In recent years China has overtaken both USA and Germany to become the largest outbound market in the world with Chinese travellers now the top source of tourism cash, according to the UNWTO. In 2012 their annual spend was estimated at $102 billion, growing to a market of 97 million and spend of $124 billion in 2013 and 110 million and $165 billion last year. Routesonline sat down with Dr Adam Wu, Chief Operating Officer, China Business Network at the recent World Routes network development forum in Durban, South Africa to learn more...
Q) With China’s outbound market rising every year, how does China manage this constant increase?
A) "There have been a number of factors fuelling the outbound travel from China that are still present. More and more contacts and relationships have been developed between China and foreign countries, as like most others China is an open country. China has also become a main source of outwards investment – the outbound direct investment (ODI) reached over $100 billion in 2013, Chinese investors and firms have invested in nearly 25,000 companies in 196 countries and regions. Outward investment goes hand in hand with outbound travel particularly in the lucrative MICE sector. Over 169 countries/destinations have effected or signed ADS (i.e. Approved Destination Status) and 39 have signed visa waiver agreements with China. As well as this, more and more disposable income has enabled more and more of the Chinese population to travel abroad in order to fulfil their dreams of visiting foreign countries, to enrich themselves culturally with the experience of foreign destinations and people. China has the highest number of US$ Billionaires in Asia and 2 million US$ millionaires."
Q) Do airports in China need to change in order to cope with the growing amount of passengers? And if so, how?
A) "Yes, China needs more international airports who can cater for more direct flights to and from regional airports, in order to meet the growing number of outbound travellers from China. Since China is equally the same size of Europe, but Europe consists of over 30 or so countries, each with at least one capital city and often a number of international gateway cities such as Frankfurt, Berlin, Munich and Hanover etc within Germany alone, then each of the 30 provinces of China should have a gateway airport in the Provincial capital. If this was to happen, it will surely facilitate many more passengers and increase airports capacity dramatically whilst cutting down congestions in Beijing and Shanghai."
Q) How do airports across China need to adapt for infrastructure purposes?
A) "Most airports need more access to public transport, as most of them currently can only be accessed by car, which creates congestion and also pollution as well as being costly to passengers. In order for more regional airports to become international gateways, China needs to open the sky further and allow more regional and international as well as national airlines to fly to and from regional gateways."
Q) With the outbound market expecting a 15 per cent rise, where do you see the market heading in the long-term?
A) "Given the fact that only still a very small percentage of the huge population of China i.e. 1.34 billion are currently travelling overseas, the outbound travel from China surely still has much growth to go. More of the Chinese population will want to visit many more destinations thus, the future of the outbound travel market in China is very bright."
Q) Do you believe the Chinese outbound market has competition? And if so, who?
A) "Certainly, more destinations are trying to compete against each other to attract Chinese visitors as spend money in travelling to overseas destinations, airlines will try to compete. Destinations may also want to attract more visitors from other developing countries such as the BRICS. China has huge tourism resources within itself thus, if less destinations wish to attract more Chinese visitors China will benefit more by retaining its own visitors travelling and spending more money in domestic tourism. Outbound travel most benefiting the receiving countries who are competing against each other trying to attract visitors from other countries
Q) What are the key destinations for China, and how do you see this changing?
A) "Top 10 Outbound Destinations for Chinese visitors in the First Half of 2015 were: South Korea, Taiwan, Japan, Hong Kong, Thailand, France, Italy, Switzerland, Macau, Germany. With USA and Canada issuing multiple visas and with more and more destinations even wave visa requirement for Chinese nationals, those destinations will surely experience faster growing of Chinese visitors.
Q) Do travellers want to fly domestically, or is the tourist board pushing this?
A) "CNTA, the national tourism authority in China, surely is responsible for promoting China as an attractive destination for foreign visitors as well as to increase domestic tourism thus, it is in their interest to encourage more domestic travel. Outbound travel demand is also driven, although CNTA has been facilitating foreign destinations with ADS agreement so the promotion of any foreign destination in China is the responsibility of that destinations promotion authorities.
Q) What impact will this have on China’s route development with Europe?
A) "The more Chinese who visit nearby destinations means more will be travelling to further fields to places like Europe thus, Europe should still benefit more tourists as it has been proven that once Chinese visitors visit nearby destinations they will want to travel to further destinations, such as Europe and Americans etc."
Q) What next step do you deem to be important for the outbound market?
A) "The more destinations that liberalise their visa regime the more they will attract. More Chinese visitors provided with available direct flights is neededin order to sustain the fast growth of outbound travel from China."
Q) What does World Routes offer, which is vital to the China Business Network?
A) "CBN is happy to see more destination promotion authorities participating in World Routes because the aviation industry is interdependent with the tourism industry. Therefore, CBN is proud to support UVM in organising the World Tourism Summit alongside World Routes next year in Chengdu."