Mainland China travel itch to be felt worldwide soon

PUBLISHED : Monday, 05 May, 2014, 5:38am
UPDATED : Monday, 05 May, 2014, 6:51am

The staggering number of middle-class mainlanders forecast to soon catch the travel bug is forcing Beijing to expand its infrastructure, but the rest of the world seems unprepared for the numbers that will disembark.

"Chinese tourism development is still in the early stages. China will become a big economic and cultural power and will change the pattern of the global travel and tourism industry. It will have a huge impact on this industry," said Chen Feng, the chairman of Hainan-based airlines and logistics conglomerate HNA Group.

The rate of global change is such that the itinerant Chinese globetrotter is just one, albeit major, trendsetter as rising wealth levels across the developing world afford individuals and families the opportunity to invest more time and capital in domestic and overseas leisure travel.

The primary beneficiaries will be the global hotel chains, airlines, and retail and leisure facility providers, but the full effects should trickle down across the wider economy.

China will change the pattern of the global travel and tourism industry
Chen Feng, chairman, HNA Group

A surge in tourist numbers is made more remarkable given China's closed-door history and tight restrictions on personal travel.

By 2020, the number of individual Chinese going overseas would have doubled to 200 million from last year, CLSA analysts said.

"In the next five years, Chinese outbound tourism will exceed 500 million trips," Vice-Premier Wang Yang said at the recent World Travel and Tourism Council global summit in Hainan, making Chinese travellers the single-largest contributor to a global travel economy that, according to the council, employs 1 in every 11 people worldwide.

For many people in fast-emerging economies such as China, "travel is not just a human need, but is becoming a human right", said Taleb Rifai, the secretary-general of the United Nations World Tourism Organisation.

But the boosters to economic growth are likely to be tempered by worries about sustainable tourism and the dangers of revving up capacity, for example at airports and hotels, for tourists who then never arrive.

In some destinations, the reverse can be a bane. In Hong Kong, Macau and parts of Thailand, the sudden arrival of millions of Chinese left some locals feeling overwhelmed, prompting protests and calls for visa quotas. Further afield, most countries will welcome the extra spending for now.

This year, Chinese nationals will spend 635 billion yuan (HK$786 billion) overseas, a threefold increase since 2008. By 2024, this number will top 1.77 trillion yuan, according to the world tourism council.

At the summit, Wang announced a six-point plan to boost tourism and called it a force for positive cultural exchange. The plan includes reciprocal negotiations to relax visa restrictions, the improvement of consular protection for Chinese overseas, and enhanced labour laws on paid leave. He also said the government would keep investing in airports and general infrastructure.

One goal was for 90 per cent of Chinese travellers to be no further than 90 minutes from an airport, council president and chief executive David Scowsill said.

Airport expansion combined with improvements in air space management will be welcomed by travellers tired of long and fractious delays. In the first half of last year, only 18 per cent of flights departed Beijing on time. In Shanghai, the rate was 28 per cent, according to Flightstats.

A rapid roll-out of capacity brings risk and can burden government and companies with expensive white elephants. In Beijing, for example, profits at high-end hotels dropped 17 per cent last year as new rooms outpaced demand, said Duan Qiang, the chairman of Beijing Tourism Group.

Cheerleaders, however, argue Chinese consumers are now willing to spend more on travel.

"The economy is slowing but travel is still growing. We are very optimistic about the airline and travel market in China," said Xiao Qianhui, the general manager of Shanghai Spring International Travel Service Group.

According to the tourism council's research, the global travel industry will average 4.3 per cent growth this year, and has historically outpaced global gross domestic product by 1 percentage point.