Cashing in

Ma Degong was one of those encouraged investors who are engaged in the handicrafts business. In June 2007, with the support of a 5-million-yuan ($750,000) government loan, he invested 9 million yuan ($1.35 million) to set up a company of his own. Today, the company operates 12 art craft studios that employ more than 100 workers from local rural families. As of this November, his company's output value had totaled 10 million yuan ($1.5 million).

"I'm confident of the future of my business," Ma said. "I see with my own eyes that there is a big market out there waiting for us to wisely use our rich cultural resources."

Located on the northeastern part of the Tibetan Plateau, Qinghai Province has been an ethnic melting pot of China for centuries, home to 55 ethnic groups. Although the rural population there live mainly on agriculture and animal husbandry, the handicraft tradition has continued to be passed down throughout history.

"But [handicraft] skills and creative minds were separated from each other," Ma told ChinAfrica. "So the key of this business is to work out an effective mechanism to realize the scale production."

In Ma's company, the production follows a "studio-worker" model. Specifically speaking, the company will sign a bunch of individual studios specializing in different craft making categories. These studios employ their own workers and organize training courses. They get orders from the company and make sure that the production is finished in time. The company purchases these products from the studios and takes care of the marketing and selling process.

"Generally speaking, the prices we offer for the studio products are 15-20 percent higher than the cost and 30 percent lower than the market prices," Ma said, adding that the whole operation makes sure that all participants benefit from the business.

Employed in the handicraft business for more than five years, Han Tahairi told ChinAfrica that the "studio-worker" model has been widely used in the sector.

"It is a system that helps to link the government, the investors and the individual craft artisans together," he said. "With this pattern, we find a way for our handicraft tradition to develop further and our rural population to improve their lifestyles."

Official statistics show that from 2003 to 2009, the number of people employed by the handicraft sector increased by 2,400 percent in Qinghai. And the output value of this industry rose by 435 percent to reach 1.07 billion yuan ($159.7 million).

Traditionally speaking

When it comes to marketing their products, both Ma and Han said they are not concerned. Apart from some order offers guaranteed by government, they've already built up their own client credit.

From January to November, Ma gained a total of 10-million-yuan ($1.5 million) orders, of which only one fifth came from government purchases.

"We've got to learn to survive the market competition even though we had a good boost from government support," Han said. He insists on having an independent, specialized department in his company to monitor the quality of all products.

Now the most important challenge confronting him is that he needs to find more competent workers to meet the demand of a competitive market.

Looking at the big picture, Cao Ping, Director of the Qinghai Provincial Department of Culture, said the province should stick to what it has in abundance. "We're not strong in animation and film, but we're rich in folklore resources. That's exactly what we need to stick to," Cao told ChinAfrica, adding that only items that possess the characteristics of the region, like local handicrafts, can find a receptive market and provide locals a chance to benefit.

Qinghai – at a glance

> Qinghai's economy is amongst the smallest in all of China. Its GDP for 2009 was 108.1 billion yuan ($16.2 billion) and contributes to about 0.3 percent of the national economy. Its per-capita GDP in 2009 was 19,407 yuan ($2,900).

> Typical folk art handicrafts of the province include Buddhist Thangka paintings, embroidery, jade carvings, woodcarvings, paper cuttings, filigree (working fine wire into delicate patterns), folk shadowgraphs and kilim carpets.

Source: www.qhtjj.gov.cn / www.qhly.gov.cn