Silk Road Adventure

June 10-11

Hami and Dunhuang China

We left our hotel each morning expecting miserably hot Gobi Desert weather, but were pleasantly surprised in both cases. Part of it was due to the high altitude – we reached a height of 6,000 ft. - and the rest was due to uncommonly cool weather. The winds were blowing up from the valleys into the mountains. Except for the second half of the second day, we were on national roads (motorcycles are exempt from paying tolls) with heavy construction improving the conditions. There were thousands of pieces of heavy equipment along the road, and at least 10,000 laborers working on them. China is making an enormous investment into connecting the populous part of China with the lightly populated northwest.

Driving in China

I cannot get over the Chinese driving. On three occasions during these two days a driver coming from the opposite direction as little as 200 feet ahead would pull out into my lane while passing another car and expect me to move off the road. With their car and my motorcycle both moving at 80 mph, it is a 160 mph closing speed, and if I had been daydreaming or looking off at the sites, I would become an occupant inside the oncoming car. In one case there was a car on the shoulder on my side of the road and the person coming toward me in my lane forced me to squeeze between his car and the car on the shoulder. There could not have been more than 1 ½ ft. on either side of my panniers. If we were to drive into the populous part of China, we would see automobile wrecks on all sides of the road. As it is, however, we have seen very few accidents – only one truck that looked like it was blown over on the road from Urumqi to Turpan.

One of the remarkable aspects of these two days was observing the flow of construction equipment and capital equipment moving west. There was a vehicle load of eight small vans with two vans on each side – certainly an oversize load for the highway. In addition, there was construction equipment, chemical equipment, oil and gas equipment, all sorts of variations of capital, but all of it moving into the northwest region of China.

Along the way we traveled through a variety of oases, green areas in the center of the desert. The mountains were to the north of us and generally these oases were separated from the mountains by many miles, but clearly it was mountain water that was nurturing them. The water must have come underground from the mountains through an aquifer and then percolated up in the oases.

After crossing the border into Gansu Province, where Dunhuang is located, we all rode a short distance into the desert to find a remembrance that the former GlobeRiders Silk Road group had buried two years before. We also went to honor a member of that group who has since died tragically in a motorcycle accident. We found the buried treasure, dug it up, added our memorabilia to the collection - a T shirt with everyone's signature on it, and some other stuff. We listened to a moving tribute from Helge about our fallen brother and a little about his story.

China Economics

I don't really consider this part area part of China, but it is interesting to review the economics of China to understand how they are supporting the Uygurs in the Xinjaing autonomous region.

China is about the same area as the U.S. – 9.5 million sq. km vs. 9.4 sq. km.

The per capita economics are interesting. The gross domestic product per capita in China is $1,470 vs. the following: Turkey $8,200; Georgia $3,300; Azerbaijan $4,800; Turkmenistan $8,000; U.S. $39,430 (data from The Economist).

Obviously, China is a very prosperous nation, but it has a heavy payload in population.

The gross net income per capita paints a better picture - $1,500 for China vs. $2,260 for Kazakhstan, $1,340 for Turkmenistan. How do they get away such low per capita GNP and the net gross income numbers? There are several answers:

1.A yuan goes a long way. There is much more purchasing power in terms of any commodity, including food, than an equivalent dollar would have in the U.S.
2.Many of the poorest people are subsistence farmers, and they grow much of their own food – they do not need to go the supermarket.
3.In the rural areas where the poverty abounds, they do not have access to what is happening in the rest of the world – they don't know what they don't have.
4.The public sees the improvements that the nation is making – the money China is spending to improve their lives (like the equipment moving northwest, better roads, better irrigation systems, better civil systems and public buildings), and they are willing to wait.

As a country, China has low private consumption. Only 41% of their gross national product goes into private consumption – 70% for the U.S. Forty-four percent of China's gross national product is investment dollars in things that will provide revenue in the future. Our equivalent metric is only 16%. Obviously, China is in a different stage of its development than the U.S., and it would be expected to spend more on infrastructure than we do.

China is often thought of as an exporting country, but because of all the building that is going on – infrastructure and industrial capacity – their exports are less than 10% greater than their imports. Our problem is that most of their exports are to us. We are their largest trade partner at 21% of total exports, and we only represent 8% of their imports. Maybe we need to be better salesmen or maybe we need a better way to level the import/export table. It is interesting, however, to note that our major export is really a non-cash export. It is considered "hip" to wear a shirt with an American phrase on it, even if the grammar is bad or if the spelling is wrong. I saw a couple in a parking lot who were both dressed in U.S. military special forces uniforms – not real uniforms, to them it was a costume.

One of the most interesting concepts about China is the way their economy is centrally managed. During World War II, and to smaller extent afterward, the U.S. had a managed economy with General George Marshall at the helm. A lot of great accomplishments occurred during this period. I think this will be China's greatest period. They are managing an economy successfully, holding back on domestic consumption, building infrastructure and at the same time holding back social reforms to attract foreign investment. However, I cannot help but think at some point the largest socialist state in the world will have to return a little bit to its socialist roots. It could be an exciting time for everyone when this happens. It will not happen like Venezuela, but there could be a slow and methodical freezing out of foreign investors, not unlike what has happened in Japan. There are all sorts of problems investing in Japan or creating new businesses in Japan, and the same could happen in the future in China.

Buddhism

The sciatica in my back is still bothering me, so I have been a poor tourist and have not gone to visit the large Buda statues in hundreds of grottos in the sandstone cliffs nearby. It is interesting to note, however, that there is not a single Buddhist priest left, and there is no provision for Buddhists to pray in this important Buddhist area.

Tomorrow we will ride further into the Gobi Desert to Jiayuguan, a distance of 300 miles. I'm hoping the cool weather holds.

That's all for now.

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