Saturday, October 04, 2014

Alarming: Taiwan records highest foreign tourist arrivals growth worldwide

10/04/2014 Taiwan Explorer
"Taiwan records highest foreign tourist arrivals growth worldwide" - An article with this title is circling around Taiwan's online media and social networks today, and portrayed as something Taiwan should be proud of. Whenever Taiwan tops an international list, the media immediately starts a virtual pride parade. Initially published by Focus Taiwan (the English version of the CNA a.k.a. Central News Agency), the article came without any source link, which is always a little suspicious to me. I decided to dig around, and see what is behind this story. First of all, the story originated from UNWTO (United Nations World Tourist Organisation), a press release titled "International tourism up by 5% in the first half of the year" can be found here. Most of the data from that press release is taken from the "UNWTO World Tourism Barometer" [PDF], which is a summary of a more detailed data that highlights tourism trends by country. That statistic is behind a paywall, and includes detailed data on Taiwan, and other countries for first half of 2014. For some reason Focus Taiwan has access to that information, however I was unable to obtain this file, so in fact I can't verify Focus Taiwan's numbers, but I do trust that they are true.

Why these numbers are bad for Taiwan

While I'd love to have the original file at hand and offer a deeper analysis, it's not necessary to figure out that something is not right here. Let's see this paragraph:

"In a report, the UNWTO said that foreign tourist arrivals in Taiwan for the first six months of the year rose 26.7 percent from a year earlier, topping Japan's 26.4 year-on-year percent increase, which was the second largest in the world."

So YoY (year over year) growth of foreign tourist arrivals in Taiwan was the largest in the world. Some may think: "Yay! Taiwan is so great, no other country in the world is welcoming foreign tourists at a faster pace than Taiwan in the first half of the year." However, this is only one half of the story. The next paragraph exposes the main problem:

"The UNWTO report also showed that Taiwan's international tourism revenue for the first half of the year rose 18.5 percent from a year earlier, behind only Japan with a 27.5 percent increase and South Korea with a 25.2 percent rise, in the world's rankings."

So while the number of arrivals to Taiwan grew 26.7%, the tourism revenue only grew 18.5%. This means the actual spending of these tourists dropped on average (while the opposite has happened in Japan and South Korea), and that is definitely nothing to be proud of, because we're basically getting more and more people into the country, but they keep spending less and less. And it seems that the growth will not stop any time soon, as the article further indicates:

Liu [head of Taiwan's Tourism Bureau] said the bureau will continue to promote Taiwan's beautiful scenery and rich culture to potential foreign visitors this year, and is confident of attracting 9.5 million foreign tourists for the whole year, up from some 8 million in 2013.

And what does Taiwan's government think about the record growth of mass tourism, the declining spending, and all the negative impacts that go with it? We get the answer to that at the end of the article:

Meanwhile, Vice President Wu Den-yih said he expects Taiwan's foreign tourist arrivals to top 10 million in 2015, in light of the current tourism data and the government's promotion campaigns.

Great! The government's answer is more tourists.

While we don't have UNWTO's H1 2014 stats publicly available, you can check their numbers for 2013. And yes, Taiwan is listed as Province of China.

Who are these tourists?

If you live in Taiwan like me, you don't need to be a scientist to realize that the biggest part of these record numbers consist of tourists from China, it's obvious almost everywhere you go. The latest government numbers for January to July 2014 confirm that:

A total of 5,630,085 visitors arrived in the Republic of China from July through July this year, up 1,189,347 or 26.78% from the 4,440,738 in the same period last year.

These are some staggering numbers. Let's see what were the top 5 countries of arrival:

1. Mainland China accounted for 2,305,638 or 40.95% of the total, up 38.41%, consisting of 22,140 foreign visitors, up 6.63%, and 2,283,498 Overseas Chinese, up 38.81%.

2. Japan accounted for 900,682 or 16% of the total, up 18.39%, consisting of 900,043 foreign visitors, up 18.43%, and 639 Overseas Chinese, down 19.72%.

3. Hong Kong and Macao, 792,318 or 14.07%, up 18.93%, consisting of 69,225 foreign visitors up 2.17%, and 723,093 Overseas Chinese, up 20.83%.

4. U.S.A., 264,801 or 4.7%, up 12.28%, consisting of 262,708 foreign visitors, up 12.49%, and 2,093 Overseas Chinese, down 9.16%.

5. Southeast Asia, 764,962 or 13.59%, up 17.14%, consisting of 760,146 foreign visitors, up 17.32%, and 4,816 Overseas Chinese, down 5.92%.

As you can see, visitors from the neighboring PRC a.k.a China (including Macau and Hong Kong SAR) contributed over 55% of foreign arrivals. You can imagine that such dependency on mass tourism from one country is not healthy in the long run, what's more, China is the biggest threat to Taiwan's peace and security, which adds a whole different dimension to the issue. To be fair, arrivals from almost every country are growing, but those from China are overshadowing every one of them.

Taiwan's government has a strange obsession with dividing people into "Overseas Chinese" and "Foreigners" (source, 2013). No idea what is this good for.

Mainlandization has already begun in Taiwan

Mark O'Neill's article "Mainlandization: How Hong Kong and Taiwan are coping" from August (which I highly recommend) seems to be a very good read in the wake of the recent Occupy Central movement. He sums up the biggest issue very well:

The situation is similar in the two places. In the first half of this year, 21.82 million mainlanders visited Hong Kong, an increase of 16 percent year on year, accounting for 77 per cent of all tourists.

In the first five months of the year, 1.65 million mainlanders visited Taiwan, up 38 percent and accounting for 41 percent of all visitors. Taiwan imposes a ceiling of 5,000 a day on mainlanders who come in groups.

Because Hong Kong is smaller and the number so much higher, the impact is greater. The debate in both places is fierce, the arguments are the same.

Hong Kong is unfortunately the best indicator of what kind of future awaits Taiwan, if it allows more Chinese tourists into the country. Tourism and politics are not that far from each other when it comes to Taiwan and China, things we have never imagined are already happening in Taiwan, and I think it's about to get worse. I'm all for Chinese tourists coming to Taiwan, I welcome the exchange, especially with those who don't come in groups and have a general interest to discover the country's treasures, but there has to be a balance. Chasing high arrival numbers for the sake of hitting milestones is very backward. Taiwan should focus on increased spending per person, not increased influx numbers, why can't the government put efforts in developing the premium segment, instead of focusing on the masses?

This is Chinese mass tourism on Alishan, one of Taiwan's most scenic mountains.

Related: Difference between Chinese and Taiwanese tourists.