1

Tourism in China

Presented by

Derek Yue

2

Agenda

Tourism Development in China History Figures Hotel industry CNTA

Latest development in tourism statistics in China TSA in China

3

Background history

1949 – 1974 China was closed-door Only selected foreign visitors

Late 1970s Leadership decide to promote tourism Lifting travel restrictions, investment in transport …as a means to earn foreign exchange

4

Visitor arrivals

1981: 7.7 million 2007: 130 million Averaged annual growth rate: 11%

5

Tourism receipt

1981: US$8 billion 2007: US$420 billlion Averaged annual growth rate: 20%

Increase in visitor arrivals Increase in per capita spending

6

Tourism receipts (million US$)

0

50

100

150

200

250

300

350

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

7

China Tourism Overview 2007

Total Visitor Arrivals reached 130 million 78 million from Hong Kong (60%) 23 million from Macao (18%) 4 million from Taiwan (3%) 26 million from foreign countries (19%)

Tourism expenditure from Inbound Tourism US$420 billion Per diem spending of overnight visitor: US$200

8

Hotel industry

Influx of visitors require high quality hotels to accommodate

Generate huge demand for hotels 6th 5-year plan (1981-1985)

Identified hotel industry as important component to be developed

Boost economy and social development

9

Hotel industry

1978: beginning of the reform 137 Hotels providing 15,539 rooms

2006: 12,751 Hotels providing 1,459,800 rooms

FDI opportunity Invest in construction Management skill spillover

10

The Jianguo Hotel 北京建國飯店 Opened in 1982 First international hotel invested jointly by

foreign and Chinese Managed by Peninsula group of Hong Kong

11

Spillover of management skills

Management system of Hong Kong experts with local staff: a blend of international standard with local culture

Vertical management: Clearly defined responsibilities at different levels

12

Spillover of management skills

First 5 years of operation Top and middle management by Hong Kong experts

After 5 years.. Proportion of Hong Kong managers decrease

After 10 years… Peninsula group retreat Completely run by local staff

Becomes a leader of hotel industry Other hotels sent managers to learn from its experience

13

China National Tourism Administration

CNTA Agency in charge of tourism Affiliated to the State Council

Chairman Shao Qiwei 邵琪偉

14

Functions of CNTA Plan & Coordinate development of tourism

industry Implementation of market development strategies Optimize use of tourism resources Ensure tourism service quality Promote international communication and

cooperation Policy on travel to Hong Kong, Macao and Taiwan Oversee the education and training

15

Latest Development

5th UNWTO International Conference on Tourism Statistics

30 March – 2 April 2009

17

UNWTO

World Tourism Organization Specialized agency of the United Nations Promote and develop tourism statistics

18

Economic contribution of Tourism

Tourism as a service domain that comprise a wide range of economic activities across different industry

Status of buyer (visitor or local) determine tourism related or not

19

Tourism Satellite Account

As a distinctive method to measure Value-added Employment creation

TSA divides economic activities into tourism and non-tourism activities

Direct contribution can be measured and compared with traditional industries

20

Industry Tourism Ratio (HK)

Selected tourism industry 2000 2003 2006

Hotels / boarding houses 0.67 0.72 0.74

Air transport and water passenger transport

0.38 0.31 0.40

Retail trade 0.13 0.20 0.23

Restaurants 0.10 0.13 0.16

Source: Census and Statistics Dept

21

China – Moving towards TSA

Presentation by CNTA at Conference “Provincial and National TSA development

in China”

22

Provincial TSA development

Jiangsu Province Pilot run of TSA (reference year 2002) Tourism value-added making up 4.2% of GDP Proportion of tourism employment: 8.5%

Beijing Municipality (reference year 2004) Tourism Value-added making up 6.7% of GDP Proportion of tourism development 11.7%

23

Ultimate goal

Develop TSA for national level More and more trial run Yantai in Shandong Province

Comply UNWTO standard Fully understand economic contribution and

significance of tourism in Chinese economy

24

Q&A