 3.4% from the previous year. Foreign investments in Qinghai were mainly channeled into the manufacturing industries, accounting for 65.5% of the total FDI (see Figure 12.7.2.). Hong Kong was an important source of FDI in the province, accounting for 28.4% of the province’s contracted FDI in 2006.  
 














   
















 
Major Development Zones
The major development zone in the province is the Xining Economical and Technological Development Zone (XETDZ). The zone was approved as a state-level development zone in July 2000. It has a total area of 12.79 sq km and is 5 kilometers away from downtown.
XETDZ gives priority to export-oriented industrial projects and projects utilizing foreign capital. The zone focuses on the development industries based on local merits, and these include chemicals based on salt lake resources, nonferrous metals, petroleum and natural gas processing, special medicine, foods, and bio-chemicals using local plateau animals and plants. In 2007, there were 100 investment enterprises with a total fixed asset investment of RMB 3 billion. Industrial output value in that year reached RMB 4.5 billion. 
   
Education
The education scene in Qinghai lags behind that of other provinces, although it is slowly improving. The province strives to wipe out illiteracy and emphasizes a 9-year compulsory education. As a result, in 2006, the coverage rate of compulsory education reached 86.8%, up 3.8% from 2005. 11,900 students also enrolled at Qinghai’s eight universities in 2006, an increase of 1.7% from 2005.  

Major Areas in Qinghai
There are a total of 8 administrative areas in Qinghai. Table 12.7.5 shows the GDP, land area and population of each of the areas.   
 

 










As illustrated in the table, Xining has the largest economic growth among all the areas in Qinghai. The following section gives an overview of the city of Xining.   
   
Xining



















 
Introduction
Xining is the capital of Qinghai province. It is located on the eastern edge of the Qinghai-Tibet Plateau and the upper reaches of the Huangshui River. It was the famous Silk Road’s most common crossing channel. Until now, it is still the only road by which to enter the hinterland of the Qinghai-Tibet Plateau.Xining is a multinational and multi-religious city. It plays home to 36 ethnicities including the Hans, Huis, Tus, Tibetans, Mongolians, Manchus and Salars. The population in Xining constitutes 25% of the total population of Qingdao.
 
Investment Climate
Xining has rich surface and underground resources with 10 kinds of key mineral resources such as coal, iron and copper. In addition, quartzite, asbestos, wild sulfur, kainite, lithium and iodine reserves here are the largest in the whole of China. After half a century, the city has developed its mechanism, light textile, metallurgy and food industries, with preponderant industrial products consisting of numerical controlled machine tools, siliceous iron, measure and blade tools, Tibetan blankets and Tibetan medicine. In 2006, the total industrial added-value reached RMB 11.0 billion, up 25.5% from 2005.
 
Foreign Trade and Foreign Investment
The volume of total imports and exports reached US$0.5 billion in 2006, an increase of 58.6% from the previous year.Xining has now established sister-city relationships with Korea, Japan and Russia. In 2006, the contractual foreign capital and actual utilized FDI amounted to US$0.5 billion and US$0.3 billion respectively.
 
Important Travel Information
Xining Caojiabao Airport is 27km from the city and the time taken to travel to major Chinese cities are as follows:

- Beijing
- Shanghai
- Chongqing
- Guangzhou  2 hours 15 mins
4 hours
2 hours 25 mins
3hours