International Railroad Discussion > Canadians help luxury train to Lhasa keep on track amid

GEOFFREY YORK

From Monday's Globe and Mail

March 30, 2008 at 8:51 PM EDT

BEIJING — The timing was awkward, to say the least. On March 13, as Lhasa was about to explode into bloodshed, a tourism company was announcing that China's first luxury train would soon be carrying "travel connoisseurs" to Tibet — complete with butler service "to cater to the whims of each guest."

The next day, Lhasa was in flames and Tibetan monks were battling Chinese police. Hundreds of people would be killed or injured over the following two weeks. But none of the violence has deterred the entrepreneurs — including Canadian financiers and mining companies — who still see Tibet as a happy hunting ground for potential profits.

China has banned almost all foreigners from entering Tibet since the protests began but foreign investors have managed to keep their projects going.

"We're pleased that we're moving forward," said Bill Edward, vice-president of marketing at Tangula Group Ltd., which is charging as much as $5,500 (U.S.) per ticket for the luxury train to Tibet, beginning shortly after the Beijing Olympics this summer.

He admitted that ticket sales have been "a little bit quieter" since the Tibetan protests erupted. "But we're still getting requests for group bookings," he said. "Our plans are definitely going ahead. We're on track to launch on Sept. 1."

The company says it is offering "the ultimate in luxury rail travel" — a kind of Orient Express for today's wealthiest tourists. It promises an experience of "relaxed elegance" that provides "remote exploration in comfort and style." Passengers will have "privileged access" to "mystical Buddhist monasteries" and can enjoy the opportunity of "sipping tea with grassland nomads."

Its train cars will feature flat-screen televisions, wireless Internet service, entertainment systems, en-suite bathrooms and showers, gourmet meals, around-the-clock butler service, and in-room "wellness" treatments. "Every need is anticipated, every whim satisfied," the company boasts.

Canadian investors were instrumental in launching the luxury train company, although a majority stake was purchased by a Hong Kong tourism company for $52.9-million last November. Its 49 custom-built train cars were manufactured by a joint venture between a Chinese company and two Canadian firms — Bombardier Inc. and Power Corp.

Some Tibetan activist groups, calling for a boycott of the luxury trains, have criticized the heavy Canadian business involvement in the region. One group, Students for a Free Tibet, has said it is "appalling" that Canadian companies are profiting from China's "colonial policy" in Tibet.

But Canadian entrepreneurs are still gung-ho on Tibet, despite the violent protests and the eviction of foreigners from Tibet.

Howard Balloch, a former Canadian ambassador to Beijing, is one of the shareholders in the luxury train company and served as an adviser to help it get started. He believes that the Tibet crisis will not have a serious impact on foreign investors in Tibet. "I don't think this will deter the Chinese government from encouraging foreign businesses to invest in Tibet," he said in an interview.

Mr. Balloch, who heads an investment banking firm in Beijing, insists that foreign investment is beneficial for Tibetans. "I continue to believe that development is good and has a positive impact on people's lives," he said. "Tourism brings in a substantial amount of activities which local people can benefit from."

At the same time, Canadian investors in Tibet should make sure that they are helping local residents, he said. "I hope Canadian companies will make a special effort to maximize their benefits to the local community. If recent events have opened up wounds in Tibet, it's all the more important to show that their activities have benefits to the local communities."

Continental Minerals Corp., a Vancouver-based mining company, is pushing ahead with plans for a $500-million copper and gold mine in central Tibet, even though the Tibetan crisis has disrupted some of its activities in recent weeks.

"At the moment, it seems to be getting back to normal, and we have no plans to change our business plan," said Dickson Hall, the company's vice-president of business development.

"From day one, we have worked very carefully to establish ourselves as good corporate citizens in the area," he said. "We'll monitor and see what happens, but we feel that the project will continue."

Continental has finished its feasibility studies and is aiming to apply for a mining licence by the middle of this year for what would become the first foreign-owned mine in Tibet.

The company's office in Lhasa was closed for 10 days because of the violent protests and some of its business was interrupted by the temporary shutdown of banks in Lhasa, but these were "nothing but minor headaches," Mr. Hall said.

He agreed with Mr. Balloch that community benefits are crucial to business projects in Tibet. His company has cultivated relations with local villagers around the mine site by providing jobs, training, road equipment, electrification and donations to the local school.

Several other Canadian companies have invested in Tibet and the broader Tibetan regions of China, including other mining companies and a producer of mineral water.

Bombardier and another Canadian company, Nortel Networks, played key roles in supplying equipment for China's controversial railway to Tibet in 2006.