Date
25 September 2017
US luxury retailers may be getting fewer visits from Chinese officials on training trips, but rich mainland tourists are more than making up for the shortfall. Photo: Bloomberg
US luxury retailers may be getting fewer visits from Chinese officials on training trips, but rich mainland tourists are more than making up for the shortfall. Photo: Bloomberg

China anti-graft drive hits US tour operators

China’s crackdown on government corruption has had an impact overseas as well.

It is also hurting the business of tour operators in the United States that cater to government tour groups from China, Reuters reported Monday.

Almost every year for more than a decade, tour operator Carson Zhang guided a delegation of about two dozen Chinese government officials from Guangdong’s provincial Forestry Administration on a two-week trip through the national parks of California, Tennessee, and Georgia.

Along with presentations about forest fires and trail preservation, the officials enjoyed lobster and steak dinners, went to see Tennessee bluegrass musicians perform, and made a stop at one of Orange County, California’s shopping malls.

Zhang’s company, American Carson International, catered almost exclusively to government tour groups from Guangdong province. But in the past couple of years, official tourism from there has been scaled back, and the forestry group has not visited the US since 2012, he said.

There’s widespread fear in China that an overseas trip will attract the wrong kind of attention from the government teams investigating corruption. 

State news agency Xinhua reported in January that the number of officials who traveled overseas for training approved by the State Administration of Foreign Experts Affairs fell 32 percent in 2013. The body approves trips below ministerial level.

International “training” trips, meant to help Chinese officials learn about business and government practices in other countries, are less frequent and shorter. 

Before the crackdown, the groups often had a light official schedule, leaving plenty of room for sightseeing and trips to shopping malls, restaurants, and casinos. 

“In the past, most of these trips have been one day of official business and 10 days of travel,” said Sage Brennan, co-founder of the Los Angeles-based consulting group Luxury China Advisors, which advises clients such as luxury retailer Bergdorf Goodman and the Los Angeles Tourism and Convention Board on how to attract Chinese consumers. “Those kinds of trips have disappeared.”

Brennan estimates officially sanctioned Chinese government travel to the US fell as much as 90 percent in the first half of 2013 and hasn’t recovered much since.

In recent years, however, the number of private tour groups and individual tourists has risen as mainland Chinese have become wealthier, more than offsetting the decline in official visits.

Chinese tourists visiting the US in July jumped 22 percent over the same month last year,  the latest figures from the US Department of Commerce show.

Members of China’s well-heeled jet set take on average three international trips a year, the Nielsen Mainland Chinese Luxury Shopper survey found. Chinese consumers of luxury products also spend three times as much abroad as they do at home, a Bain & Co. 2014 global luxury report showed.

However, data on how many of these free spenders were officials or their family members might be hard to come by.

– Contact us at english@hkej.com

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