MARKET OVERVIEW|
Global Domination
MARKET OVERVIEW
China’s hospitality industry is reaping the rewards of the current tourism boom with analysts reporting positive market performance and record construction pipelines. But is this level of growth sustainable, asks Catherine Martin?
diligently building its empire, emerging as an economic powerhouse surging towards global domination. In 2010, it replaced Japan as the world’s second-largest economy and over the next decade, is expected to overtake the USA. But this isn’t the only title China is snatching
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from the grip of America. In April 2012, market analysts Lodging Econometrics announced that China’s construction pipeline had surpassed that of the USA. With 1,430 projects / 411,229 rooms in planning and construction stages as of Q1 2012, China exceeds the USA pipeline by 110,100 rooms. So what has driven this once guarded country
to the forefront of the global hospitality agenda? China’s tourism industry has in fact been gaining momentum for the past two decades. It is now ranked third in the United Nations World Tourism Organisation’s (UNWTO) classification of most popular travel destinations, attracting some 57.6 million visitors in 2011. 2012 is so far proving strong with arrivals swelling 7.3% year-on-year, the fastest growth rate since the fourth quarter of 2010 according to HVS.
24 Sleeper China 2012
hina’s rise to stardom has been phenomenal. While the rest of the world was reeling from the effects of a financial meltdown, the People’s Republic was
While these figures are impressive by anyone’s
standards, it is China’s growing middle classes and a desire to travel within their own country that offers the real opportunity. Fostered by a good education system, entrepreneurial aspirations and increased business opportunities, China’s discretionary income has seen a dramatic increase, giving rise to the so-called middle class. Add to that a sound infrastructure with robust road systems, high-speed rail network, and yet more airports under construction, tourism for the masses is booming. According to Helen Wang, author of The Chinese
Dream: The Rise of the World’s Largest Middle Class and What It Means to You, the Chinese middle class is already larger than the entire population of the United States. In fifteen years, it is expected to rise to 800 million. Wang believes that this statistic will continue to change the dynamics of the world and have a huge impact on the way we live. In tourism terms, this growth equates to a massive 2.9 billion domestic trips annually. That’s a lot of room nights. While China has long been on the radar of
international hotel groups, it is only in the last two years that development has really taken off. Strategies have been put in place for aggressive growth, the specific needs of the Chinese traveller
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