Tourist Market to Open to Foreign Investors by 2003

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Last updated at: (Beijing Time) Wednesday, November 21, 2001

Tourist Market to Open to Foreign Investors by 2003

Foreign investors will be permitted to hold shares in tourist agencies operating in China by the end of 2003 and to set up solely-owned agencies by 2005.

Solely-owned by 2005

In line with China's agreement with the World Trade Organization, foreign investors will be permitted to hold shares in tourist agencies operating in China by the end of 2003 and to set up solely-owned agencies by 2005.

Sun Gang, vice director of the State Tourism Administration, said Monday that the most obvious challenge facing domestic tourist agencies since China's WTO accession is brain-drain.

Tourist joint ventures which hope to expand their businesses nationwide will be eager to hire experienced and well--qualified local people, said the official.

He recalled that at the start of the 1980s, many talented hotel staff left state-owned businesses to seek higher salaries and better welfare packets in foreign joint ventures.

The trend has shifted only in recent years, when China's hotel business began maturing. A similar thing may happen in the tourist sector, said Sun.

To date, China has eight joint-venture tourist agencies.

Safe Haven for World's Tourists

As the number of tourists slumps across Asia and even the world, Chinese travelers began to exhibit unprecedented enthusiasm for tourism during the week-long National Day holidays.

The number of tourists in 87 major scenic spots across the country reached 9.86 million during one short week, with ticket incomes surpassing 270 million yuan (US$32.53 million). Meanwhile, tourists witnessed a good tourism order, with no serious accident reported during the period.

"Chinese people have celebrated a safe golden tourism week," said Li Renzhi, director general of Industry Management Department of China National Tourism Administration (CNTA).

The Chinese government has paid great attention to tourism safety. In September, the CNTA began to cooperate with different ministries in maintaining the tourism order and inspect several areas including Hainan and Hunan provinces, and the Guangxi Zhuang Autonomous Region.

"We really enjoyed ourselves in Sanya city. Before we came, some friends were a bit worried about our safety. But when we said we were traveling to China, they were more assured," said Bob Lee, a Canadian tourist, in China's southern Hainan Province.

Li Renzhi said that China considers safety as the lifeline of tourism industry. To enhance the safety awareness will help build up tourists' confidence from home and abroad.

Francisco, a Spanish representative taking part in the World Tourism Day conference in Ningbo, east China's Zhejiang Province, said that safety can not only promote the development of tourism itself but also draw more investment to the industry.

"The tense international situation has not yet posed a threat to China's tourism industry," said Mike Sharrocks, representative of the World Tourism Organization.

In the first eight months, China received 21 million international tourist arrivals, up 11.4 percent compared with the same period of last year.

Expected Boost from Olympics Bid Success

"It's great that Beijing has won the right to host the 2008 Olympics Games. We can expect the city to become one of the hottest tourist destinations in the world," Zhang Wenjia said excitedly in a recent tele-interview.

The chief representative in China for Switzerland Tourism pointed out that Beijing, a city with a long history, would host more and more foreigners in the next few years, amid rapid urban construction.

Perhaps the Olympics will not bring benefits to urban construction of other regions than Beijing. But as for tourism, that is another story, as most foreigners traveling to Beijing would often ask themselves, "Where is my next destination in China? "

"The bid success will also be conducive to building tourism infrastructure in different places. I estimate that local tourism bureaus will come to Beijing to do promotions before and after the Games," said a senior official with the China National Tourism Administration.

Xu Shengli, a representative in China for the German National Tourist Office, said that Beijing's success will generate enormous power to stimulate the tourism industry just like nuclear fissions.

He said, the modernization of tourism demands constant exchanges among various nations. Beijing will host tens of thousands of international athletes and coaches, and embrace an unprecedented tourism wave in the next seven years."

Liu Dunren, director of the Canadian Tourism Committee in Beijing office said, "I am so gratified at Beijing's success. Montreal, where I used to live, has held the summer and winter Olympics. I believe Beijing will be more successful in seven years. "

It is reported that several Chinese business investigation groups and individual tourists have traveled to Canada to learn advanced management.

Yu Changjiang, director of Beijing Municipal Tourism Administration, said, "We have changed the projected tourism growth target of four percent to eight percent after Beijing won the right to host the 2008 Olympic Games."

The number of star hotels will be doubled by 2008 and the reconstruction project of public toilets, with 200 million yuan investment, will be completed in due time.

Authoritative statistics show that the number of foreign tourists traveling to China totals 10 million annually, bringing in 16 billion US dollars worth of business volume.

In the next seven years, China's annual tourism income will increase 18 percent year-on-year, according to an estimation from Goldman, Sachs and Corporation.

Ye Zhen, spokesman for the National Bureau of Statistics (NBS) said that the preparatory work for the Olympics will raise the gross domestic product (GDP) by 0.3 percent year-on-year.

As China initiated the policy of opening & reform, China's tourism industry witnessed tremendous achievements. In 1999, total tourist arrivals to China and the revenue generated from inbound business ranked 5th and 7th respectively among the world top destinations. At the turn of new century, China has worked out its strategic plan for tourism development for the next 20 years and the goal is to become the world's leading tourism country.

China's Tourism Development in Recent Years

Indices Year	1995	1996	1997	1998	1999
Total number of tourists from abroad(1,000 person-times)	46,386.5(6.2)	51,127.5(10.2)	57,587.9(12.6)	63,478.4(10.2)	72,790.0(14.7)
Including: foreigners	5,886.7(13.6)	6,744.3(14.6)	7,428.0(10.1)	7,107.7(-4.3)	8,430.0(18.6)
Overseas Chinese	115.8(0.5)	154.6(33.5)	99.0(-36.0)	120.7(21.9)	-
Hong Kong and Macao compatriots	38,851.7(5.0)	42,494.7(9.4)	47,943.3(12.8)	54,075.4(12.8)	-
Taiwan compatriots	1,532.3(10.2)	1,733.9(13.2)	2,117.6(22.1)	2,174.6(2.7)	-
Number of domestic tourists(billion person-times)	0.629(20.0)	0.639(1.6)	0.644(0.8)	0.694(7.8)	0.710(2.3)
International tourism earnings(billion US dollars)	8.733(20.9)	10.200(16.8)	12.074(18.4)	12.602(4.4)	14.100(11.9)
Domestic tourism earnings(billion yuan of RMB)	137.570(34.4)	163.838(19.1)	211.270(29.0)	239.118(13.2)	283.100(18.4)

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