The sporadic terrorist attacks haunting the Xinjiang Uyghur Autonomous Region have not only strained people's nerves, but also hit the local economy hard, devastating tourism, inbound investment and tertiary industries. For the first time in two decades, visitor numbers declined this year as investor confidence has also been shaken, with many hesitant about whether to invest in Xinjiang. Local authorities and the public are now scrambling to find ways to bring the economy back on track and ensure social stability.

A cloth vendor waits for customers in a bazaar in Kashgar, Xinjiang Uyghur Autonomous Region. Photo: Cui Meng/GT

Bi Cheng (pseudonym), an official from the Party Committee of the Xinjiang Uyghur Autonomous Region, vigorously shook hands with Zhang Yishuai, a teacher from the Beijing No.55 Middle School, expressing his gratitude for Zhang's visit to Xinjiang.

Zhang was visiting at a critical time. It was in August; just days after a terrorist attack in Shache county killed 37 civilians and injured 94.

 "Thanks a lot for visiting us in Xinjiang," Bi said, excitedly.

  Bi's excitement wasn't feigned. Due to a series of violent attacks in Xinjiang, the local tourism industry had shrunk dramatically, hitting its worst point in the past two decades.

 "In the first half of this year, the tourism industry in Xinjiang declined for the first time in the past two decades," Ma Rui, spokesman and deputy inspector of the Xinjiang Tourism Bureau, told the Southern Weekly.

 Zhong Liangyou, a local guide who has been in the industry for 12 years, echoed this. He said the tourism situation this year is no better than the situation after 2009's July 5 riot in Urumqi, which left 197 dead.

The industry picked up again in 2010, with its tourist population maintaining a year-on-year growth of 20 percent, official statistics from the local tourism administration showed. The turning point happened in 2013 when growth slowed down to 7 percent, and eventually, in the first half of this year, the growth fell below zero.

Tourism is not the only industry being affected by the tense situation in Xinjiang.

According to a Southern Weekly report in August, the unpredictable violence has had a considerable negative influence on the local economy as a whole, affecting sectors ranging from tourism, investment from other provinces, and other tertiary industries.

Xinjiang's GDP growth slowed down in the second quarter of this year, a significant slowdown compared with the rapid growth in the past years since 2010, official statistics from Xinjiang Development and Reform Commission showed.

Zhang Chunlin, director of the Xinjiang Development and Reform Commission, said the economic decline was attributable to the unstable situation caused by the violent attacks. Zhang also said it may have a negative influence on the confidence of investors.

"I have to admit that it has certainly influenced the confidence of the investors, but we have to understand that the influence is temporary and it won't have a huge impact in the long run," Zhang said, trying to dispel fears.

Tourists visit Kumutage Desert in northern Xinjiang. Photo: CFP

Strike on tourism



Under ordinary circumstances, summer is the high season for Xinjiang's tourism industry.

In past years, it was difficult to book a room in local chain hotels, but this year there were plenty of vacancies, sparking complaints from hotel owners. At least five hotels in Kashgar interviewed by the Global Times said there had been a decrease in visitors of at least 60 percent.

Where once the old streets of Kashgar were visited by Chinese and foreign tourists, in recent weeks there have been hardly any visitors.

Several vendors in Kashgar's big bazaar complained about the bad business environment. "It used to be filled with visitors, but now we have to rely on local people, who don't spend so much, to maintain the business," said a Uyghur owner of a clothing shop who asked not to be named.

Zheng Sui, general manager of the Xinjiang International Travel Agency affiliated with the China Youth Travel Service, said increasing numbers of Xinjiang locals visited other places while fewer non-local tourists came to Xinjiang in the first half of the year.

"The number of non-local tourists received by our agency declined at least 40 percent, which dramatically affected our overall profit," said Zheng, whose company occupies the largest share of Xinjiang tourism market.

Tour guide Zhong Youliang attributed the decline in the number of visitors to the attack on July 28 in Shache county, Kashgar, that left 37 civilians dead and 94 injured.

It was the fourth violent incident to occur in Xinjiang this year. Sporadic violent attacks have been seen in regions like Kashgar and Hotan, and are straining people's nerves.

"The tourism industry in Xinjiang was slightly better in July, but all of a sudden, the number of tourists dropped drastically in August after the attack in Shache," Zhong said.

Official statistics from the local tourism administration recording visitors to the world-famous Kanas Lake scenic area supported Zhong's speculation. The number of visitors in July picked up a little bit on a year-on-year basis, while in the first half of August, the number of tourists dropped at least 14.7 percent, and the total number of visitors to Xinjiang in the first half of August reached 77,000.

