Travel opens up new silk route for China
CHINA Union Pay, China’s own credit card, set up in 2002, is one of the fastest growing credits cards brands across the world, without any marketing campaigns about its buying power.
The 34 million Chinese that travelled overseas last year all act as unofficial brand ambassadors. In Australia, National Australia Bank has teamed with China Union Pay so that Chinese tourists can make EFTPOS purchases and ATM withdrawals with their credit and debit cards. Banks in the US, Germany and Egypt are among the others following suit.
There is a reason why travel industry calls China the single most important development in world tourism. The Economist Intelligence Unit estimates there will be 60 million tourists out of mainland China by 2010 and 100 million by 2015. The WTO believes the 100 million figure will be reached later, in 2020.
Last year, 15 countries and regions opened their doors to Chinese tourists. To date, Chinese travellers can visit 132 destinations. Among the newest to be approved are Oman, Morocco and Syria.
The news in the inbound travel sector is no less exciting. China can expect to receive 24 million foreign travellers this year, up from 22 million last year.
This year’s figures are already optimistic. Nearly 12.12 million foreigners came to the Chinese mainland for sightseeing from January to June, up 18.47 per cent year-on-year, according to the latest figures from the China National Tourism Administration. Tourism generated nearly $17.94 billion in foreign currency in the first six months, up 13.1 per cent year-on-year. More than half or $10.25 billion came from foreign tourists, up 19.64 per cent over the same period of last year.
The Chinese State Tourism Administration is working to “explore potential markets such as South America, the Middle East and Africa.”
Events such the 2008 Beijing Olympic Games and the World Expo in Shanghai in the year 2010 will only see those numbers grow.
Major international tourism businesses are being encouraged to enter China's tourism industry, an area covered by China's membership in the World Trade Organisation. The government plans to lift restrictions on foreign-funded travel services looking to set up branches in China from this year.
When it comes to the Middle East and China, it is a question of renewing old ties. More than 2000 years ago when silk probably first arrived in Europe, and the Romans believed that it came from India, the Arabs were sailing all the way to Guangzhou (Canton) in southern China, while merchants made their way overland to Xi’an in the Yellow River Valley. Middle East has trade ties with China since the medieval period.
And now, with many of Arab countries being granted the Approved Destination status for Chinese tourists, establishing free trade zones and China welcoming Middle East tourists, “a new, unlimited 'Silk Road' will be formed," according to the Chinese vice minister of trade.
There are several initiatives that will lead to this. When China and representatives of Arab League countries met in Beijing in 2006, they set a target of doubling the trade between them to $100 billion by 2010. Starting from a relatively small base, Chinese trade with the Arab world had soared tenfold in the previous decade, reaching $51.3 billion. Arab investment is welcomed in China, which attracted $20 billion from Gulf countries last year alone.
In the region, individually, various countries are stepping up efforts to attract people from the world’s most populated country. Most recently, Turkey is trying to set figures for attracting tourists from China. Turkey only receives between 40,000 and 50,000 of the 132 million Chinese travelling the world each year. Even if two per cent of them come to Turkey each year, they will form half the tourist population in Turkey.
Jordan also wants to strengthen its ties with China. The volume of trade relations between Jordan and China stood at $1.3 billion in 2006, a 15 per cent increase on 2005. Already China has 153 million worth of investments in Jordan.
The UAE and China are close to signing the Approved Destination Status agreement. Under ADS, Chinese nationals will be able to obtain a single-entry visa to the UAE, subject to the final agreement, provided the trip is organised by an approved operator.
Once in full effect, it will significantly enhance the growth of Dubai's tourism and MICE (meetings, incentives, conventions and exhibitions) markets. Last year, the bilateral trade volume between China and the UAE rose to $ 14.2 billion, an increase of nearly 32 per cent.
China and the GCC have completed a round of talks on a free trade agreement as part of Beijing's efforts to boost long-term cooperation with states in the region.
Saudi Prince Alwaleed bin Talal Al Saud made his first hotel investment in China only this past May, by buying the leading hotel in the industrial city of Kunshan, near Shanghai. He paid $58 million for the 387-room hotel, a property that began operating only two years ago.
Now Kingdom Holdings has reportedly earmarked $1 billion for investment in China’s booming hotel industry.
by Prachi Parihar