Economy

Hainan's eerie boom

By Huang Xiangyang (chinadaily.com.cn)
Updated: 2010-05-26 14:58

An economic boom driven primarily by the property sector is not only unsustainable but also dangerous. This has been proven by the bubbles gone bust worldwide, from Tokyo to Dubai. The current situation in Hainan reminds us of the property craze on the island in the early 1990s, when there were 20,000 property firms in China's smallest province with about six million people. The burst of the bubble led to 30 billion yuan in bad bank loans, and it took nearly 10 years for Hainan to digest uncompleted housing projects before getting back on its feet.

It is deplorable to see that Hainan's latest plan to become an international tourist resort is being translated into another round of property craze that benefits only a few.

Actually Hainan has a long way to go in terms of services and infrastructure, not property development, before it can compete with other world resorts.

Turning off air conditioning at hotel lobbies may be one of the easiest steps to take for Hainan to become more like Hawaii. The more urgent task is to free tourists from feeling that they are constantly being ripped off. An ice cream at any tourist site could easily cost me twice as much as in Beijing. A chain smoker in our tour group told me Hainan charges the highest price for his favorite cigarettes. Near the museum for a revolutionary women's detachment of the Red Army in the 1930s, tourists pay 10 yuan to have a chance to kill live chickens with "cannon balls," a bloody form of entertainment I doubt you could find at any other world resort.

On my way to the airport, I asked my taxi driver what benefits he had gotten from the announcement of Hainan's tourism ambition. His answer was an instant "none." He said his son, who just graduated from college, has yet to find a job. The break-neck speed of development in the property market does not create many job opportunities for the locals, he said.

Government officials have to rethink their tourism campaign if it does not trickle down to benefit the majority of the public.