European countries, led by France and the U.K. are seeking to pull in well-heeled Chinese tourists like never before, easing visa regulations and opening up new travel centers to make it easier for them to visit.
Under a pilot scheme announced by the U.K. and Belgian governments, U.K. visa centers in Beijing, Guangzhou and Shanghai will also handle Belgian visas, which allow Chinese visitors to travel throughout the 26-country Schengen area. During Premier Li Keqiang’s recent visit to Brussels to attend an EU-China summit, it was announced the European Union will open visa centers in 15 Chinese cities that do not have an embassy or consulate.
At Li’s stop in Paris, French Prime Minister Manuel Valls said his government would issue more long-term visas to Chinese visitors, and that it hopes to see the number of Chinese studying in France rise from 20,000 at present to 50,000 in the near future. Since January, French consulates in China have been issuing individual visas within 48 hours. Valls boasted France was “the only country to offer this.”
While the U.K. has launched a 24-hour “super priority” visa, this is only available to business travelers and costs an eye-watering 600 pounds on top of the basic visa fee.
France is the world’s top tourist destination, with almost 84 million visitors arriving last year. That included more than 2 million Chinese. France predicts the number will rise to 5 million in the near future. In May Chinese billionaire Li Jinyuan sent 6,400 of his employees on a four-day holiday to Nice and neighboring Monaco. The caravan comprised around 150 tour buses.
Paris for sale
While Russians love Milan and Thais prefer London, for Chinese tourists, Paris is the top shopping destination, according to duty-free shopping specialist Global Blue. Chinese visitors to Paris spend more than 80% of their budget on shopping, according to HSBC, a bank. That spending has been boosted by a weak euro.
All that shopping is not just for fun. It is much cheaper to buy some luxury goods in Europe and bring them back on the plane than to purchase them locally. And the price difference has grown as the single currency has fallen. Some Chinese sell their purchases at home at a profit. This gray market has forced luxury goods companies such as Chanel and Burberry to cut prices in Asia and raise them in Europe.
In Paris, cash-rich Chinese are an inviting target for thieves. The Chinese Embassy warns tourists to avoid certain train lines. On the upside, the French government is loosening restrictions on Sunday shopping.
Many Chinese choose to travel in tour groups. These are a relatively cheap way to see the sights. They also offer the reassurance of a Chinese-speaking guide and the camaraderie of one’s fellow travelers. But as they become wealthier and more experienced, more Chinese are choosing to travel on their own. This is boosting the fortunes of Chinese companies such as travel portal Qunar, which recently raised $500 million from U.S. private equity firm Silver Lake.
London held on to its crown as the world’s most visited city in 2014, narrowly beating out Bangkok. While the city attracts fewer Chinese tourists than Paris, those who come stay longer and spend more. Chinese visitors spend 60% their nights in the U.K. in London, according to consultancy Oxford Economics.
The city is a base for day trips, with one favorite destination being Bicester Village, an outlet mall in rural Oxfordshire that sells cut-price luxury goods. A 2013 analysis of Chinese microblogging site Weibo by consultancy Spectrum Insight found that Bicester Village was a more popular topic of discussion than London’s shopping streets or department stores.
The U.K. China Visa Alliance, which campaigns for easier visa requirements, estimates the U.K. loses up to 1.2 billion pounds a year in Chinese tourist spending due to tougher entry requirements compared with other European countries.
Stuck at the airport
Another handicap for Britain’s tourism industry is snarled airports in southeast England. No full-length runways have been built in the area since the 1940s. Heathrow is running at 98% of capacity and has just two runways, compared with four at Charles De Gaulle near Paris and six at Amsterdam’s Schiphol. From Heathrow, there are frequent flights to Hong Kong, but the only mainland Chinese cities served are Beijing and Shanghai. From Frankfurt, by contrast, travelers can reach six Chinese cities.
In the early 2000s most Chinese air travel was for business. By 2023 more than 60% of the country’s overseas air travel will be for leisure, says Oxford Economics.
Businesses are adapting to accommodate the influx of Chinese travelers. London’s high-end Harrods department store has 75 terminals that take UnionPay, China’s only domestically issued credit card.
Asia’s luxury hotels are also looking for a piece of the action in Europe. Hong Kong-based Shangri-La Hotels and Resorts has opened locations in a house once owned by the Bonaparte family in Paris and in London’s tallest building, the Shard. Another Asian luxury hotel operator plans to begin construction on a new Peninsula hotel in London in 2017, following the opening of its first property in Paris last year.
European countries are pulling out the stops to court the Chinese government as well. Following the 2010 general election, British Prime Minister David Cameron’s government pledged to build links with fast-growing Asian economies. It shut down consulates in provincial European cities and increased staffing in China and India.
While relations between Beijing and London suffered following Cameron’s meeting with the Dalai Lama in 2012, they have since improved. President Xi Jinping’s trip in October will the first state visit by a Chinese head of state since Hu Jintao’s in 2005, when many of London’s landmarks were lit up in red.