Liu Gesheng, outgoing Party head of Medog county, says the county's new paved road has done much more than facilitate the flow of people and goods.

The road "plays a critical role in providing confidence and drives decision-making by government and business investors", Liu says.

Given the poor infrastructure in the county, the cost of investment is high in Medog. The cost of constructing two buildings in central China could only build one in Medog.

"Investors chose to withhold their support until the road was completed because investment would not generate equal cost-effectiveness as in other places," Liu says.

"Some may think, 'Medog is so poor, what if they spend the money rather than use it for the project?'"

Missed opportunity

In 2011, a company was about to invest billions of yuan in Medog. However, it withdrew its plan when it discovered the county did not have business administration and taxation authorities and its bank clerks use paper rather than computers to process accounts.

It was an "impressive lesson", says Liu, one of the officials sent by Fujian province to help Tibet's development.

"The shortcomings and difficulties in Medog helped us to gain attention and support. It has turned into our advantage instead," he says.

"Everything became easier to do when the road was all right," Liu says.

Since 2011, more than 30 ministry or province-level leaders have visited Medog to learn about the situation there.

The autonomous region's government also asked for "more favors to boost Medog's rapid development".

Business tax spike

Attracted by favorable policies and services, 11 inland companies opened branches in Medog. Tax contributed from businesses rose from zero in 2010 to 170 million yuan ($28 million) today.

"Without a road, everything is merely empty talk," Liu says.

"People's ideology has changed along with the development of the road. They begin to feel uncomfortable about living in poverty, they start to understand the concept of a market and start thinking about going out."

Facing opportunities brought by the road, Liu and the local government set a short-term plan to transform Medog's economy by focusing on ecological agriculture and ecological tourism.

The long-term plan is to build Medog into a county of hydropower.

Liu says a branch of the Yarlung Zangbo River drops over 2,000 meters within 40 km in Medog county.

It has power capacity three times that of the Three Gorges and could elevate Medog to one of China's richest counties if the water power was tapped, Liu says.

(China Daily USA 08/26/2013 page9)