"Each time there has a violent attack, a lot of visitors began to doubt whether they would be safe in Xinjiang if they paid a visit. Plus, the widespread rumors triggered by violent attacks have had a very bad influence among people, making it difficult to reverse their opinions about Xinjiang in a short time," spokesman of Xinjiang tourism administration Ma Rui said.

However, Ma stressed that travelling in Xinjiang is safe. "None of the violent attacks targeted tourists, and there have been no violent attacks in the tourist areas. We have faith we can ensure the safety of tourists," Ma said.

A dozen local guides, including Zhong Liangyou, said it's normal for travel groups to cancel trips due to safety concerns. Even some backpackers said they would shorten their itineraries or choose a safer travel route.

Liang Mengrun, the owner of a hostel in Kashgar said he had accepted far fewer backpackers than the previous year. Last year, his hostel with 60 beds was filled to capacity, while this summer two-thirds of the beds went unoccupied.

The declining number of tourists has forced a considerable number of guides to look for other job opportunities.

Zhong Liangyou said many of his colleagues transferred to real estate agencies, shops and restaurants.

Some tour guides, in an effort to reverse the situation, organized activities to promote a positive image of Xinjiang. Abusamad Ahaiti, a 25-year-old Uyghur guide, posted a public advertisement on popular WeChat public account "The Last Kilometer," sending out an invitation to visitors all across the world to pay a visit to Xinjiang.

"I have to do something to tell people that Xinjiang is a safe and nice place, and we always welcome you," Ahaiti said.

The invitation sent by Ahaiti has received a positive response from tourists and over 300 guides from all over the world.

Losing investors' confidence



Local investment has also been affected.

Concerned about the violence taking place in Xinjiang, some coastal companies who have investments in that region have become worried about the safety of their personnel and property, despite incentives from Xinjiang authorities such as tax cuts and cheap electricity.

Despite a nationwide slowdown in economic growth, Xinjiang's economy began to pick up in recent years due to the massive amount of fixed assets investment. A lot of companies from other provinces were attracted to invest in Xinjiang, which pushed up the GDP growth in recent years. But due to the violent attacks, investor confidence has been shaken.

In 2011, Xinjiang's GDP growth rate ranked 21st among 31 province-level administrations, while in 2013, its GDP growth rose to sixth. In the first quarter of this year, it reached the highest growth point, at 10.2 percent.

However, the GDP growth rate dropped in the second quarter of this year.

Ning Haixing (pseudonym), a Zhejiang businessman, has been considering moving his factory to Xinjiang for a long time.

As a company which specializes manufacturing mobile phone screen, the electricity consumption of his business is huge.

Ning has been considering moving to Shihezi, a city in Xinjiang, over 4,000 kilometers from his hometown in Zhejiang. Last year, a friend of his who owns a science and technology company invested over 350 million yuan in Shihezi to build a factory there and now it is making a profit.

"The fees for electricity for industrial use are much lower. We could save half of our expenses on electricity and pay the fee monthly instead of weekly, which would leave me with adequate cash flow to run the business," Ning said.

However, considering the security situation in Xinjiang, Ning has delayed moving to Xinjiang.

For many other businessmen like Ning, the attractive policies and cheaper expenses aren't enough to offset the higher costs in terms of logistics and human resources in Xinjiang, now compounded by the violence.

 "I have been worried about something awful happening to my employees, considering the situation. Also, the investment here might be influenced by the strict anti-terrorist measures," Luo Lijian, president of the Shenzhen Haoyuan Environment Protection Company, told the Global Times.

Luo recalled how people from other provinces always discussed the safety situation each time before they gathered for a meeting or a private party.

"It was like a routine for us to check on others' safety," Luo said.

"I told the employees not to hang out at night, certainly not alone, to ensure their safety."

Luo is not alone in his concerns. With the increasing expenses incurred by social stability maintenance in Xinjiang, the violent attacks in the region have stalled, albeit with more and more money and human resources pouring into public security.

Statistics from local finance administration showed that in the first half year of this year, among the total public expenses of 14.61 billion yuan in Xinjiang, public security took up 9.39 billion, representing a year-on-year growth of 12.4 percent.

Zhang Lide, deputy director of the Xinjiang Finance Department, said it is normal for such growth in public security expenses.

In Xinjiang, especially in southern Xinjiang where the anti-terrorist situation has been stricter, local authorities have been zealously hunting down the culprits. Since the start of a special campaign to crack down on violent attacks, the local public security bureaus have direct massive manpower and physical resources to this task.

 "We still hold an optimistic attitude toward the development of Xinjiang," Zhang Chunlin said.

 "We are sure, with the crackdown on the violent attacks in Xinjiang and improvements to the development of livelihoods, the social stability situation will improve."

Southern Weekly - Global Times