Is China coming to a city near you?
Hong Kong is being transformed by the influx of mainland tourists, some say Chinese tourism magnets such as Paris, Seoul, and Taipei should prepare to deal with something similar.
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More than 6 million Chinese visited Taiwan in 2011, less than four years after a virtual ban on visits was lifted over security concerns. Last year Taiwan also began allowing solo tourists as a way to stimulate shopping.
About 7.7 million Chinese visited nearby South Korea last year, spending more than $2 billion, according to market research firm Euromonitor International. France saw about 1 million Chinese in 2011 and $503 million in receipts.
“Beijing’s grand strategy is to dominate East Asia without war but with economic and cultural tools,” says Lin Chong-pin, strategic studies professor at Tamkang University in Taiwan. In France, he adds, Chinese tourists “come and clean up the shops.”
Mainland shoppers in Hong Kong mete out an average $1,548 per trip, with 59 percent of that going toward shopping, consumer research firm The Nielsen Co. estimates. And that could easily rise if China meets its recently announced goal of doubling annual incomes by 2020 from an average of $4,940.
Still, at this point no other place compares to Hong Kong on the number of arrivals, proximity to China (it shares a land border), ethnic links, and questions about its political relations with Beijing.
“We are indeed taking on the role of learning and recognizing their culture and language,” says Dickson Chan, sales director with the Hong Kong tour operator United Holidays. He suggests that other world cities “learn from visitors and provide the best of services to attract them.”
Social, economic tradeoffs?
Along Canton Road, an upmarket shopping district, almost every shopper stopped by a reporter comes from mainland China. Families line up at Gucci and Hermes outlets to take advantage of Hong Kong’s product authenticity guarantees and no sales tax, two perks hard to find in the mainland.
“My feeling is that Hong Kong is a big city, with a big city experience, and at the same time prices are cheaper,” says Canton Road shopper Deng Yanfei, of Guangdong Province. “Most of us come for the luxury brands like Louis Vuitton.”
Mainland shoppers generally go just for international brands, allowing big-name jewelers and clothiers to displace sole proprietors preferred by local shoppers.
“Now normal citizens can’t buy from areas near their homes,” says Mr. Ting from the chamber of commerce. “All the landlords would like to rent to shops for the big brands.”
One independent jeweler just off Canton Road reported no business from mainland Chinese despite heavy pass-by traffic. A tailor in the same mall said only foreigners buy suits from his nonbranded shop.
“If you are talking about Taipei or Singapore, they also need to adapt to [mainland Chinese] habits and their culture,” he says. “The customer is king.”