Editor’s note: This is a translated and edited version of an article that was originally published in Beijing News. It was no doubt published to coincide with the recently concluded “Golden Week” National Day holiday, which is one of the most popular times of the year for Chinese to travel domestically. The story affirms what many may have already surmised by simply looking at the traffic in the local train station or airport — regardless of the impacts of the global recession, Chinese domestic travel is “booming”! Yet, hidden dangers do exist which China must act quickly to resolve…

In recent years, China's domestic and international tourism have both displayed massive growth—the number of people travelling, the tourism revenue and the per capita consumption continue to increase dramatically. It is no small wonder that China seems to be encouraging its citizens to engage in some domestic travel. Industry insiders have long believed that developing the tourism industry is good for a country, as it promotes industrial restructuring and pushes forward economic transformation. But now that Europe and the United States are facing the risk of a "double dip" recession (which typically hits non-essential industries like tourism first), will China's tourism industry still be able buck this global trend?

Initial 2011 Tourism data quite remarkable

The China National Tourism Administration recently reported that in the first six months of 2011, total revenue from tourism exceeded 1 trillion RMB, a marked increase of approximately 18% over the same period last year. Revenue from domestic tourism made up about 920 billion RMB of that total, up 22% since 2010. The number of domestically travelling Chinese tourists was approximately 1.33 billion person-time, up 13% since 2010. The number of outbound Chinese tourists was approximately 32 million, up 19% since 2010. The number of inbound foreign tourists was 66 million, up 1% since 2010. Moreover, foreign exchange revenue (money foreign tourists spent in China) was approximately 22.5 billion USD, (up 1% since 2010). This data suggests that despite the "double dip" recession that has shrouded the US and European economies (and their domestic tourism industries), China's tourism industry appears to have bucked the trend. The mid-year reports for tourism companies also show strong increases. According to data provided by Tebon Securities, in the statistics that it has for 15 tourism or catering companies in China, 10 have shown positive growth performance—with Lijiang Tourism, ST Zhangjiajie, Guilin Tourism and Beijing Tourism enjoying increases of more than 100% this year!

Tourism has become a driving force of revenue

Once a huge growth industry, the number of inbound foreign tourists this year only grew by about 1%. Dai Bin, the director of the Chinese Tourism Academy believes that the inbound tourism market has likely been dragged down by the US and European economies. Luckily, domestic tourism is flourishing. Dai Bin states that in 2010, 2.1 billion travel trips were made inside China, and that in 2011, forecasts are anticipating that more than 2.5 billion trips will be made domestically. The total revenue from the tourism industry is expected to exceed 2 trillion RMB, which would account for more than 10% of all social spending in China in 2011. As such, domestic tourism really has become one of China’s core industries.

Concerns

Despite these phenomenal domestic tourism figures, industry insiders are still concerned about the increasing number of outbound Chinese tourists in recent years. Dai Bin said that there are three clear objective factors that explain the current boom in outbound travel: issues with the Renminbi exchange rate, the devaluation of the Renminbi domestically and the value-added tax (VAT) situation have all caused consumer prices to be more affordable abroad than in China. Consequently, Chinese people with the financial means to do so will opt to do their spending abroad. If China doesn’t resolve this issue in a timely manner, the (revenue-less) outbound Chinese tourism is likely to continue to grow, and the slowing growth of inbound tourism will not be able to make up for it. Dai Bin also believes that China currently places too much emphasis on regional tourist attractions (tourist traps) and group tours, which has overly-concentrated where money is spent and dissuaded additional consumption. Money issues aside, these types of travel options leave tourists feeling overwhelmed by the sheer number of people, which in turn influences their tourist/consumer experience.
 

Source: gcpnews

 
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Keywords: China tourism industry China domestic tourism China tourism data China international tourism