Published by: World Tibet Network News, Thursday, October 3, 1996

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)