Wu: 100M Chinese tourists by 2015
A senior executive from The China Business Network says up to 100 million Chinese will be travelling abroad by 2015, Guardian Business has learned, and significant cooperation will be needed to secure the Caribbean’s slice of the pie.
Dr Adam Wu, the chief operating officer of the China Business Network, served as the final speaker at last week’s Caribbean Hotel Investment Conference and Operations Summit at Atlantis.
With less than 10 million Chinese travelling abroad in 1999, 57 million in 2010 and 65 million expected in 2011, Wu emphasized the importance of solidifying this surging tourism market.
“More and more Chinese have disposable income that are enabling them to travel abroad in order to explore opportunities overseas,” he told Guardian Business.
“The lack of a direct flight has been a barrier to many Chinese coming. But when they want to come they will come. It will not happen immediately.”
Wu identified many difficulties to securing efficient, direct flight service to The Bahamas.
One of the main stumbling blocks, he pointed out, is the fact that large planes would be needed for a relatively small destination.
He felt “cooperation would be needed” to achieve direct service to the Caribbean and “another load” factor would likely need to come into play to make the flight cost effective. In other words, direct flights would likely need to stop at another destination in The Bahamas or the Caribbean at large along the way.
Wu added that the easing of visa rules for Chinese travelling to The Bahamas is a significant step in the right direction.
“For now, the problem can be reduced in the short term by easing the terms of securing a visa and opening the gateway in the U.S.,” he said.
In fact, according to leading government officials, plans are underway to not only simplify the visa procedure for those travelling through the U.S., Canada or the UK, but possibly eliminate the need for a visa entirely.
In September, Brent Symonette, the Deputy Prime Minister, called the current visa procedure for Chinese tourists “a major problem”, and highlighted that simplying the process will be a major step in relations between the increasingly robust business partners.
Wu told Guardian Business that improving the means of travel between The Bahamas and China will also lead to higher levels of investment.
Explaining that the China Business Network is “always looking for suitable projects”, he said the Baha Mar project on Cable Beach “fits the profile” of the new reality of Chinese investment in the West.
The $2.6 billion project in The Bahamas is being financed by The Export-Import Bank of China. The majority of the construction is by The China State Construction Engineering Corporation.
Although perhaps the most high-profile in the Caribbean, it is just one of many Chinese-affiliated projects in the region.
During his speech, Wu referred the new $462 resorts known as the Punta Perla project in the Dominican Republic, which is also being built and financed through Chinese stakeholders.
During the Third Forum for Economic Cooperation and China-Caribbean Trade in Trinidad and Tobago last September, the Chinese government extended up to $1 billion in preferential loans to the region.
He encouraged as much collaboration as possible in the near future, saying steps that are taken now will have ramifications in the future.
“Most people don’t know there are 40 million Chinese living overseas right now,” he said.
“They are very keen investors in hotels and new Chinese money often follow the steps of what overseas Chinese did.”
The rising middle class in China, tens of millions every year, now want three things, Wu said: a house, a car, and a holiday.
Chinese travellers, according to the China Business Network, spent $48 billion in 2010 – more than five times the GDP of The Bahamas.
Wu said “investment is closely linked with outbound travel” and to what extent both are achieved will depend on how well stakeholders can work together.