WESTERN DYNAMICS: The 18th Urumqi Foreign Economic and Trade Fair is held September 1-5, 2009. More than 500 foreign businessmen from 29 countries and regions attended the fair (ZHAO GE)

According to data from the National Bureau of Statistics (NBS), Xinjiang Uygur Autonomous Region's GDP grew a robust 8.1 percent in 2009, with retail sales and net income of farmers soaring at double-digit rates.

In Premier Wen Jiabao's government work report delivered on March 5, the government pledged stronger support for Xinjiang development, pointing to bright prospects for the region's future, Wang Lequan, a National People's Congress (NPC) deputy and Secretary of Xinjiang Uygur Autonomous Regional Committee of the Communist Party of China (CPC), told Beijing Review on the sidelines of this year's NPC session.

This turn of events was unimaginable last year when the financial crisis rippled through the far-flung region. The freefall in commodity prices dealt a heavy blow to the oil-dependent economy, and a crash in exports to neighboring countries intensified the gloomy economic situation in Xinjiang.

Worse still, the July 5 riot cast an ominous shadow over consumer sentiment, and sent the once-booming local tourism industry into a downward spiral. Many small companies closed their businesses and thousands of tour groups cancelled trips to Xinjiang out of safety concerns, said Nur Bekri, deputy to the 11th NPC and Chairman of Xinjiang Uygur Autonomous Region, at a press conference on March 7.

On top of the crises came the heaviest snowstorm in a decade in the last winter that flattened more than 38,000 houses and brought transportation to a halt. The biggest victims were the nomads as blizzards crushed vast grassland, leaving their sheep nowhere to graze.

But Xinjiang was not left to find economic equilibrium on its own. As part of its vast stimulus packages, the Central Government kicked off an investing spree in sectors ranging from infrastructure and energy exploration to irrigation and forestation in Xinjiang. NBS data showed the region's investments in fixed-assets skyrocketed 25 percent to reach 283 billion yuan ($41.4 billion) last year, effectively restarting the flagging growth engine and providing a solid floor under what would otherwise have been a deeper downturn.

Efforts were also taken to heal the wounds left by the July 5 riot. Damaged shops were compensated with tax waivers and cash subsidies, while hard-hit companies were given easier access to bank lending.

The tourism sector, in particular, basked in the glow of powerful policy incentives. Heavy subsidies were distributed to travel agencies, hotels and resort operators to allow them to entice visitors with lower charges and better services. Measures were also taken to strengthen marketing and promotional campaigns for Xinjiang's major scenic spots, like the Tianshan Mountain and Grape Valley.

The stiff efforts have already paid off. Xinjiang played host to some 350,000 foreign tourists last year, raking in revenues of around $140 million, according to the Xinjiang Tourism Administration.

"Though it only makes up roughly 7 percent of Xinjiang's GDP, the tourism sector has significant implications for retail sales and job creation," said Zhang Handong, an NPC deputy and Secretary of Aletai Prefecture Committee of the CPC, Xinjiang Uygur Autonomous Region.

"Aletai has vast areas of year-round snow that are comparable to Vancouver, Canada, host city of the recent Winter Olympic Games, so we have plans to build a winter sports resort there," said Zhang.

Gela Yishamudin, an NPC deputy and Mayor of Urumqi, capital city of Xinjiang, told Beijing Review the region's industry is also moving up the value chain and is diversifying into advanced manufacturing, such as wind turbines.

The Economic and Technology Development Zone in Urumqi, for example, has attracted around 3,470 hi-tech enterprises with tax and financing incentives, he said.

"The financial crisis has obviously been a powerful catalyst for Xinjiang to restructure its economy and wean off its dependence on oil," he added.

Zhang Xin, an NPC deputy and Xinjiang Tebian Electric Apparatus Stock Co. Ltd., said the region is recovering its appeal to investors at home and abroad with increasing social stability and economic vitality.

"We have confidence that the modern manufacturing industry in Xinjiang will come into full swing on the back of geographic advantages and rich resources," he added.

But the region still has a long way to go toward total rural prosperity, especially in the underdeveloped southern areas, said Cheng Zhenshan, an NPC deputy and Secretary of Hetian Prefecture Committee of CPC, Xinjiang Uygur Autonomous Region.

Efforts are still needed to settle the wandering nomads living in poverty and help them build houses and find jobs, said Cheng.

"Only 30 percent of junior high graduates in Hetian can afford further education. So it is necessary to strengthen vocational training to prepare the young for the job market," he added.