Chinese insatiable appetite for foreign travel
IT IS SAID to be the second-most-popular destination for Chinese visitors to Britain after Buckingham Palace, yet Liu Xiaoming, China’s ambassador to the country since 2009, jokes that he has refused invitations to take part in tree-planting ceremonies there.
The attraction is Bicester, a town in Oxfordshire of little note for tourists except for its shopping centre, called Bicester Village. It is a kilometre-long strip of more than 160 clapboard outlets selling luxury brands at a discount: Boss, Gucci, Salvatore Ferragamo, Versace and many more.
Mr Liu’s excuse for not visiting Bicester, as he informed a think-tank audience in 2011, is that “China is a developing country” and it would not be right for him as its ambassador to promote the shopping mecca. Still, last year the outlets received some 6.6m visitors, about the same as the British Museum, of whom about half were foreigners. Half of those were from China—including diplomats, in their unofficial capacity. Without China, Bicester would not be what it is today. As trains approach Bicester Village station, passengers are alerted in Mandarin.
A middle-aged Chinese bureaucrat on a week-long trip to Britain shows off several bags filled with shirts from Charles Tyrwhitt and a jacket from Burberry. He says he has spent more than £1,000 ($1,400). Another Chinese visitor, a retired professor of art, has splashed out over £200 on T-shirts from Boss. A woman from the central Chinese province of Hunan shows a couple of bottles of Estée Lauder skincare lotion that she picked up for £190—one for herself, another for a friend. They all say the goods they have bought are much cheaper than they would be in China, helped by a weak pound and rebates of value-added tax for foreign visitors.
According to Global Blue, a tax-free-shopping firm, Chinese visitors bought more than one-quarter of all the tax-free products sold in Britain last year. Their spending was up by nearly one-third on the year before. To make life easier for them, Bicester Village has recently introduced facilities to pay through WeChat, a Chinese social-media and payments platform. Chinese travellers abroad often grumble about other countries’ backwardness in electronic payments. Their own big cities are almost cashless.
Economically, there is no doubt that the surging numbers of Chinese travellers abroad are changing the world. Most conspicuously, they are becoming the main props of luxury brands. McKinsey, a consultancy, says Chinese people account for one-third of global spending on luxury goods. Between 2008 and 2016 they were responsible for three-quarters of the growth in such spending, the firm reckons. Much of this is done outside China, where prices are often lower than at home, but McKinsey says that even when prices are similar, nearly a third of Chinese shoppers still prefer to buy luxury items abroad. According to the UN’s World Tourism Organisation, in 2016 they spent a total of more than $260bn, more than double the amount forked out by Americans abroad and about one-fifth of all global spending by international tourists. Only a decade earlier Chinese tourist spending had accounted for a mere 3% of the world’s total.
The spending numbers for recent years should be treated with caution. Gavekal Dragonomics, a research company, says official figures may be misleading because they include people who are not strictly tourists. It reckons that spending by recreational travellers alone in 2015 may have been less than $175bn, about 30% lower than the official figure for spending by all kinds of travellers abroad.
But even if many of the Chinese visitors are not really tourists, they are certainly spending. And they are increasingly interested in buying not just goods but luxury experiences or costly adventures off the beaten track. The number of Chinese tourists visiting Antarctica, for example, is now second only to those from America. There were more than 5,100 of them in the tour season of 2016-17, up from just over 1,000 in 2011-12.
And this is just the beginning. Less than 10% of Chinese currently hold passports, compared with more than 40% of Americans in 2017. By the end of this decade the number of passport-holders in China is expected to double to 240m, predicts Ctrip, a Chinese travel company.
For all its ratcheting up of political controls at home, the Communist Party does not seem concerned about the effect of exposing so many of its people to freer societies abroad. Officials may calculate that Chinese rich enough to travel abroad are unlikely to be impressed by the achievements of democratic systems. Infrastructure in many Western countries is often shabbier than in China, homeless people abound in big cities and crime is a constant risk. “I went to New York and I thought, this isn’t as good as Shanghai,” says a Chinese businessman.
China’s one big worry about the surge of outbound travel is that it could damage its image. Holiday destinations hear plenty of complaints about the noisiness of Chinese tourists and their disregard of local customs. In Hong Kong, locals staged several protests against tourists from the Chinese mainland in 2014 and 2015. Partly in response, the number of mainland visitors to Hong Kong plummeted. Officials often hand out leaflets at airports telling travellers how to behave in other countries.
Another fast-growing group of Chinese visitors abroad, students, are more alert to the social and political environment they find themselves in—but that does not necessarily make them appreciate liberal democracy.
The Economist
