China Tourism 'Fetter' to be Freed on Foreign Capital

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Last updated at: (Beijing Time) Monday, July 22, 2002

China Tourism 'Fetter' to be Freed on Foreign Capital

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Nowdays people can hear louder voices for opening up China's tourist market to foreign capital. Persons of the tourism circle here had an urgent appeal for quick free of the "fetter" on foreign capital in China's tourist market.

According to China's WTO entry commitments the foreign capital should be permitted to take the holdings in a joint-venture travel service in China by the end of 2003 and tourist agencies solely owned by foreign capital will be allowed to set up prior to the end of 2005. The foreign-invested travel agencies may have the right to engage in the inbound tours and tours in China but they are not permitted to do tours for Chinese citizens to go abroad for travel.

From this year onwards, the newly revised and implemented "Regulation on Management and Control of Travel Agencies" in China brought out a "special regulation on foreign invested travel agencies", which stipulate explicitly the conditions for establishing a foreign-invested travel agency, amount of registered capital and the particular ratio of capital put in by foreign and Chinese sides. Besides, the "regulation" has also stressed that no foreign-invested travel agency is allowed to run any branch office in China.

China, as a country with the richest tourist resources in the world, must continue to make tourism industry a new spotlight for growth in national economy, pointed out Zhang Jianzhong, Director of the Department of Policies and Regulations of the National Tourism Administration of China (CNTA). And the threshold must be further lowered for civilian-owned and foreign-owned travel agencies to engage in travel services in China.

The business scope for the Chinese partner in a joint venture may further be expanded. It's not necessary to carry the business out in a way in which the quota for outbound tours is decided by what has been achieved in inbound tours, said Dai Bin, a person in charge of research and development of policies with China Travel Service. It is by no means of no good to see more foreign capital invested in industry of Chinese travel agencies. For tourist enterprises or groups from Hong Kong and Macao to run joint ventures in China's inland, they should be permitted to take holdings of the company or to set up independently their own travel agencies, encourage them to purchase or acquire the travel agencies of small and medium sizes in China's inland.

Up to now, China has approved 11 joint venture travel agencies and the investors are respectively from the following countries and regions of Switzerland, Japan, France, the USA, Singapore and China's Hong Kong SAR and China's Macao SAR, etc. The CNTA expresses that further efforts will be made to open China's tourist market wider to the outside world and the particular measures are as follows:

To further the shareholding patterns for foreign capital to get into the Chinese tourist service and to attract foreign travel agencies of good businesses, of good reputation and advanced management experience to enter China's tourist service market, and gradually cancel the regional restriction on the entry of foreign capital into the Chinese tourist services;

To actively harmonize and regulate the approval procedure and principle for the foreign-invested projects in China's tourist services, improve the law, rules and regulations in this connection and simplify the procedure and norm of approval to make it open, just and fair;

To improve the orientated mechanism for tourism investment, to offer more instructions and work in a harmonious way for foreign capital to invest in tourist service projects, especially in those of the middle and western regions of China so as to put them into the primary list for drawing in foreign investment;

In line with the trend and requirement for the development of international tourism, the reform in tourism system will be further deepened with the tourism administration and management system improved and tourist service quality enhanced, to cultivate new growth points of the industry and offer timely guidance to new investment and projects, thereby opening wider the tourism industry to the outside world.

To date, a joint venture enterprise for China-US business travelers has been set up, in which the cooperative partners are the China International Travel Service Head Office and the American Express. And as revealed by a person concerned, before long it will be possible for foreign businessmen to set up on trial basis travel agencies in China. Judging from the situation, it's going to be "true" for foreign capital to march into the Chinese tourism market

By People's Daily Online

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