Beijing  - China's far western region of Xinjiang plans to build Asia's largest ski resort to boost tourism in the remote Kanas area, state media said Wednesday.

The government of Xinjiang's scenic Kanas area signed an investment deal worth 5 billion yuan (730 million dollars) Tuesday with the Hong Kong-listed Mongolia Energy Corp to develop the ski resort over 10 years, the official Xinhua news agency said.

The site for the Kanas International Ski Resort was at an average altitude of about 2,000 metres in an area normally covered by snow from November to May.

The resort would also include an artificial lake, golf course, hotels and villas, the agency reported.

Construction was scheduled to start next year and be completed in five phases over 10 years, it said.

The deal was the first major tourism agreement announced since about 200 people died in ethnic rioting in early July in Xinjiang's capital, Urumqi.

The agency quoted Kang Jian, the director of the Kanas scenic area, as saying the local tourism industry had rebounded since July with about 7,000 to 8,000 visitors daily to Kanas this week.

In a separate report, it quoted Kuresh Mahsut, the vice chairman of the regional government, as saying Wednesday that the rioting in July had "seriously affected Xinjiang's tourism industry" with most tourists cancelling plans to visit the region.

"The situation is stabilizing and tourism is recovering," he said, pointing to the holding of a trade fair in Urumqi this week. (dpa)