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Chinese travellers' numbers set to explode

Publication Date : 21-01-2014

 

Patrick Bai and his wife, both 52, work hard all year round. He is a general manager at a British engineering company; she is a housewife who takes care of their home in Shanghai and frets over their son studying in Europe.

For relaxation, they take at least three holidays every year, including "a short jaunt to Hong Kong to shop", said Mrs Bai.

By the second day of their current visit, their "seventh or eighth" to Hong Kong, they have already snapped up an iPad and some work suits. They were looking at Rolex watches when they spoke to The Straits Times.

One country next on their list is Singapore.

"I will like to sight-see, perhaps check out the casinos, and just breathe in some nice, clean air," said Bai with a laugh.

Meet Mr and Mrs China. To be specific, Mr and Mrs China who are shopping and spending their way across the world.

There will be many more.

A new study here has projected that the number of Chinese tourists will double from an estimated 100 million last year, to 200 million by 2020. Their spending will triple, from 500 billion yuan (US$82.6 billion) last year, to 1.4 trillion yuan in the same period.

The story of the big-spending globe-trotting Chinese tourist is not new; since the economy took off in the 1980s, more and more can afford to travel.

But the numbers are set to explode at an exponential rate in the coming years, predicts brokerage CLSA which surveyed 1,000 Chinese travellers in 41 cities on their aspirations. Factors range from employers granting longer annual leave (now between zero and five days) and more countries relaxing visa rules for Chinese visitors (only 44 now allow visa-free entry), to worsening pollution and crowded tourist attractions at home.

The key driver is the income hitting what CLSA regional head of consumer and gaming research Aaron Fischer called the "tipping point" - a US$8,000 per-capita GDP - based on the experiences of other East Asian economies. Just 10 of China's 31 provinces, regions and municipalities are at this level. This will rise to 27 by 2020, he projected. "The Chinese travellers story is just at its beginning."

Among the biggest beneficiaries is Singapore as it ticks the right boxes for several attractions the Chinese tourist looks out for: gambling, luxury goods and "cheaper yet better health care". Its relative proximity and reputation for safety are attractions too.

The snag is its high hotel occupancy rate, which makes Singapore a "very expensive place to visit". Still, he projected the number of Chinese tourists to Singapore to grow from 2.1 million in 2012 to 7.1 million in 2020.

Other countries are also wooing the Chinese. According to The Chosun Ilbo, 42 out of 58 malls in downtown Seoul offer help with Mandarin, and almost all shops selling cosmetics have at least one Mandarin-speaking assistant.

The challenge is that they are also a fickle market, always seeking the novel. Louis Vuitton, for instance, is "now considered common", said Wolfgang Arlt of the China Outbound Tourism Research Institute in Germany. "What they want is something you cannot get in China."

They are also looking for new experiences. One recent fad is to visit locations where popular television shows or movies were made. And the ultra-wealthy are pushing the frontiers in where they can go to "gain bragging rights", said Fischer.

Two Chinese are in the race to be the world's first space tourist. Others aim for "exotic trips" to the North Pole on ice-breakers, said  Arlt. "For the Chinese traveller, what matters a lot is about gaining prestige, not just about having a holiday."


 

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