China must ramp up for inbound tourism

As China's tourism contribution to the global economy is expected to overtake that of the United State by 2027, China can focus on sustainable infrastructure growth and expand its tourism economy by making it more welcoming to international visitors, according to an industry expert.

World Travel & Tourism Council (WTTC) said in their annual report that travel and tourism growth in China was "lower than expected" for 2013 and that the sector is not expected to grow as quickly as previously predicted over the next decade.

However, China is "still one of only two G20 countries in the top 20 for travel and tourism GDP growth this year", according to David Scowsill, president and CEO of WTTC.

The Chinese tourism sector - accounting for inbound and outbound tourism - contributed 5.22 trillion yuan ($844.5 billion) to China's GDP in 2013, and is forecast to rise by 8.3 percent in 2014, according to the WTTC.

"... you have so many people coming into the middle classes for the first time, there's a huge pent-up demand for travel from these people," Scowsill told China Daily.

"Once you have got sufficient disposable income to buy your refrigerator and your car, then you start to travel domestically, and ultimately you start to travel internationally," said Scowsill. "So the growth of the middle class in China is one of the key drivers here."

Outbound Chinese travelers are spending huge amount of money and traveling at an "explosive rate" - expected to exceed 200 million by 2020 - which is just the "tip of the iceberg" because domestic travel is fueling the economy "even faster", he said.

But Scowsill said one challenge for Chinese tourism growth is sustainability. While infrastructure plans in China are materializing faster than those in Western countries, sustainability is a worry. The environmental impacts of infrastructure development need to be "monitored and minimized," he said.

Another concern is that inbound tourism - foreigners visiting China - has stagnated over the last few years. In 2010, 55.7 million people visited China from overseas, which increased to 57.6 million in 2011, and 57.7 million in 2012, according to Scowsill.

"There is a lot of competition for the expanding middle classes on China's doorstep," he said. "China needs to make sure that those travelers choose China over other countries like Thailand and Indonesia."

Spending by foreign visitors was only 9.1 percent of tourism and travel's contribution to GDP, compared to the 90.9 percent in domestic spending, according to WTTC figures.

Strict visa requirements is one reason. The other reason Scowsill attributes to China not properly marketing the country as a brand.

China needs to promote the country instead of a group of individual provinces, similar to what the US used to do before the Corporation for Travel Promotion Act, when states like Florida, Nevada and California would have to "make their case internationally" as a travel destination, he said.

Liping Cai, director of Purdue University's tourism and hospitality research center who was associated with the WTTC in 2005, said that inbound tourism to China may not be as important to the Chinese economy as it was before.

"Given the huge domestic demand, I don't know if that's a priority for China anymore, to attract foreign business travelers," Cai said. "China tourism started as inbound tourism back in 1978-79. For the first 10 years, tourism meant inbound tourism by foreigners to China. But in the 1990s, the government started to encourage domestic travel."

Cai said that he doesn't think the government is using visas as tools to limit inbound travel. "It's just the process maybe perceived as difficult," he added.

amyhe@chindailyusa.com

(China Daily USA 03/19/2014 page2)