Chinese visitors a boon to Taiwan's tourism industry

Travel
Chinese visitors a boon to Taiwan's tourism industry
TAIPEI (Kyodo) -- China on Tuesday will implement the latest changes to its policy governing cross-strait tourism, doubling the length of time a Chinese visitor can remain in Taiwan, and allowing for the first time "free independent travelers" to visit the island outside of a registered group tour.

The expected economic benefits of these changes are significant in Taiwan, where the government hopes that jobs in tourism will help to replace those lost in manufacturing as companies have relocated to mainland China in recent years to take advantage of lower labor costs.

China's new policies will add to earlier ones that have dramatically altered Taiwan's tourism industry, making the mainland the No. 1 source of visitors, a position that until last year was held by Japan.

According to the Mainland Affairs Council, over 2 million mainland tourists have visited Taiwan since June 2008, when the Chinese government began allowing limited cross-strait travel, creating a profit of US$3.8 billion.

Under the new FIT program, 500 residents of Beijing, Shanghai and Xiamen will be permitted to visit Taiwan each day.

As these visitors can also stay longer, tourism authorities estimated that the changes will create business opportunities of US$9 billion to US$19.5 billion per year.

The greatest impact of Chinese visitors to Taiwan has been felt by those directly involved with transportation and hospitality.

Thanks to the increase in cross-trait flights, Taiwan's principal air carriers -- China Airlines and Eva Air -- anticipate higher earnings this year.

Eva Air recently announced it will spend NT$101.1 billion (US$3.4 billion) to purchase at least 25 new airplanes. Bus and taxi companies also expect to profit from changes, as they invest in promotions and equipment to deal with the expected increase in Chinese tourist traffic.

In Sun Moon Lake, one of Taiwan's top tourist areas, hotels welcome the new program. Lai Cheng-i, president of Shining Group, which owns the upscale Lalu Hotel, hopes to see a 5 percent increase in Chinese clientele, making them nearly equal to Japanese visitors.

Five-star hotels are not the only ones expected to benefit from the FIT program. Chuang Jin-chuan, owner and operator of an eight-room bed and breakfast at the other side of the lake from the Lalu said that while he serves mainly Taiwanese, he anticipates significantly more Chinese visitors thanks to the FIT program.

In addition to accommodations, shops that sell snacks and souvenirs have posted signs in simplified Chinese characters to attract mainland customers. Restaurants and food vendors have been especially pleased with the increased business.

Seventy-eight-year-old Tsou Chin-pen used to sell 200 to 300 tea eggs per day at the pier by the lakeshore. But in the last three years, this number has grown to 2,000 per day and continues to rise.

The real estate industry is also optimistic about the effects of the FIT program.

The recent implementation of a luxury tax to curb property speculation in Taiwan has increased the incentive for long-term investors, including those from abroad.

Huang Chiu-yuan, a project manager of Sinyi Realty Co., said that Chinese FITs are unlikely to invest in upscale apartments, but they may be potential buyers of office space, which they will then lease out in high-rent areas such as Taipei's Xinyi District.

Chinese investors will also be interested in the storefronts in popular tourist areas such as the city's famous Shihlin night market or along Zhongxiao East Road in eastern Taipei.

In all cases, real estate brokers are set to profit from the increase in Chinese visitors.

Not everyone is happy, however. While the tourism and real estate industries welcome Chinese FITs, some have expressed concern over problems caused by rising property values and threats to national security.

Others see only opportunity, pointing out that rising property values will be accompanied by more jobs and higher salaries. Even security concerns are likely to translate into increased employment as police and other personnel will be needed to deal with the heightened risk.

(Mainichi Japan) June 29, 2011


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