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dispatches: Notes from different corners of the world.

Dispatches From China's Wild West

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from: Joshua Kucera

The New Silk Road

Posted Thursday, March 6, 2008, at 10:40 AM ET

URUMQI, China—Walking into the Bian Jiang Hotel in Urumqi was a bit like stepping into a post-Soviet version of the Star Wars cantina scene. Every variety of Russian and Central Asian hustler was there: dark-skinned, mustached men in leather jackets; blond Russian women in track pants and midriff-baring T-shirts; Uzbek women with black eyes and flowing, multicolored dresses. The clocks behind the reception desk didn't bother to display the time in London or New York, or even Beijing, but they showed eight time zones across the former Soviet Union, from Baku to Novosibirsk.

After two weeks in China, where I was completely at sea with the language, I was thrilled to be in a place where I could communicate unaided in basic Russian. In the coffee shop, I struck up a conversation with a trio of middle-aged, gold-toothed Uzbek women at the table next to me. But they weren't interested in chitchat and immediately got down to business: "So, do you want a girl?" one asked.

Over the last 15 years, Urumqi, the capital of Xinjiang, has developed into the main hub of a gritty, 21^st-century Silk Road that has emerged out of the ruins of the Soviet Union. Under the Soviet Union's planned economy, almost all its international trade, even from the far reaches of the empire, was conducted through Moscow. But with the collapse of the USSR, countries like Kazakhstan, Uzbekistan, and Kyrgyzstan—and cities in eastern Russia—are doing more and more of their business with neighboring China.

That trade has changed the face of Urumqi, an undistinguished city of gray concrete high rises and a freeway system whose decrepitude reminded me of Detroit. Signs in Russian—the lingua franca of the former Soviet states—were everywhere, and when I walked into shops I was greeted with "Zdrastvuitye" more often than "Hello."

The goods traded these days are a good deal less romantic than the silk, gold, and ivory of the original Silk Road. Urumqi's streets are filled with Russian-language signs advertising auto parts and construction supplies. A mall next to the Bian Jiang sells cheap Chinese clothes, MP3 players, and cell phones at wholesale prices to buyers from Russia and Central Asia.

The Hualin Market, a massive furniture and building-materials emporium, is one of the top destinations for shoppers from Central Asia. It has five floors, in ascending order of luxury: The first floor is a chaotic, jumbled mess of couches shrink-wrapped in plastic and coffee tables stacked on top of one another. By the fourth and fifth floors, though, it looks like an upscale American shopping mall.

I stopped into one shop on the fourth floor, where a Kazakh woman wearing white, fringed-leather boots shopped among the $2,500 couches. A shop assistant served me a paper cup of green tea and talked about the clientele of the shop. More than half of visitors are from Central Asia, mainly Kazakhstan, where the oil boom has spurred the growth of a large middle class. The Central Asian market is growing so much, Fang Wei said, that Hualin is planning to open a branch in Almaty, the biggest city in Kazakhstan. She said she only speaks a few words of Russian—hello, goodbye, and the names of several types of furniture—but all the Central Asian shoppers hire their own Chinese translators.

Today, because the industries of most former Soviet states are largely ruined and the countries have little to export, the trade is pretty one-sided. In 2006, for example, Chinese exports to Kyrgyzstan were 150 times greater than the trade in the other direction. The only commodities China imports in large quantities from Central Asia are heroin, which comes from Afghanistan via Tajikistan, and oil and natural gas, mainly from Kazakhstan, the only country in the region with which China has something resembling a balance of trade.

Trade between Xinjiang and Central Asian has evolved since the collapse of the Soviet Union in 1991, one government trade expert told me on condition that I not use his name. The first wave consisted of small-time traders buying low-quality clothes and other consumer goods, but as Russia and Kazakhstan grow richer on oil money, and China produces higher-quality products, Chinese exports now include cars and heavy machinery. Trade between Xinjiang and Kazakhstan totaled $6 billion in 2005, and Xinjiang's total international trade has increased from less than $1 billion in 1996 to an estimated $9 billion last year.

"Now, more people in university study Russian than English here, and the ones who study Russian are hired even before they graduate," he said. In 2004, flights from Urumqi to Moscow, Almaty, and Tashkent were only weekly; now there are daily flights to those cities, as well as direct flights from Urumqi to Kyrgyzstan, Tajikistan, Azerbaijan, Afghanistan, Pakistan, and several cities in Russia, Kazakhstan, and Uzbekistan.

Today, only 1 percent of trade between Europe and China travels by land—some key roads in Central Asia are unpaved, and the Soviet Union created its railroads on a different gauge from neighboring countries, necessitating time-consuming transfers over borders into China and Europe. Hoping to reduce the cost and duration of transcontinental travel, China and the European Union are floating a variety of projects to create new, efficient transportation corridors that would pass straight through Xinjiang. In November 2007, the Asian Development Bank announced an $18 billion program to create six new highways linking Europe and Asia, four of which would pass through Xinjiang.

They highway project was billed as a "modern day Silk Road," and it looks like the hustlers at the Bian Jiang and the shoppers at Hualin are merely the pioneers.